For proof of the uncertainty facing marketers in 2025, look no further than the industry’s ping-ponging projections for ad spending.
WPP Media (the former GroupM), which released its global midyear ad spend forecast on Tuesday, is just the most recent example.
Like every prognosticator that’s taken a crack at predicting spending trends for 2025, WPP Media had to revise its previous projections downward due to pressure on marketing budgets from the Trump administration’s proposed tariffs.
WPP Media now expects global ad spend to grow by 6% in 2025, down from its previous projection of 7.7% made in December.
But there are a few bright spots.
User-generated content (UGC) is seeing tremendous growth driven by generative AI. And retail media is set to continue its meteoric rise, with commerce-related ad revenue surpassing TV for the first time this year.
Revising down
Although WPP Media expects tariffs to be a drag on global ad budgets, its 1.7% downward revision is far from a worst-case scenario.
In fact, WPP Media predicts that, based on the current economic picture, there won’t be a global recession this year. Some good news for a change! But if the US takes a harder line in its global trade policy, all bets are off.
Even with the downward revision, WPP Media’s current projection of a 6% growth rate would still represent nominal positive growth, said Kate Scott-Dawkins, global president of business intelligence and lead author of the report.
At that growth rate, total 2025 ad revenue will reach $1.08 trillion.
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Plus, it’s likely the impact of President Donald Trump’s proposed tariffs won’t be as intense as originally thought. While Trump has threatened 10% baseline tariffs on just about every nation, he’s largely backed down from the higher tariff rates he’d previously threatened against nations like the UK, Canada and Mexico.
Which means any major impacts on marketing budgets should be isolated to the US and China markets, which remain embroiled in a “trade back-and-forth,” Scott-Dawkins said.
WPP Media predicts US ad spend will grow 5.6% this year, down from its earlier projection of 7%, while the Chinese ad market will grow by 6.8%.
In response to the tariffs, some marketing activity that had been earmarked for the US and China will likely shift to European markets, especially the UK and Germany, Scott-Dawkins said.
For example, Temu and Shein have already redirected some of their US ad spend to Europe, she said.
AI aiding UGC
But enough about tariffs.
The proliferation of generative AI technology – and the ease with which users can deploy the tech to create monetizable content – was another key theme in the report.
In fact, WPP Media is predicting that 2025 will mark the first time UGC will account for a greater share of ad revenue than professionally produced content – which is wild.
But there’s some nuance here worth noting, Scott-Dawkins said, as the line continues to blur between UGC and professional content. For example, WPP included TikTok revenue in its UGC assessment, but didn’t break down professional vs. amateur content creators on the platform.
Meanwhile, WPP Media also anticipates that AI will rapidly accelerate the shift to UGC by advertisers and consumers alike – and WPP isn’t alone in that assessment.
As part of its forecast, WPP Media polled a group of 60 ad industry experts on their predictions for how the market will evolve by 2030, and most were bullish on the AI-driven UGC revolution.
In fact, 63% said they expect that by 2030 the majority of audiences will consume news from individual creators and/or AI-generated bots.
Sounds like a recipe for the propagation of user- and AI-generated misinformation. Will that be a boon for brand safety vendors?
It’s hard to say. WPP Media doesn’t include assessments of mar tech or ad tech spending in its annual estimates, Scott-Dawkins told AdExchanger.
Social media bots are good now
One thing is for certain, though: AI chatbots will also reshape social media.
Sixty-six percent of the experts polled by WPP Media expect that by 2030 most consumer interactions with brands will happen bot-to-bot – with a consumer’s AI shopping agent communicating with a brand’s AI marketing agent.
Fifty-two percent expect public social media feeds will become dominated by promotional content from brands, which will include this type of bot-to-bot interaction – and what a weird future that could be. Roughly 39% of experts believe that more than half of the users on social media will be AI-generated personas by 2030.
Bafflingly, 66% said they don’t expect AI will diminish consumer spending power by 2030. That’s despite Dario Amodei, the CEO of AI startup Anthropic, predicting AI tech could eliminate 50% of entry-level white-collar jobs within the next five years and the US unemployment rate for recent college graduates already being 1% higher than the national rate.
But although marketers are clearly expecting the bots to take over online interactions, 63% say it’s unlikely that people will spend more time in the virtual world than the real one by 2030.
So, while many marketers may be happy for consumers to “descend into our chatbot caves,” as Scott-Dawkins put it, they’ll still need to reach consumers in the real world, too.
