Amid the political and economic uncertainty in the United States, ad spend will likely grow, but at a much slower pace, over the next five years.
In a new ad forecast published on Tuesday, Madison and Wall has reduced its expectations for non-political advertising growth in 2025, down from 4.5% to 3.6% for the coming year.
But given the level of uncertainty that’s been injected into the ad space, the actual growth rate could be far better – or far worse.
“The range of possible outcomes is really wide,” Principal Analyst Brian Wieser told AdExchanger. There are a lot of reasons to expect things to get worse before they get better, particularly as the US government continues to pursue more autarchic and autocratic policies.
The predicted growth rate of 3.6% will continue mostly unchanged over the next few years, with a possible uptick in 2028 resulting from the Los Angeles Olympic Games, the advisory firm suggests.
Even if Madison and Wall’s prediction holds, the small increase might be nominal due to higher inflation rates and reduced stability, and might not represent “real” growth, said Wieser.
Breaking things
How bad would things have to get for the growth rate to decline rather than stagnate?
Pretty bad, said Wieser – which isn’t outside the realm of possibility right now, given that autocratic political structures often make for substantially less efficient economies. And that’s not even taking into account the impact of firing thousands of federal employees and ending long-held bureaucratic policies, as DOGE has been doing for the past several months.
“‘Move fast and break things’ is not the spoken mantra, but it is the mantra,” Wieser said, referring to the now-infamous slogan once used by Facebook. “There are all sorts of consequences that are going to follow that intentionally have not been thought through.”
Another potential consequence to consider, he said, is that other countries may start avoiding doing commercial business with the US at a more aggressive rate.
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That avoidance includes digital platforms, too, by the way. As an example, Wieser directly cited actions that Europe, Canada and Australia have already taken to push back against Meta and Google, but on a much larger and more limiting international scale.
“If you have less global scale to invest against, then you just can’t be as efficient,” Wieser said.
Taking things
But don’t feel too bad for digital platforms; their reign over the larger advertising industry isn’t coming to an end anytime soon.
Madison and Wall’s new forecast predicts that digital advertising will continue to gain a larger share of spending and industry revenue, from 67% in 2024 to possibly 79% in 2030.
What’s more, there still might be room to grow – not to 100%, Wieser said, but possibly 90%.
That’s because digital platforms are great at storing data, targeting users and hosting content, without the cost and challenges of being content-oriented the way that publishers are, he said. Meanwhile, marketers are more focused on business outcomes, which don’t necessarily rely on content, either.
There’s also no evidence to suggest that these platforms are losing enough of their audience to affect these outcomes, even as daily active user rates have declined in recent years.
“It’s possible people get sick of the algorithm,” Wieser said, but it’s also just as likely that marketing channels will simply evolve to fit whatever comes next, whether that’s messaging vehicles like WhatsApp or the newer iterations of AI-influenced SEO.
And then what?
With all this in mind, one might wonder: What’s the point in trying to predict how the ad industry will grow when things are so unpredictable right now?
“You know you’re gonna be wrong,” Wieser said. “All you can do is try to identify the things that you know are going to happen. You want to be intentional about the underlying narrative and how that narrative is expressed in data.”
In the meantime, he advised that marketers plan for all these negative scenarios if they’re not doing so already.
“We have a lot of non-zero probability of really, really terrible outcomes,” he said. “And no evidence that I’ve seen suggests an extreme upside.”
