Global advertisers are signaling a decisive shift in their media spending strategies for 2025, emphasizing performance marketing over traditional branding, according to the latest Annual Media Budgets Survey by the World Federation of Advertisers (WFA) and Ebiquity. The survey, which collected responses from 134 brand leaders representing over $66 billion in ad spend, provides a snapshot of industry priorities amid economic uncertainty and transformative technological change.
Key Trends: Performance Marketing and Retail Media Lead the Charge
A central finding of the report is that 42% of advertisers plan to increase their allocation to performance marketing in 2025, continuing a trend observed in recent years. Retail media, which has grown significantly as a channel, is identified as a key driver of this shift. One respondent noted, “The increase of performance is related to retail media,” reflecting broader industry sentiments about the channel’s potential for measurable returns.
The growing prioritization of performance marketing is not without concerns. While this approach promises short-term gains, some advertisers worry about its impact on long-term brand equity. As one respondent cautioned, “The need to measure is causing budgets to shift to performance, even though the measures do not always equate to effectiveness.”
Geographic and Channel Insights: Europe Rebounds, TV Declines
Regionally, Europe appears to be rebounding from previous challenges, with 51% of respondents in the Europe, Middle East, and Africa (EMEA) region expecting to increase their budgets for the coming year. In contrast, North America showed a more cautious outlook, reflecting fears of recession and political uncertainty.
Media channel allocations are also evolving. Traditional linear television is expected to see continued budget declines, while connected and addressable TV formats gain traction. Similarly, channels like digital video, influencer marketing, and retail media are projected to attract higher spending as advertisers adapt to consumer shifts.
AI in Media: Hype or Transformation?
The integration of artificial intelligence into media operations is poised to accelerate. According to the survey, 69% of advertisers expect moderate to significant changes to their media practices due to AI. Applications such as campaign optimization, creative generation, and dynamic pricing are already being tested, although advertisers acknowledge the need for robust measurement frameworks to manage these advancements effectively.
Stephan Loerke, WFA CEO, emphasized the dual-edged nature of AI’s impact, stating, The next wave of transformation may come from AI – an area from which the impact can still only be loosely gauged. We need to prepare for this transformation but not before implementing the measurement frameworks we need for today, not least to ensure we can measure across an increasingly fragmented ecosystem.” This sentiment reflects a broader industry push for accountability amidst rapid technological adoption.
Context: Broader Industry Challenges and Opportunities
The report’s findings come against a backdrop of economic uncertainty, with inflationary pressures and concerns about the global talent pool complicating budget planning. At the same time, advertisers are increasingly prioritizing sustainability, recognizing its growing importance for brand reputation and regulatory compliance.
This year’s study reflects an industry at a crossroads, balancing immediate financial returns with the long-term health of brands. As 2025 approaches, the convergence of technology, consumer behavior, and economic factors will likely continue reshaping the media landscape, challenging advertisers to remain agile and forward-thinking.