Growing economic uncertainty is going to take a toll on the advertising industry this year.
Ad sales for traditional media are expected to fall 7.2% this year
Growing economic uncertainty is going to take a toll on the advertising industry this year.
Overall ad revenues are still expected to rise, but at a slower pace than previously projected, according to the media intelligence firm MAGNA (IPG). In its spring 2025 forecast, the firm revised its ad revenue growth estimate to 4.3%, down from an earlier projection of 4.9%.
The downward adjustment follows a record year in 2024, when political advertisements and the Summer Olympics helped push ad sales to $380 billion — a 12.4% increase and one of the strongest performances in 25 years, second only to the post-pandemic rebound of 2021.
While MAGNA had already anticipated a slowdown, the firm cited recent “economic uncertainty” as a reason for its further downward revision.
“MAGNA anticipates that the lack of visibility and risk of a trade war may cause marketing and advertising budgets to face freezes or cuts in industries that are most vulnerable to global trade, supply chain disruptions, and consumer confidence issues,” the report stated.
Among the key factors behind the adjustment include the recent stock market sell-off, concerns over rising food prices — such as spikes in essentials such as eggs — and the potential for trade disputes and supply chain disruptions. Such challenges could put pressure on sectors that typically fuel ad spending, including quick-service restaurants, consumer-packaged goods, and autos.
“The current – hopefully temporary – dip in confidence has already dampened the dynamics of the ad market, prompting us to revise our growth forecast for 2025,” said MAGAN executive vice president of global market intelligence Vincent Létang in a statement.“While total ad spend is still expected to grow in the mid-single digits, digital media ad sales will continue to experience high-single-digit growth. In contrast, most traditional media channels may face stagnating ad revenues this year.”
Traditional media owners are expected to take the biggest hit, with revenues declining 7.2% year over year. Linear television, including cable and satellite, is projected to fall by 5.9%, though streaming is helping to offset some of those losses, growing 14.3%.
Digital advertising, including search and social media, also remains resilient, with spending in those categories expected to climb 9.1%.
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