Winterberry Expects Advertising and Marketing Spend to Top $500 Billion in 2023
Despite the anticipated economic downturn, management consulting firm Winterberry Group expects U.S. advertising and marketing spend to top $500 billion this year.
This year Winterberry Group predicts that advertisers will spend an estimated $509.2 billion, an increase of 5.89 percent from 2022's $480.8 billion. Of the total, the firm expects more than 60 percent ($307.3 billion) to be spent on online channels, with the greatest growth on channels that include connected TV (CTV), digital out-of-home (DOOH), and influencer marketing. CTV is expected to grow 27 percent, while DOOH and influencer channels are growing at rates of 10 percent and 17.5 percent, respectively.
Winterberry expects offline total spend to drop to $201.9 billion, with newspaper, magazine, radio, and linear TV being the top channels expected to decline between 1 percent and 8 percent.
The research points to a marketing and advertising shift within digital, even more important than the shift to digital. Additionally, the modernization of data infrastructurewill continue as artificial intelligence and machine learning solutions require speed and power, it concluded.
"The rising cost of digital media and shifting consumption patterns is encouraging marketers to shift spend, not just among channels but among providers who have the ability to target hard-to-reach niche audiences," Winterberry Senior Managing Partner Bruce Biegel says. "We expect the growth rate of digital channels to decelerate but remain strong. Offline bright spots for marketers include experiential marketing as events return and direct mail, as a predictable performance media channel."
Winterberry Group's 2023 Outlook also projects complex data segments, including data, data services, identity and platforms, to grow to $34 billion, up 7.4 percent from 2022. The increase is led by the rise of data-driven digital media ad spend and a focus on analytics, data infrastructure, identity and the need to build first-party, consent-based relationships, it said.
A big part of that ongoing investment will take place in data infrastructure, including customer data platforms (CDPs), clean rooms, and cloud provider solutions, Winterberry concluded, noting that as first-party data sets grow, the demand for CDPs that are compliant and secure will increase.