WPP Media has forecast Australia’s advertising market will grow 7.4 per cent in 2026, despite inflation, higher energy costs and pressure on household spending.
The forecast forms part of WPP Media’s global This Year Next Year Midyear Advertising Forecast, which says advertising revenue is growing faster than expected as AI investment reshapes search, commerce, social and video.
WPP Media global advertising growth forecast
Globally, WPP Media now expects advertising revenue, excluding U.S. political advertising, to grow 8.9 per cent in 2026. That is an upgrade from the 7.1 per cent growth forecast in December.
In Australia, the report says ad market growth is being supported by digital platforms, performance-led channels, government demand, small-to-medium businesses and digitally native brands.
Australia’s ad market outlook
The report forecasts Australia’s advertising market will reach AUD $31.1 billion in 2026. Content-driven advertising, which includes TV, audio, print and social video, is expected to account for 63.4 per cent of total ad revenue.
WPP Media expects content revenue to reach AUD $19.7 billion in 2026, up 5.2 per cent, before rising to AUD $21.2 billion in 2027.
However, the report points to a widening split between traditional content channels and performance-led digital platforms. Content’s share of total advertising is expected to fall to around 58 per cent by 2031.
Melissa Hey, Chief Media & Investment Officer at WPP Media Australia, said the local market continued to show resilience despite global uncertainty.
“Australia’s advertising market continues to demonstrate resilience, even against a backdrop of global uncertainty and as the broader economic backdrop becomes more challenging,” Hey said.
“Despite the re-acceleration of inflation, driven in part by rising global energy prices, the structural drivers of the advertising market remain firmly intact and advertising revenue growth remains resilient, with total market growth forecast at 7.4 per cent.
“Underpinned by continued shifts towards digital, sustained demand from both government and small-to-medium businesses and the rapid growth of digitally native and small-scale businesses, which are driving major growth in performance-driven channels, this outperformance is increasingly notable against a slowing economic outlook.”
WPP Media Australian advertising growth forecast
Retail media leads growth
Retail media is forecast to remain the fastest-growing channel in Australia. WPP Media expects it to reach AUD $2.3 billion in 2026, growing 19.5 per cent.
By 2028, retail media is expected to overtake total TV advertising revenue, with an 8.4 per cent market share and revenue of AUD $3.07 billion.
Search also remains a major growth channel. WPP Media forecasts search revenue will grow 9.5 per cent in 2026 to AUD $7.25 billion.
When generative search advertising is included, growth rises to 10.4 per cent. The report defines generative search as advertising in AI-led discovery environments, including AI-generated search experiences and standalone conversational AI products.
TV and audio remain under pressure
Total TV advertising is expected to continue its structural decline, even with video-on-demand included. Revenue is forecast to fall to AUD $3 billion in 2026, down 6.2 per cent, before declining to AUD $2.8 billion in 2027.
Video-on-demand is forecast to account for 29 per cent of total TV revenue in 2026. By 2031, WPP Media expects that share to reach 66 per cent.
Audio is also forecast to decline, with revenue expected to fall to AUD $1.2 billion in 2026, down 4.1 per cent. A further 1.4 per cent decline is expected in 2027.
OOH remains a traditional standout
Out-of-home remains the strongest performer among traditional channels. WPP Media forecasts OOH revenue will grow 7.1 per cent year-on-year to AUD $1.55 billion in 2026.
Revenue is expected to reach AUD $1.64 billion in 2027, supported by continued demand for digital OOH, retail environments and audience recovery.
Cinema is also forecast to grow, with WPP Media expecting a 3.6 per cent increase in 2026 and similar growth in 2027, despite pressure on discretionary spending.
AI reshapes the global forecast
WPP Media frames the global market as being shaped by a modern AI “gold rush”, with major technology firms investing heavily in data centres, compute and power infrastructure.
The report says generative search is expected to be the fastest-scaling new advertising channel it has measured. It is forecast to reach around US$5.1 billion globally in 2026, US$32 billion by 2028, and more than US$100 billion by 2030.
Global content-driven advertising is forecast to reach US$720.2 billion in 2026, growing 8.2 per cent year-on-year. However, content’s share of total advertising revenue is expected to fall from 57.5 per cent in 2026 to 55.5 per cent by 2031.
The report also highlights the growing concentration of global ad revenue. Excluding China, Alphabet, Meta and Amazon now represent 57.6 per cent of total advertising revenue, while the top 25 sellers globally represent around 75 per cent.