Global advertising spend will increase by 8.3% in 2022, but market growth will slow to 2.6% by 2023, according to Warc.
Warc predicted that total global adspend in 2022 will be £746.6bn, however, the slowdown means it expects there will be £765.7bn spent on ads in 2023.
The figures mean that Warc has downgraded its previous expectations for global ad market growth by £76bn for this year and next.
The increase in 2022 has been bolstered by the U.S. midterm elections and will be further boosted by the men’s FIFA World Cup at the end of the year.
Economic uncertainty and the block on third-party cookies will cause market growth to slow in 2023.
James McDonald, director of data, intelligence and forecasting at Warc, and author of the research, said: “With the growth rate of global output now set to halve, and acute supply-side pressures fanning inflation, the economic slowdown has removed close to $90bn (£76bn) from global ad market growth prospects this year and next.”
Social media companies will bear the brunt of the fallout from the changes to third-party cookies. Apple’s move alone, which will block third-party cookies across two billion devices, will remove close to £34bn from the bottom line of these social media companies through to 2023.
Social media giant Meta has already felt the squeeze, with its first ever advertising income decline during Q2 2022.
McDonald said: “Platforms with rich sources of first-party data — most notably Amazon, Google and Apple — are well placed to weather future headwinds by offering measured performance in a climate where return on investment becomes paramount.”
Despite the cost of living crisis, only four out of the 18 product sectors monitored by Warc are expected to cut their adspend in 2023: transport and tourism; alcoholic drinks; financial services; and automotive.
Across all the sectors monitored by Warc, technology and electronics is set to lead market growth and spend a total of £71.2bn in 2022-23.
Warc’s new projections are based on 100 markets worldwide.
This article first appeared on campaignlive.com.