Interpublic Group’s Magna forecasts a 15.1% increase in 2021 U.S. media ad revenue, now expected to reach a record $259 billion. Magna says this represents the strongest ad revenue acceleration in 40 years.

The new forecast, an all-in tally including cyclical events (U.S. elections, Olympics), is significantly higher than Magna’s March forecast that predicted ad revenue growth of 6.4%.

The change is due to a better-than-expected start of the year and an increasingly strong economic outlook for the coming months, according to the report. Excluding cyclical events, Magna forecasts that U.S. ad revenue will rise 17.4%.

WPP’s GroupM last week released a forecast showing a similar trend. GroupM predicts 16.5% media ad revenue growth in the U.S when including political ads. GroupM’s forecast jumps to 22.3% revenue growth when factoring out political ads.

Globally, Magna predicts advertising spend will grow by 14% to $657 billion, a new all-time high, following a decline of 2.5% in 2020. 

U.S. ad growth will be driven by digital advertising, which has been “red hot” since the second quarter of 2020, according to Magna’s report. U.S digital ad revenue will see 24% growth this year. This number includes “ad sales from all vendors, but pure digital players are going to grow a lot more (30% or more), while the digital ad sales of traditional media owners will grow more moderately (under 20%),” said Vincent Létang, executive VP-global market research at Magna and author of the report, told Ad Age.

“As economic recovery is stronger and faster than anticipated in several of the world’s largest ad markets (U.S., U.K. and China, in particular) and consumption accelerates, brands need to reconnect with consumers,” Létang said in a statement. “At the same time, the acceleration in e-commerce and digital marketing adoption that started during COVID, continues full speed into 2021, fueling digital advertising spending from consumer brands as well as small and DTC [direct-to-consumer] businesses.” 

U.S. non-political linear advertising sales—linear TV, radio, print, out-of-home and cinema— will increase by 4% to $81 billion in 2021. But due to the lack of political spending this year, total linear ad sales (including political) in 2021 will be merely stable vs. 2020, according to Magna.

Linear ad spending was slow to recover in the first quarter of this year, with first-quarter ad sales down compared to 2020, but Magna believes the return of sports and consumer mobility will help stabilize the market in the next three quarters.

Within linear media, out-of-home will show the highest growth (11%) compared to last year, which saw a 25% decline.

National TV ad sales will grow by 5%, boosted by stronger pricing and incremental spending around the Tokyo Olympics.

Magna also believes the recent merger announcement between AT&T’s WarnerMedia and Discovery is the first of a new wave of consolidations to come in the media industry.

“Facing stagnation in linear media consumption and linear ad sales that are still the bulk of their business revenues, traditional media companies have no choice but to grow in scale, in order to compete with digital media giants and invest in cross-platform advertising solutions,” according to the report.

“Traditional media owners are moving now as they believe antitrust authorities are ready to consider market shares in the broader media market and thus approve horizontal consolidations that would have been unthinkable just five years ago.”