Global advertising is up for another round of change. Will slower growth for digital ad spend be part of it? Image Credit: Shutterstock

An exciting era is beckoning the advertising sector, where campaigns will be greener, cleaner and, most importantly, accountable. Personalisation will prove pivotal, and ad agencies along with the brands they represent, will embrace a spate of innovations.

This is all down to several factors, including the recent economic and geopolitical insecurity, which led to redundancies and which considerably stirred the advertising sector. Going forward, the industry will prioritise technology, data, sustainability and purpose. This will necessitate an accountable RoI (return on investment) focused approach where organisations and brands can consistently review their spend, its effectiveness and reach, and, ultimately, the RoI.

In this era of global climate emergency, ad agencies will be supporting much more sustainable media. Inflationary pressures are reinvigorating ad-funded video-on-demand plans and boosting TV investments, while AI is already being utilised to maximise media effectiveness.

Digital media has witnessed strong double-digit growth over the past two decades. However, this year will mark the beginning of a three-year cycle of single-digit growth for it. This tempered gain suggests digital media spend is reaching maturity in the marketing mix - and advertising itself seems to be settling into a new rhythm.

Every $3 out of $5

Digital is projected to experience almost consistent incremental growth over the next three years, accounting for about $3 in every $5 spent in advertising, according to Dentsu’s ‘Global Ad Spend Forecasts’. Campaigns will continue to become much more ‘measurable’, with retail media, CTV, and social all vying for a greater proportion of the spend.

Addressable models offer targeted advertising based on user data and preferences that let marketers assess results and adapt content in rea- time. It means brands can deliver valuable experiences more efficiently. However, advertisers must work to preserve the value exchange with audiences because consumers feel the traditional value exchange in advertising - where people enjoy free content in exchange for their attention - has been damaged through trade-offs with their privacy.

The US, which will remain the world’s largest advertising market, is set to reach $300.6 billion in 2023. China is forecast to hit $123.4 billion, while India will see its third consecutive year of double-digit growth. For the MENA region, the figures are equally as encouraging. In 2020, digital ad spend amounted to around $4.4 billion and expected to increase to $7.9 billion by 2024.

Developments in Generative AI will herald a new era in advertising, particularly for search. Applications like ChatGPT have the potential to change how people interact with brands. While market dynamics will not change abruptly, the building blocks for reinventing the sector have been laid…