Analysis Media & Advertising Middle East to be world’s fastest-growing ad market By Andy Sambidge September 19, 2023 Pexels/Liza Summer Digital advertising is growing in Saudi Arabia and new rules provide guidance to influencers Worth $5.9bn in 2022 6.2% growth to $6.9bn next year Saudi Arabia alone worth $2bn The Middle East’s advertising market is on track to be the world’s fastest growing over the next two years, driven by Saudi Arabia’s ongoing transformation. The regional market, worth $5.9 billion last year, is forecast to grow 10 percent in 2023 and a further 6.2 percent in 2024, when its value will reach $6.9 billion. This is according to new figures supplied to AGBI by marketing consultancy Warc Media. Saudi Arabia is set to become a $2 billion market this year – the biggest in the Middle East. Online advertising continues to be the region’s biggest category, worth $3.6 billion. In June, Saudi Arabia won its first Grand Prix at the prestigious Cannes Lions International Festival of Creativity. Agency Wunderman Thompson won for its campaign The Subconscious Order, prompting Cannes Lion CEO Simon Cook to remark: “It’s inspiring to see new countries enter and win Lions to raise the creative bar on the global stage.” For Saudi Arabia, it represented a transformation that has been ongoing since 2016, when Crown Prince Mohammed bin Salman launched the Vision 2030 project to diversify the kingdom’s economy. Justin Harper, editor of Campaign Middle East, said that Saudi Arabia’s rapid cultural and economic transformation is driving a “new era” for advertising and marketing. In the past, international brands hoping to advertise in Saudi Arabia had to account for religious, linguistic and cultural hurdles. Blinx launches to cater to ‘tech-savvy youth’ UAE’s Multiply plans IPO after $61m ad agency deal Brands will jump on the social commerce bandwagon in Mena However, said Harper, “as its economy continues to grow, more companies are setting up operations in the kingdom, creating a need to promote their brands. “Like the steady flow of world-class footballers heading to Saudi, the advertising industry could also be in for an exciting ride.” Kamal Dimachkie, a board member of The Marketing Society in the UAE, agreed, saying Saudi Arabia's focus on promoting itself globally has created “numerous growth opportunities” for the advertising sector. “As Saudi Arabia continues to tell its story to the world, the advertising industry is set to play a crucial role in shaping its image and attracting investments in the years to come,” said Dimachkie, a senior executive with 36 years of experience in marketing and communications. Alex Brownsell, head of content at Warc Media, added that the Middle East advertising market will enjoy “fast growth” in 2024. He said as well as a “rapid expansion” of online spend, cinema, outside and radio advertising are also on the increase. Outdoor advertising, which reached $882 million in 2022, is forecast to hit $980 million this year. Radio attracted $178 million last year and is predicted to make $192 million in 2023. However, TV advertising is expected to remain flat this year at nearly $1.4 billion, while newspaper advertising is set to shrink from $331 million in 2022 to $313 million this year. Internet advertising is likely to rise by about $500 million to $3.6 billion this year. Brownsell said this growth is being driven by the “exceptionally high levels of digital media consumption” in the region. In the second quarter of 2023, social media users in the Middle East spent on average nearly four hours per day on platforms such as Instagram and TikTok, nearly twice the consumption levels seen in Europe, according to audience targeting company GWI. Saudi advertisers are embracing the digital age and Instagram influencers are growing in numbers. The introduction of "Mawthooq" (which means verified) guidance last year by the General Commission for Audiovisual Media aims to regulate and, where appropriate, license their activity. Figures from Warc Media show that while Saudi Arabia will continue to be the biggest Middle East market this year, the UAE ($1.6 billion), Israel ($1.3 billion), Kuwait ($362 million) and Qatar ($215 million) are also significant players. The UAE has witnessed a marked rise in mobile advertising in recent years. More than 90 percent of the population owns a smartphone. Globally, advertising spend is on course to grow by more than 4 percent this year and a further 8 percent in 2024, by when expenditure will have topped $1 trillion for the first time. The US will account for almost a third of global spend, rising 2 percent to $304 billion this year and then a further 7.6 percent to $327 billion in 2024. Warc Media data shows that just five companies – Alibaba, Alphabet, Amazon, Bytedance and Meta – will attract more than 50 percent of global spend this year and will consolidate that position into 2024 with a share of 52 percent. Market growth in 2024 is also likely to be boosted by the US presidential campaign, sporting events such as the Olympics and Uefa Men’s Euros, and improved trading conditions, particularly in China.