U.S. ad spending will experience lower-than-anticipated gains this year as a result of Russia’s continuing war with Ukraine, according to a new forecast.
Magna reports that media owners' advertising revenues will grow by 11.5% this year—a single percentage point below the 12.6% growth the IPG shop had previously forecast for 2022. Revenue is expected to reach $320 billion this year, exceeding the $300 billion mark for the first time, as the earlier forecast anticipated.
“Now with Ukraine, economic growth will be slightly lower and how much lower no one can tell, it depends how bad how long this geopolitical crisis will be,” said Vincent Létang, executive VP of global market intelligence at Magna.
In the report, he wrote that “the Ukraine crisis has already hit consumer and business confidence,” and noted that such economic repercussions now factor into Magna’s ad forecast. Magna expects spending in categories hit hard by supply chain issues, such as automotive, to suffer while industries such as technology, telecom, entertainment, travel and betting are expected to grow.