• Advertising's Digital Dominance and Retail Media Surge: Navigating 2024's Transformation

  • Dec 30 2024
  • Length: 3 mins
  • Podcast

Advertising's Digital Dominance and Retail Media Surge: Navigating 2024's Transformation

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  • Summary

  • The advertising industry has wrapped up 2024 with record-breaking results, driven by the dominance of digital channels and the rise of retail media. According to GroupM's "This Year Next Year 2024 Global End-of-Year Forecast," global advertising investments saw a 9.5% increase in 2024, crossing $1 trillion in revenue for the first time. This growth is expected to continue, with a projected 7.7% increase in 2025, reaching $1.1 trillion[1].

    Digital advertising remains the industry's powerhouse, with a 12.4% global growth in 2024. It is expected to account for 72.9% of total advertising revenue by 2025. Retail media is emerging as a standout segment within digital, with projected revenues of $177.1 billion in 2025, overtaking total TV revenue, including streaming, for the first time[1].

    The industry has also seen significant mergers and acquisitions activity, particularly in ad tech. In Q3 2024, ad tech M&A activity saw a 13% increase quarter over quarter, with notable increases in scaled transactions over $100 million. This trend reflects a broader shift towards consolidation and expansion into new markets[2].

    Out-of-Home Advertising (OOH) has sustained its global share, thanks largely to digital out-of-home (DOOH) advancements. DOOH is forecast to represent 42% of total OOH revenue by 2025[1].

    Despite these positive trends, the industry faces challenges, including shifts in consumer behavior and regulatory changes. The digital ecosystem is undergoing significant changes, including changes to cookie policies and ongoing antitrust trials, which are anticipated to further impact dealmaking in this space[2].

    In response to these challenges, industry leaders are focusing on optimizing the supply path (SPO) and demand path (DPO) to improve transparency and efficiency. Programmatic DOOH is experiencing rapid growth, with real-time bidding opportunities becoming more accessible through widely used DSPs[3].

    Key statistics from the past week include:
    - Global advertising investments saw a 9.5% increase in 2024, crossing $1 trillion in revenue for the first time[1].
    - Digital advertising grew by 12.4% globally in 2024 and is expected to account for 72.9% of total advertising revenue by 2025[1].
    - Ad tech M&A activity saw a 13% increase quarter over quarter in Q3 2024, with notable increases in scaled transactions over $100 million[2].
    - DOOH is forecast to represent 42% of total OOH revenue by 2025[1].

    Overall, the advertising industry is navigating through a period of transformation, with digital channels and retail media driving growth. Despite challenges, industry leaders are adapting by focusing on transparency, efficiency, and innovative technologies.
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