The latest report prepared by our advisors on the sale and purchase of companies in the technology sector provides an overview of the advertising agency sector. It contains all the data on companies, acquisitions and financing rounds, updated to June 2025.
The advertising agency market comprises professional service firms specialized in the planning, creation, and management of advertising campaigns on behalf of their clients. These agencies operate through multiple media formats to execute marketing strategies aligned with their clients’ business objectives, including brand recognition, lead generation, and sales conversion. For the purposes of this analysis, specifically excluded are adjacent but distinct markets such as marketing technology software providers, influencer marketing platforms, media buying networks, and public relations consultancies, which, although they may serve complementary functions, represent independent verticals within the marketing services ecosystem.
Trends that are revolutionising the Advertising Agencies market
- Transition toward performance- and results-based hiring models
Agencies are increasingly being compensated based on measurable outcomes such as leads generated, conversions, and return on advertising investment, rather than billing by hours or creative deliverables. - Internalization of advertising functions by major brands
Companies are bringing core marketing functions in-house, particularly media buying and content production, with the goal of reducing costs and improving execution speed. - Ethical advertising, privacy, and readiness for first-party data
The gradual elimination of third-party cookies and new privacy regulations require agencies to focus on first-party data and authenticated channels, ensuring regulatory compliance and advertising effectiveness. Agencies with advanced martech integration, consent management, and CRM capabilities are positioning themselves as essential strategic partners, especially in privacy-sensitive sectors, making them attractive candidates for mergers and acquisitions. - Customer experience (CX) and full-funnel integration
Agencies must manage not only brand awareness and acquisition but also customer retention, loyalty, and post-purchase experience. - Transformation of the creative process driven by Artificial Intelligence
Generative AI tools (ChatGPT, Midjourney, Adobe Firefly) are accelerating ideation, iteration, and large-scale content personalization. - Rise of specialized boutique agencies and micro-networks
Clients are showing a growing preference for highly focused agencies with deep expertise in specific verticals, particular audiences, or specialized channels.
Investment Analysis in the Advertising Sector
Investment data in the advertising industry over recent years shows a clear downward trend since the peak reached in 2019. Funding volume peaked in 2019 at $14.7 billion, followed by a gradual decline. Although there was a temporary recovery in 2023 with $13.8 billion, the overall trend remains negative. Similarly, the number of investment rounds steadily decreased from approximately 1,400 annual deals to fewer than 1,000 in the most recent periods.
This decline reflects the maturation of the industry, the increase in consolidation among key market players, and a structural shift in capital allocation. Competitive pressure from platforms like Google, Meta, and Amazon has reshaped market dynamics, steering investors toward AdTech solutions, data-driven technologies, and scalable business models with recurring revenue.
It is important to highlight that advertising is a broad industry encompassing much more than traditional advertising agencies. It includes media networks, programmatic platforms, MarTech solutions, audience analytics, and content production. The observed decline in funding impacts the entire advertising value chain, underscoring the urgency for innovation and strategic repositioning across all segments of the ecosystem.
How is this market expected to grow?
Global advertising market estimates show a strong consensus among various analytical sources, with valuations ranging between USD 360-465 billion by the mid-2020s. Projections indicate a sustained annual growth of 4.3% to 6.4%, driven by digital transformation, the globalization of agencies, and ongoing demand for performance-oriented services.
Key Market Projections:
- Moderate long-term growth: CAGR of 4.7% through 2029 with an estimated valuation of $366.56 billion by 2024
- More optimistic outlook: Projection of a higher CAGR at 6.4% with a market value reaching $463.49 billion by 2034
- Conservative estimates: Market value of $391.6 billion for 2023 with a more moderate CAGR of 4.3% through 2027
- Alternative analysis: CAGR of 5.5% for 2023 with a slightly lower valuation of $360.87 billion
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Advertising Agencies Market Research 2025
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