The Australian advertising market will grow 3.8% in 2025, according to forecasts by dentsu.
Dentsu’s latest Global Ad Spend Forecasts also revised upwards to 4% Australia’s 2024 growth.
This is a significant improvement from the forecast of 1.8% made mid year by the Japan-based advertising group.
However, dentsu in May did sees a brighter second half of 2024. Most analysts had expected a quiet start to the year, with a pick up in the second half.
“Expectations for the Australian ad market have been revised up to 4% for 2024 based on significant growth in search, social and video,” dentsu analysts write in their end of year forecasts.
“Continued growth is forecast in 2025 at 3.8% with a boost of government and political ad spend expected in the lead up to the federal election.
Dentsu expects ad spend in 2024 in Australia at $US13.4 billion, growing to $US13.9 billion in 2025, $US14.4 billion in 2026 and $US14.8 billion in 2027.
Globally, ad spend growth is forecast to continue at 5.9% in 2025, slower than the 6.8% of 2024 but outpacing the global economy by 2.7 percentage points.
The report highlights that digital is expected to remain the fastest-growing channel, with a projected increase of 9.2% to $513.0 billion in 2025 and capture 62.7% of global ad spend.
Significant growth is anticipated across key digital segments, with retail media leading the way at +21.9% as advertisers capitalise on the high value of retailer consumer data and increasingly invest in offsite advertising, including connected TV.
Paid social is forecast to grow by 8.7% in 2025 supported by an integrated ecosystem that blends shopping, video, search, and gaming capabilities.
This channel remains critical for engaging younger audiences, with 79.7% of Gen Z using Instagram monthly and 42% of CMOs planning to boost influencer marketing investments.
Paid search is expected to increase by 6.7% (6.5% three-year CAGR 2027), driven by continuous advancements in AI-powered features that sustain relevance amid the rise of social and retail search.
Online video advertising is projected to rise by 8.0% as advertisers continue to seek out high attention and trusted environments. Programmatic advertising is set to grow by 11.1% and will account for more than 70% of digital ad spend, with sustained momentum (10.9% three-year CAGR to 2027).
Television ad spend growth is forecast to show marginal growth of 0.6% in 2025, with connected television rapidly increasing (+18.4%) thanks to ad-supported streaming, and broadcast television declining (-2.5%).
Print media continues to contract, while cinema (3.2%) and out-of-home (3.9%) advertising grow.
Significant ad spend increases are anticipated in finance (+6.4%), pharmaceutical (+5.8%) and travel and transport (+5.5%) as these sectors adapt to meet evolving consumer needs.
Forecasts by industry (Based on markets Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Spain, UK, US):
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