The Paris Olympic Games, European Football Championship, and the US presidential election... Before 2024 even began, it was easy to predict that this would be a bumper year for the global advertising market. It will certainly reach record heights. This year, revenue in the sector is expected to climb by 7.8% to reach $989.8 billion in 2024 (excluding political adverts in the United States), according to the latest numbers from GroupM (WPP), published in June 2024. And that’s not all. Despite the lack of big sporting events, the advertising industry will continue to grow in 2025 (+6.8%), exceeding the symbolic threshold of $1,000 billion (1,057 billion). These forecasts are corroborated by Statista, according to which the global advertising market is expected to grow by 4.81% per year between 2024 and 2029 to reach $1,361 billion by then.

"Despite an overall tense environment, both geopolitically and economically, advertising investments and the advertising market in general are doing quite well," says Olivier Lenne, media, culture, tourism and leisure partner at Parisian firm Bartle. This is a surprising phenomenon, as periods of uncertainly typically result in corporations cutting their marketing budgets. "Previously, the advertising industry grew at the same rate as global GDP," says Ludovic Labal, portfolio manager at Banque Eric Sturdza. "But that is not the case today. Over the past three or four years, advertising is growing faster than GDP."

There are several reasons for this robust growth, particularly the increased digitalisation of society. "Before, in order to have customers, all you needed was a shop on a good street, offering quality products at a good price," says Humberto Nardiello, equity fund manager at DPAM. "But with e-commerce, every-thing changed. You could have the best app, sell the best products at the best prices, but without advertising, your shop simply doesn’t exist. In the dig-ital sphere, companies devote around 15% to 20% of their earn-ings to advertising, compared to approximately 5% historically for traditional shops. As our society becomes more digital, advertising revenue continues to grow."

This idea is shared by Alan Mudie, chief investment officer at Woodman Asset Manage-ment: "Companies are required to invest in advertising. It’s absolutely necessary to get their name out there and once they do, they must continue advertising in order to not lose market share."

Furthermore, the advertising sector has been hit by a continuous onslaught of technological advances. "These innovations carry the market upwards," says Jean Meneveau, associate director at Colombus Consulting Suisse, a current example of which is the integration of generative AI. "In the medium term, we're expecting moderate but respectable growth in the advertising market, at an average annual rate of 5% to 6% until 2026," says Olivier Lenne from Bartle.

Given this context, is now the right time to invest in the industry? "Overall, the advertising market is doing well, but not everything is perfect," says Jean Meneveau. That’s because advertising is not a homogeneous sector. It’s a large pie, similar to the size of Switzerland’s GDP, and it is shared among very different players. So while some segments are booming, others are sluggish.

At a macro level, the advertising market can be divided into two categories: digital, which represents 70% of revenue and is experiencing high growth, and non-digital (paper media, analogue television, radio, public signs, cinema), which has been declining since the 2000s. As a result, for example, revenue from the paper advertising market is expected to drop 3% in 2024, according to the report "This year, next year 2024", published in June by GroupM, while the digital market is expected to grow by 10%.

"Non-digital advertising will never completely disappear. Certain advertisers will maintain their channels," believes Alan Mudie of Woodman Asset Management. "But non-digital will increasingly become a niche market." Especially as the traditional players are moving more and more towards digital marketing. Nearly 30% of out-of-home advertising (OOH) is now on digital screens, which has led to expected growth in this specific segment of 11.5% in 2024. Television is also becoming more and more digital.

"Advertising is a very shifting landscape, where some segments are slowing down while others are picking up speed," says Ludovic Labal of Banque Eric Sturdza. "Linear television, for example, is dying. It isn’t bringing in new viewers, and its current audience is slowly declining. Children these days don't even know how to turn on a television! With less of an audience comes less advertising revenue. At the same time, digital television, which allows for very targeted advertising, is growing rapidly."

And for Jean Meneveau of Colombus Consulting Suisse, that’s the challenge: "Non-digital advertising is declining but it also has to reinvent itself at the same time. Everything is moving from offline, where advertising is anonymous, to online where it can be targeted and personalised. Non-digital isn’t quite there yet, but it's heading in that direction."

Compared to analogue, digital has significant advantages for advertisers. "In the 19th century, the businessman John Wanamaker said: ‘Half the money I spend on advertising is wasted. The trouble is, I don't know which half’. With digital technology, data and artificial intelligence, this quote is becoming less and less true. Advertisers increasingly know how effective their campaigns are." Olivier Lenne continues: "With the ability to follow performance, update in real time, target ads and offer a wide variety of options, advertising can be considered a good investment for advertisers, now more than ever."

Of course, the companies that are best able to benefit from this are digital giants such 
as Alphabet (Google), Meta (Facebook, Instagram), Amazon, Douyin (TikTok) and Baidu (read company profiles). "Big tech owns the advertising market and is growing it accordingly," says Ludovic Labal. But the story remains the same: there is a wide range of growth for these companies based on the segment in which they operate. In 2024 for example, search advertising grew by only 5.3% whereas retail media advertising was up 17.5%. "Right now everyone’s excited about retail media," says Labal. "It's very effective." The numbers don't lie: in 2016, Amazon generated more than $1 billion in advertising revenue. In 2023, it generated a staggering $46.91 billion.

But the future of advertising agencies, which create campaigns for advertisers, seems uncertain. Some people believe that companies such as French group Publicis, US-based Omnicom and UK firm WPP are doomed to disappear as artificial intelligence takes over their work, particularly in creative pursuits. Others believe these agencies aren’t going anywhere. Whatever happens, advertising is here to stay and pays off in a big way.