Artificial intelligence (AI) is set to play a transformative role in the advertising industry, with AI predicted to influence 94.1% of global ad revenue by 2029.
This milestone will be achieved three years earlier than previously forecasted, according to the 2024 Global Midyear Advertising Forecast.
Artificial intelligence (AI) is set to reshape advertising, with AI-driven content predicted to influence global ad revenue by 2029.
“By 2029, AI could inform 94.1% of ad revenue, three years earlier than previously predicted,” the report stated.
Digital advertising
In 2024, digital advertising continues to lead the global advertising industry, accounting for 70.6% of total ad revenue in 2024, equivalent to $699.0 billion.
“Digital pure-play advertising will account for 70.6% ($699.0 billion) of total ad revenue in 2024, with retail media remaining the fastest-growing digital segment,” the report stated.
- This highlights the dominance of digital platforms in the advertising space, with businesses investing heavily in digital channels to reach a larger audience.
- A key trend within the digital advertising sector is the rapid growth of retail media, which refers to advertisements placed on retail websites or apps, such as such as Jumia, and Konga in the Nigerian case where advertisers can target consumers based on their shopping behavior.
- As consumers increasingly shop online, retailers are becoming powerful players in the advertising ecosystem, leading to a sharp rise in retail media ad revenues.
Another major growth area is Connected TV (CTV), which is experiencing significant expansion. CTV refers to TVs connected to the internet through smart features, streaming devices, or gaming consoles, allowing viewers to access streaming platforms like Netflix and YouTube.
- In 2024, CTV ad revenue is expected to grow by 20.1% year-over-year, reaching $38.3 billion. This growth reflects the increasing shift in viewership from traditional TV to streaming services, where advertisers can more easily target specific audiences with data-driven ads.
AI-driven machine-generated content is poised to revolutionize how advertisements are created and delivered, playing a pivotal role in the shift towards a more technology-driven advertising ecosystem.
Challenges for traditional media
While digital platforms continue to thrive, traditional media channels are experiencing slower growth or even declines.
Advertising on television, in print, on the radio, and in cinemas is losing traction as consumers shift toward digital spaces.
However, out-of-home (OOH) advertising, such as billboards and transit ads, has seen a robust recovery, benefiting from renewed consumer engagement and increased visibility in public spaces.
What you should know
The role of Artificial Intelligence (AI) in the global economy is expanding rapidly. According to a report by Public First commissioned by Google, AI has the potential to contribute over $30 billion to Africa’s economy in the next decade.
- AI’s transformative power spans various sectors, including healthcare and agriculture, with the ability to improve diagnostic accuracy and enhance agricultural productivity through data analytics and precision farming techniques. “With AI, the future of Africa’s digital economy is bright and full of possibilities,” the report stated.
- The report also reveals that Google’s tools, such as Search, Maps, and YouTube, helped generate $16 billion in economic activity in 2023, with its $1 billion commitment to improve connectivity and innovation further supporting local entrepreneurs.
For African governments to harness AI’s potential, the report recommends policies prioritizing cloud infrastructure, strengthening STEM education, and creating opportunities for continuous learning. It also advocates for the development of high-quality, diverse datasets to support responsible AI development and ethical regulations.
