The global ad market is booming, with spend forecast to reach $1.19 (£1.04) trillion in 2025, up 8.9 per cent from last year, according to WARC’s recent report.
Growth is projected to accelerate to $1.30 trillion in 2026 and $1.40 trillion by 2027, a doubling in size since the pandemic.
But while the market is swelling, the gains are increasingly concentrated in the hands of Big Tech.
Alphabet, Amazon and Meta now capture 56.1 per cent of global ad spend outside China, equal to $556.6bn this year and set to rise to 58.8 per cent by 2027.
For British agencies, that leaves a rapidly shrinking slice of the pie.
Alex Brownsell, WARC’s head of content, describes the market as having “broken away from the economic cycle”.
“New money has arrived from digital-native categories, while commerce has redrawn the measured media map, and Big Tech’s self-reinforcing flywheel is harvesting almost all incremental dollars”, he added,
Inflation, stagnant wages and higher borrowing costs have dampened household spending, yet ad budgets keep climbing – driven by data-driven channels.
Retail media alone now accounts for nearly 15 per cent of global spend, while sectors like ‘clothing & accessories’ channel over 80 per cent of incremental budgets straight into search, social and retail media platforms.
Meanwhile, younger platforms like TikTok and Reddit have become exceptions, growing faster than incumbents but from a small base. TikTok is projected to net $45.2bn in ad revenue by 2027, which is less than a fifth of Meta’s take.
UK agencies feel the squeeze
Back in London, the concentration of ad spend is hitting home.
M&C Saatchi saw shares tumble 11.9 per cent after cutting profit forecasts, blaming a delayed US government contract that won’t be recovered in 2025.
But S4 Capital has fared even worse, with shares down nearly 50 per cent year-to-date amid slow client wins and broader market caution.
It seems that advertisers are increasingly bypassing agencies, opting instead to spend directly with Big Tech for faster results.
Digital channels now account for 81 per cent of UK ad spend, and the shift toward platforms is only accelerating.
Meta reinvests roughly 30 per cent of quarterly earnings into AI and R&D, fuelling Reels and Advantage+, which attract more advertisers.
For its part, Amazon leverages its retail and entertainment ecosystems to optimise campaigns across platforms like Prime Video or Spotify, and its own e-commerce properties.
Meanwhile, Google dominates search and YouTube, even as its display network suffers a third consecutive year of declining revenue.
And as a result, Big Tech’s growth keeps on feeding on itself, leaving agencies with lower margins and shrinking influence.
Regulation backs Big Tech
Even regulation is tilting in favour of the giants.
The EU’s ‘Digital Omnibus’, proposed last month, updates GDPR and e-privacy rules, allowing AI training as well as easing consent requirements.
While the reforms simplify compliance, they disproportionately benefit platforms with the scale and tech expertise to exploit AI and first-party data.
In turn, this leaves smaller UK ad tech vendors and publishers at a disadvantage.
Even as the UK overtook Japan in 2022 to become Europe’s largest ad market – now valued at $58.1bn with growth of 9.3 per cent forecast in 2025 – the benefits of this growth are increasingly drained by global platforms.
Across Europe, incremental ad dollars continue to flow overwhelmingly to Big Tech, leaving traditional agencies and open-web publishers struggling to keep pace.