The global advertising market is slowing down due to growing economic uncertainty, trade barriers and tightening regulation. According to WARC's latest study, ad spending growth will decline by $20 billion over the next two years.
WARC's new study shows that global ad spending will grow 6.7 percent this year to $1.15 trillion, but that is nearly one percentage point less than projected in November. The estimate for 2026 was lowered another 0.7 percentage point to 6.3 percent.
This is due to rising economic uncertainty, the threat of stagflation and recession in major world economies, as well as rising trade costs caused by US tariffs. The situation is further complicated by tightening regulation in the EU, low consumer and business confidence and rising costs for manufacturers.
According to James McDonald, director of data and forecasting at WARC, the advertising market is facing increasing uncertainty due to trade barriers, the economic slowdown and tighter regulations, which have led to a $20 billion reduction in growth over the next two years. This is being felt most acutely by automakers, retailers and technology firms, which are beginning to cut back on their advertising budgets due to higher production costs and supply chain issues.
Despite this uncertainty, digital advertising remains strong, largely due to the dominance of Alphabet, Amazon and Meta, which are expected to control more than half of the total market by 2029. However, regulation and the unclear future of TikTok in the US may introduce further risks to this development. McDonald therefore warns that advertisers will need to adapt to changing conditions to remain competitive.
WARC has presented three possible scenarios based on extensive market analysis. The baseline model is based on current economic conditions, while the more pessimistic option envisages the global introduction of 10 per cent tariffs, which would reduce GDP in key economies and increase inflation. The worst-case scenario then assumes an even sharper slowdown in global economic growth. If the Organisation for Economic Co-operation and Development (OECD) model came to pass, it could reduce advertising market growth by a further four billion dollars.
According to WARC, the effects of trade conflicts will be felt in the advertising market as early as the second half of this year and even more so in the first half of 2026. In particular, planned US tariffs, including a 20 per cent tariff on Chinese goods and further measures against Canada and Mexico, could cause further economic shocks. The advertising industry is thus entering a period of uncertainty, where how flexibly brands can adapt to new conditions will be key.
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