Artificial intelligence (AI) is on track to revolutionize the global advertising industry, with AI-driven content expected to influence a staggering 94.1% of ad revenue by 2029. This milestone, which is forecasted to be achieved three years earlier than initially predicted, underscores the accelerating role of AI in shaping the future of advertising.
According to the 2024 Global Midyear Advertising Forecast, AI is poised to become an indispensable tool for advertisers, driving targeted and highly personalized ad content at scale. This shift marks a significant transformation, as AI technologies continue to reshape how advertisements are created, optimized, and delivered.
Digital Advertising Dominates, But AI is the Game Changer
As of 2024, digital advertising continues to lead the industry, commanding 70.6% of global ad revenue, or approximately $699 billion. Within this growing digital space, retail media is emerging as one of the fastest-growing segments. Retail media refers to advertisements placed on online retail platforms like Jumia and Konga in Nigeria, where businesses can target consumers based on their shopping behavior and preferences.
The report also highlights the surging popularity of Connected TV (CTV), with a projected 20.1% year-over-year growth in CTV ad revenue, expected to reach $38.3 billion in 2024. CTV includes internet-connected TVs, streaming services like Netflix and YouTube, and gaming consoles, all of which allow advertisers to deliver data-driven, targeted ads. As viewers continue to move away from traditional TV and embrace streaming services, CTV presents a major opportunity for advertisers looking to reach specific, tech-savvy audiences.
AI-driven machine-generated content is seen as a key factor in this shift, enabling advertisers to create more engaging and customized ads at scale. The AI revolution is expected to dramatically enhance the efficiency and effectiveness of digital advertising, allowing businesses to better engage with their audiences.
Traditional Media Faces Challenges
While digital platforms continue to thrive, traditional media channels like television, print, radio, and cinema are experiencing slower growth or outright declines. Consumers are increasingly migrating to digital spaces, where they can access content on-demand and enjoy more tailored experiences.
However, there is a bright spot for traditional media in the form of out-of-home (OOH) advertising. Billboards, transit ads, and other forms of outdoor advertising have seen a resurgence, benefiting from increased consumer engagement and greater visibility in high-traffic public spaces.
The Growing Influence of AI Beyond Advertising
AI’s impact is not limited to advertising. Its reach is expanding across multiple sectors of the global economy. A recent report by Public First, commissioned by Google, projects that AI could contribute over $30 billion to Africa’s economy over the next decade. The report highlights AI’s potential to transform industries such as healthcare and agriculture, where AI-powered technologies can improve diagnostic accuracy, optimize resource use, and boost productivity through data analytics and precision farming.
In Africa, AI is seen as a crucial driver of economic growth, with the report suggesting that AI’s integration into Africa’s digital economy could unlock vast opportunities. Google’s tools, including Search, Maps, and YouTube, helped generate $16 billion in economic activity in 2023 alone, further illustrating the growing role of AI in fostering innovation and supporting local entrepreneurs.
For governments and businesses to fully harness AI’s potential, the report calls for policies that prioritize cloud infrastructure, promote STEM education, and create continuous learning opportunities. It also advocates for the development of diverse and high-quality datasets to ensure responsible AI development and the creation of ethical regulations.
What’s Next for the Advertising Industry?
The rapid growth of AI-driven technologies is poised to redefine advertising as we know it, creating both challenges and opportunities. As AI continues to reshape digital advertising, businesses will need to stay ahead of the curve by embracing these new technologies and adapting to the evolving landscape. With 94.1% of global ad revenue expected to be influenced by AI by 2029, the future of advertising is undeniably technology-driven.
The integration of AI, coupled with digital advertising’s ongoing dominance, will likely lead to even more targeted, personalized, and effective marketing strategies. As traditional media channels face increasing pressure, the shift towards digital and AI-powered advertising is clear—and the companies that can successfully adapt will be best positioned to thrive in this rapidly evolving market.
