Forrester: CMOs are upbeat and advertising spend is stabilising

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According to Forrester, CMOs are approaching the end of 2023 with optimism and are prepared to invest with proven media partners.

The global marketing consultancy says in its Predictions 2024: Media And Advertising study that new confidence is emerging in the media world.

Major media has its mojo back, says Forrester.

And this is mainly due to generative AI and stabilizing advertising revenues.

Google, Meta and Amazon – the three largest digital advertising platforms in the world – have all posted better-than-expected results recently.

Amazon’s advertising revenue rose 26% to $12.06 billion in the three months to September, compared to the same quarter last year.

Google reported a 9% increase in advertising revenue to $59.65 billion. YouTube ad sales were up 12% at $7.95 billion.

Meta, the parent company of Facebook, Instagram and Threads, reported a stronger-than-expected quarter with advertising revenue of $33.64 billion, up 23% from the same three months last year.

And many of the major global advertising agency groups are predicting a positive ending for 2023.

Omnicom last month posted “strong” organic revenue growth of 3.3% in the September quarter, Publicis rose 5.3% and Havas 4.5% higher.

WPP disappointed for the September quarter as reported revenue fell 1.8% to GBP3.508 billion, but rose 2.3% on a like-for-like basis.

IPG reported a 0.4% decline in organic revenue growth in the September quarter, driven by cautious technology customers.

However, Forrester says with its B2C Marketing CMO Pulse Survey that marketers will take more risks in 2024 as media budgets stabilize and grow.

“B2C marketing teams are ready to shake off the past few years, after being shackled by a global pandemic and mired in economic uncertainty,” says Forrester.

“With most of that in the rearview mirror, CMOs will enter 2024 with optimism about the usual suspects of media partners – ready to build, test and learn.”

Forrester expects a year in which advertisers invest in proven media partners and experiment within ‘safe’ spaces.

“Media giants – Google, Meta and TikTok – may have had a few chinks in their armor over the past year, but they’re heading into 2024 with more power,” says Forrester.

“Several claims in the antitrust case against Google were dismissed in 2023, Meta is at a new high after a revenue increase in the second quarter, and TikTok is more popular than ever.

“As major media companies add new capabilities on top of their strong foundations, they will further strengthen their value with advertisers (and their budgets).

“Of course, generative AI will act as rocket fuel for most of these companies, tripping up marketers who don’t use it responsibly.

“Gen Z favorites, such as gaming platforms, TikTok and Instagram, will surpass legacy media channels as marketers realize their mainstream value in pursuing the next generation of consumers.”

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