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Things are looking positive in the digital advertising world.
This week, the Interactive Advertising Bureau (IAB) released its 2025 Outlook report, which digs into ad spending trends for the new year. The report is based on a survey of buyers at brands and agencies to better understand their growth strategies, anticipated spend by channel, and any challenges they might come across.
According to the findings, digital is set for a huge boost in 2025.
“This report clearly shows that budgets are being focused at the points where consumers, commerce, and video converge—where advertisers can leverage the power of sight, sound, and motion and consumers can engage or transact,” David Cohen, CEO, IAB, said in a statement. “Advertisers are starting the year looking for growth and investing in channels that drive the most meaningful business results.”
With companies already starting to plan around NewFronts and upfronts, here are some of the key takeaways from the results:
Double-digit growth expected for CTV, social media, and retail media
While overall ad spend growth is projected to be lower than in 2024 (which jumped thanks in part to the Olympic Games and the presidential election), IAB research shows an anticipated growth of 7.3%, even sans those cyclical events.
Meanwhile, retail media is projected to grow at more than twice the rate of spend overall (+15.6%). The report notes that CTV and social (apparently despite a looming TikTok ban) also expect to see double-digit growth with an increase of 13.8% and 11.9%, respectively.
Buyers are pursuing growth despite inflation, fragmentation, and measurement challenges
The IAB study shows that buyers aren’t being deterred by ongoing obstacles, including fragmentation. According to the findings, customer acquisition is still a main priority and is expected to increase 12% year over year as buyers look for revenue growth to offset shrinking margins from inflation.
Additionally, the fragmented ad landscape has the buy-side changing its marketing mix models, along with strategies to improve reach and frequency, per IAB.