Dentsu Media has released its 2024 Global Ad Spend Report, forecasting expectations and industry trends for the coming new year and beyond.
Key technological changes and big cultural moments are expected to impact the industry in 2024. On the tech side, scalable generative-AI powered solutions for media are expected as well as the demise of third-party cookies in the second half of the year. Culturally, the global industry will experience the impact of major sports events such as the Paris Olympics and Paralympics along with important elections in the U.S, UK and India.
Ad spend growth in 2023 has been driven by media price inflation and inflation will continue to influence growth in 2024. Dentsu projects the Canadian ad market will be $9.3 billion in 2024 to reach $9.8 by 2025.
Modest growth is projected for the Canadian economy. The S&P Global forecast for Canada suggests sluggish 0.8% growth in 2024 and 1.4% in 2025. With this, subpar in-store demand is expected in 2024, along with a sluggish job market and rising unemployment to an average 6.1% in 2024, up from a 5.4% average this year. BMO expects the Canadian economy to trail the U.S. for the next 18 months.
As the Canadian economy slows in 2024 so will ad spend. The report says growth in advertising spend in Canada will be flat for most of the next three years — 3.5% growth in 2023, 3.6% in 2024, and 3.9% in 2025.
According to the report, in the new year ad pressure will reach new heights. Globally, advertisers are expected to spend $139 per capita, about 75% more than 20 years ago; in 2024, Canada will rank sixth in per capita ad spend at $275. While showing that advertisers always spend more to attract consumers, the per capita indicator also illustrates the growing ad load and the growing ad pressure faced by audiences. Because of this, Dentsu says the industry needs to move to attention and quality and focus on removing waste in Canadian media investment.
Digital ad growth is slowing and will continue in single digits for the next few years with 5.9% this year, 4.9% in 2024, and 5.1% in 2025. TV has reached a plateau in Canada despite the growth of connected TV. In 2024, total digital will account for 62.0% of the Canadian market. Total TV will take a 24.0% slice of the pie and other media, 14.0%.
Search ad spend increased by 7.2% in 2023 to account for over one-third of digital ad spend. Search will remain strong due to new AI-powered solutions, in addition to a shift to integrated search and new products that go beyond Bing and Google in Canada and will contribute to further growth into 2024.
Connected TV ad spend in Canada is not forecast to grow as fast as the rest of the world. The global CTV spend was up 16.1% year-over-year in 2023 and will continue to grow at a 21.5% three-year CAGR (compound annual growth rate). In Canada, CTV spend grew by 13.0% in 2023 and is projected to increase by another 11.0% next year and 9.7% in 2025.
Looking at other media in Canada, the Dentsu report says the print market will decline about 52% by 2026. Growth of out-of-home in Canada is slowing but will continue to be strong in the market. Audio is slowly building back from its pandemic loss due to digital audio hitting its peak in 2024.
Cinema ad spend predictions have been revised up for 2024 and 2025 but spending remains below 2019 levels. The global box office is on the rise year-over-year, exceeding 2022’s total by the end of September 2023, although it will still be 18% below the 2019 total at the end of the year. In Canada revenues are still down by 77% versus 2019 and attendance is not at 100% of what it was in 2019.