Going into 2025, the advertising industry is expanding favorably, particularly for media firms that own sports rights and major live programs.
When media executives were asked about their predictions for the advertising market in the upcoming year, sports and live events like awards presentations were the most talked about topics. They said that the outlook has improved as a result of the election’s uncertainties being resolved.
Additionally, executives stressed that conventional TV is still significant in conversations with advertisers, particularly when it comes to sports, even if consumers are avoiding traditional TV bundles and more advertising money are flowing to streaming.
In general, CEOs stated that they want to overcome the current decrease in ad expenditure and anticipate market stability.
According to Mark Marshall, head of global advertising and partnerships at NBCUniversal, “normalization is the right way to say it with the advertising market.” “Many businesses believe the uncertainty surrounding that has subsided since the election was concluded.”
In the fourth quarter, he said, the business has witnessed a rise in so-called scatter market budgets, which the industry refers to as the purchasing and selling of advertisements closer to their airdate as opposed to those purchased farther out.
“We are having a great first quarter. According to Dan Porter, CEO of sports media business Overtime, “I think that any election year is challenging for anyone in the fourth quarter because a lot of marketers end up sitting on their hands because the airwaves and digital are crowded.” “I believe that applies to us as well as to everyone else.”
However, Natalie Bastian, global chief marketing officer at Teads, stated that she anticipates much of the same tendencies despite the increase in ad income after the election and the anticipated stability.
Bastian pointed out that significant events like the presidential election and the Summer Olympics in 2024 boosted TV ad income. But she anticipates that the same spending plans will remain in place for the upcoming year.
According to Bastian, “most of our closest partners have told us that media budgets aren’t increasing, so there’s just more choice in where [advertisers are] spending their money.” Because of this, media organizations place an even greater value on live programs and sports.
According to a recent analysis by GroupM, WPP’s media investment arm, the worldwide advertising sector is predicted to top $1 trillion in total revenue for the first time this year, excluding political advertising in the United States, and will expand 7.7% in 2025 to reach $1.1 trillion. That rise is being driven by digital platform advertising, which includes retail media as a sector.
TV, which is regarded as “the most effective form of advertising,” is predicted to increase by about 2% to reach $169.1 billion in worldwide ad revenue by 2025. In contrast, GroupM projects that ad income for “pure-play digital,” which includes YouTube and TikTok but does not include “the digital extensions of traditional media” like streaming, will increase by 10% to $813.3 billion globally in 2025.
Supporting athletics
Media firms pay high prices for the rights to games because sports continue to draw large audiences and marketers.
According to advertising analytics provider EDO, live sports commercials produced 24% higher engagement than other programs.
Tim Hurd, vice president of media at Goodway Group, stated that live event coverage will remain a vital component of media engagement and that streaming services need to improve. “The challenge will be to keep viewers interested as more streaming platforms get into sports, not just by providing content, but by improving the overall experience with tailored, non-disruptive ad units.”
The Summer Olympics in Paris brought in a record $1.2 billion in ad revenue, according to Comcast’s NBCUniversal. With the company announcing that over 30 million people watched NBC’s TV and streaming services, it seemed to have paid off.
According to Fox Corp. executives, the company has already sold out of Super Bowl advertisements for February, which are said to have cost roughly $7 million each. The expected number of viewers for the 2024 Super Bowl was 123.7 million.
Additionally, Disney announced that two weeks prior to the NBA games on Christmas Day, its advertising had sold out. The business also stated that it has “already seen early movement” for the postseason in the scatter market and that its ad income for the whole NBA season is “pacing up substantially” in comparison to previous year.
Over the past year, the WNBA in particular has increased the viewership for women’s sports, which has increased advertising potential.
“Even though Caitlin Clark is a huge catalyst, this is beyond her,” stated Josh Mattison, executive vice president of digital revenue pricing, planning, and operations at Disney Advertising. “In terms of audiences, this was a transformative year.”
According to EDO, the 2024 WNBA audience set a new record, and consumers were 16% more likely to interact with advertisements during these games than they were the previous year. However, according to EDO, women’s sports accounted for just 3% of the $8.5 billion that marketers spent on sports TV advertisements in 2024, meaning there is still lots of opportunity for development in the next year.
This month, Netflix acquired the U.S. rights to the FIFA Women’s World Cup in 2027 and 2031, demonstrating the expanding appeal of women’s sports and its significance for media businesses. Like its competitors in the legacy and digital media sectors, the streaming behemoth has been expanding its sports offering.
Linear significance
Even while customers are cutting the cord and streaming firms are now acquiring sports rights, linear TV still has a much larger viewership than streaming.
GroupM’s worldwide head of business intelligence, Kate Scott-Dawkins, stated that while certain foreign markets are experiencing growth, “linear TV is still declining in a lot of markets, but not in all markets.” “There are still a lot of opportunities when it comes to total TV, and hopefully there is a renewed understanding of how effective that can be as a medium [for advertisers].”
The business anticipates sustained increase in programmatic ad expenditure, or automated digital ad buying, in streaming, according to Amy Leifer, chief ad sales officer at DirecTV Advertising.
“In terms of ad impressions, linear TV still has a significant advantage, generating six times more than streaming, despite the shift towards streaming,” Leifer stated.
According to executives, they have been discussing with advertisers how to include both linear and streaming when allocating ad funds.
“TV is TV,” regardless of the delivery channel, is DirecTV Advertising’s motto, according to Leifer. “By taking a comprehensive approach and creating convergent TV solutions, our goal for 2025 is to unify digital and linear television advertising,” she continued.
According to Mattison of Disney and Marshall of NBCUniversal, marketers used to prioritize linear “versus” streaming. That is no longer the case.
“You really can’t look at one versus the other,” was the argument we made to marketers last year. It’s how you view digital and linear combined when it’s implemented on a single platform. “That’s made a huge difference,” Marshall said, pointing out that younger generations have shifted to streaming while elderly viewers are more prevalent on linear TV.
Marshall claimed that because there is minimal overlap between the material on the two distribution channels, NBCUniversal’s Peacock “hasn’t been cannibalizing linear.” Marshall stated, “It’s actually two different audiences.”
Disney’s broad sports portfolio and its many linear and streaming channels, including TV networks like ABC and ESPN and the streaming service ESPN+, which adds content to Disney+, have been advantages, according to Mattison.
“Consumers benefit greatly from the convergence [of the streaming apps], which boosts advertising,” he stated. “We’re lucky to have invested years in developing our streaming ad technology, which allows us to optimize audience reach, targeting, and performance.”
Perhaps it was linear versus streaming a few years ago. Now, I believe it’s both linear and streaming,” Mattison added. They are somewhat coordinated. Both the media and the advertisers agree with this.
