<\/p>\n
The world\u2019s biggest companies are spending a shrinking proportion of their revenue on advertising, even as the global advertising market surges towards a record $1.34 trillion.<\/p>\n
But for South Africa, the more pressing question is whether the advertising boom is benefiting local media companies and agencies or increasingly enriching the international technology giants that dominate the digital economy.<\/p>\n
Read: SA TV faces R6bn revenue decline as digital advertising surges<\/p>\n
New research released by global marketing intelligence group WARC reveals a fundamental shift in how major companies allocate their advertising budgets, with technology groups reducing advertising expenditure relative to their revenue while consumer goods companies move in the opposite direction.<\/p>\n
The findings come as South Africa\u2019s advertising industry undergoes its own transformation \u2013 driven by the growing influence of Google, Meta and other international platforms; the expansion of digital advertising; and the emergence of retailers as major advertising businesses.<\/p>\n
WARC\u2019s latest Global Ad Trends report finds that advertising expenditure as a proportion of revenue among 25 major US-listed companies fell from 6.1% in 2019 to 5.5% in 2025.<\/p>\n
This does not mean the companies are cutting their advertising budgets.<\/p>\n
Their combined advertising expenditure increased by 56% over the period, but revenue grew even faster \u2013 rising 73%.<\/p>\n
Alphabet, Meta, Microsoft and Netflix saw their combined advertising-to-sales ratio fall from 13% to 7.4% between 2019 and 2025, despite combined revenue surging 146% from $379 billion to $931 billion.<\/p>\n
WARC calculates that had these four businesses maintained their 2019 advertising intensity, they would have spent an additional $52 billion on advertising last year.<\/p>\n
The implication is significant<\/p>\n
Some of the world\u2019s most powerful digital businesses are becoming less reliant on paid advertising to generate revenue, partly because they already own the platforms, services, and customer relationships through which they reach enormous audiences.<\/p>\n
ADVERTISEMENT<\/p>\n
CONTINUE READING BELOW<\/p>\n
For South Africa, the findings highlight an increasingly difficult commercial environment for traditional media owners.<\/p>\n
The latest figures from the Interactive Advertising Bureau South Africa and PwC show that internet advertising revenue reached R17.7 billion in 2023, an increase of 21.5% on the previous year.<\/p>\n
Digital advertising accounted for 39.8% of the overall advertising market, up from 36.1% in 2022.<\/p>\n
The figures demonstrate the rapid expansion of digital advertising, but do not establish how much of that expenditure remains with South African-owned media businesses.<\/p>\n
That distinction has become increasingly important.<\/p>\n
In November 2025, South Africa\u2019s Competition Commission published the final report of its Media and Digital Platforms Market Inquiry, highlighting the damage caused to the country\u2019s news industry by the growing dominance of international digital platforms.<\/p>\n
Read:
Google may have to pay SA media up to R500m to use their news
Google to pay R688m to SA media houses following CompCom settlement
A R688m lifeline \u2013 but no salvation for SA media<\/p>\n
The inquiry found that the shift towards digital platforms had undermined traditional advertising revenue models, contributing to shrinking newsrooms, bureau closures, and reduced reporting capacity.<\/p>\n
It identified Google, Meta, Microsoft, TikTok, and other international technology businesses as important gateways through which South Africans access news and information.<\/p>\n
These platforms can monetise audiences and advertising opportunities that previously supported domestic publishers and broadcasters.<\/p>\n
Adding insult to injury \u2026<\/p>\n
The WARC findings add another dimension to this debate.<\/p>\n
While major international technology companies are becoming less dependent on advertising to promote their own businesses, many South African companies must purchase advertising space on those same platforms to compete for customers.<\/p>\n
ADVERTISEMENT:<\/p>\n
CONTINUE READING BELOW<\/p>\n
Read: Rising media inflation driving up costs for advertisers<\/p>\n
For local broadcasters, publishers and advertising agencies, the challenge is not necessarily that businesses are abandoning advertising.\u00a0It is that the channels through which advertising money flows are changing rapidly.<\/p>\n
New players<\/p>\n
The most striking South African development is the emergence of retailers as significant media owners.<\/p>\n
Shoprite, for example, has developed its Rainmaker Media business around the group\u2019s extensive retail footprint, customer information, and digital infrastructure, including its Xtra Savings loyalty programme and Checkers Sixty60 delivery platform.<\/p>\n
Read: How Shoprite built a R1bn-plus media, insights business in plain sight<\/p>\n
Rather than simply purchasing advertising to attract shoppers, the group also sells advertising and marketing opportunities to the suppliers whose products appear on its shelves and digital platforms.<\/p>\n
The commercial potential is already substantial.<\/p>\n
Shoprite reported R593 million in revenue from its marketing, media, and consumer insights activities during the 26 weeks to 28 December\u00a02025, with the business on course to generate more than R1 billion in annual revenue.<\/p>\n
This illustrates how the South African advertising market is evolving beyond traditional television, radio, newspaper, and outdoor advertising.<\/p>\n
Retailers with direct access to customers and detailed purchasing information are increasingly able to offer advertisers something particularly valuable: the opportunity to reach consumers close to the point of purchase.<\/p>\n
#SAs #advertising #boom #raises #questions #benefits<\/p>\n","protected":false},"excerpt":{"rendered":"
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