Advertisers’ primary goals are increasing sales, whether directly through performance-focused marketing or indirectly via brand-focused marketing.
Whatever individual occupies the White House won’t change those goals to any meaningful degree. But that’s not to say advertisers’ investments won’t change depending on the direction of federal policy.
There are key variables that affect growth in advertising spend. Most important are consumer spending (or, more accurately, expected consumer spending) and changes in costs and/or competition within specific industries.
As we move into 2025 and beyond, there are a few areas where President-elect Donald Trump’s policy proposals will directly affect the advertising industry.
Tariffs
Trump has been proposing tariffs upward of 60% on imports from countries, including China and Mexico, and lower tariffs from others. Based on his actions during his previous term, treat these initial proposals as a starting point in trade negotiations. The final policy will likely look different.
Regardless of the final policy, tariffs will raise prices on consumers and businesses. Significant increases in tariffs will create a major headwind to advertising sales. Expect these headwinds to be felt particularly hard in H2 2025 and H1 2026.
We can expect:
- Increased prices on imports to negatively impact advertisers in categories such as apparel, consumer electronics and consumer goods. Firms will see higher costs, while raising prices on consumers to account for increased costs could lead to lower consumer spending.
- Consumer spending and advertising budgets for companies and marketplace sellers based in China will see more severe negative impacts. These companies have been a key driver of advertising sales growth on both social and retail media platforms, two of the main drivers of growth in the entire advertising industry.
- TikTok and other Chinese-owned media companies’ ability to operate in the US will be a key bargaining chip in trade negotiations.
Industry regulation
Potential policy changes at the FCC and FTC will affect companies’ relationships with regulators.
Brendan Carr, Trump’s appointee for chairman of the FCC, detailed a number of key policy priorities in the Heritage Foundation’s “Mandate for Leadership: The Conservative Promise” (part of Project 2025). These policy proposals should be treated as a wish list of where policies may go, rather than the agreed-upon platform.
Some of the potential policy priorities include:
- Regulation of Big Tech platforms.
- Adjusting and updating Section 230 of the Communications Decency Act, which legally protects online platforms from liability relating to third-party content on their platforms.
- Addressing national security concerns around TikTok, with the future of TikTok in the US likely becoming a bargaining chip in trade negotiations with China.
Notably, all three of these policies have bipartisan support and have been priorities in President Joe Biden’s administration. But details and policy prescriptions do differ substantially between the parties.
Project 2025 also lays out some policy priorities for the FTC. Regulating trade practices around children and teenagers online will be a key focus, which will put direct pressure on social media and platforms focused on user-generated video. Andrew Ferguson, Trump’s pick to lead the FTC, has signaled he will keep pressure on Big Tech firms, particularly as a result of alleged censorship and demonetization of conservative views and speech.
On the flip side, the FTC likely will also take a backseat on antitrust enforcement outside of Big Tech, giving more power to the DOJ and state attorneys general. Expect a surge in M&A in media, tech and advertising in 2025 and 2026, particularly with interest rates likely to fall.
Changes at the FDA may lead to changes in regulations around direct-to-consumer pharmaceutical advertising. Trump’s choice for Secretary of Health and Human Services, Robert F. Kennedy, Jr., has called for more robust regulation of pharmaceutical marketing, including a ban on TV drug ads.
This could be a significant blow, considering advertising from prescription pharmaceutical advertisers totaled $16.1B last year, while over-the-counter drugs, vitamins and supplements totaled $5.2B, roughly 5% of the entire advertising industry in aggregate, according to Advertiser Perceptions estimates.
Consumer spending will be in question
While the future state of tariffs and industry regulation remain uncertain for now, it’s likely any movement on either front will impact business costs, resources and consumer spending.
Preelection, Advertiser Perceptions estimated US ad spending would reach $434.05 billion in 2025, a 5% increase vs. 2023. Time will tell whether we’ll see that number in reality.
Looking forward, advertisers will face some headwinds. But it’s not their first rodeo. They have adapted to similar challenges over the past few years from constrained supply chains, inflation and a global pandemic. And ad sellers who have pivoted in response to the current economic environment and adjusted how they serve advertisers accordingly have gained market share.
We will be watching the economy and ad industry investments closely over the coming months, updating our estimates each quarter as the Trump administration’s policies become clear and identifying growth opportunities for ad sellers.
“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.
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