Despite ongoing economic concerns, the ad market is expected to improve later this year. In 2022, US advertising revenues grew by 6%, reaching $315 billion, according to the latest report from IPG Mediabrands’ Magna agency. Though Magna had initially projected an increase in ad revenues of 3.7% in 2023, the global intelligence company’s latest revision estimates growth of 3.4%. Nonetheless, the ad market is expected to reach an all-time high of $326 billion this year, with most growth happening in the second half.

Some of last year’s boosts were due to cyclical events, such as the elections or Olympics, which often generate roughly $7 billion in ad spending during even-numbered years. Still, despite those missing political and cultural moments in 2023, receding inflation rates combined with a resilient job market mean increased stability for the advertising industry. “In a similar economic climate 10 or 20 years ago, the US advertising market would almost certainly fall off a cliff,” said Vincent Letang, head of global market intelligence at Magna.

Media innovation is also fueling marketing demand with developments like the continued growth of over-the-top streaming platforms that are increasingly introducing ad-supported tiers, as evidenced most recently by Netflix and Disney Plus. Despite a slight decline in linear TV sales, the long-form video market (combining linear and streaming) will stabilize at around $44 billion. “With long-form OTT streaming going mainstream and [becoming] increasingly ad-supported, brands finally [are finding] cost-effective solutions to reconnect with audiences that had become hard and expensive to reach through linear television,” said Letang.

Digital advertising will continue its seemingly unstoppable rise, as digital media formats are expected to increase spending by 9% in 2023. With global markets continuing to heal after the pandemic and supply chain issues, the travel and entertainment sectors will also bump up their ad spend. And the automotive market is bouncing back too, with car sales expected to grow by roughly 10% this year.  

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