Crazy as it may sound, the advertising marketplace is keeping its cool for the most part in the face of a series of events that historically would have set it off in a tizzy of halted budgets and downward forecasts: a new war, rising oil and gas prices, the return of tariffs and generally slumping consumer confidence.
Basically, market and economic uncertainty are simply the new normal, according to a canvassing of holding company and independent media agency executives and consultants. Budgets are largely staying put — for now — thanks not only to this being just the latest potential economic crisis to land on the shoulders of the global economy but also to the fact that media sellers offer so much more flexibility today that instant pullback is just no longer necessary. (We all get used to things, no matter how negative they can be, if they happen to us often enough.)
“It’s crazy, but I feel like we are at a point where we’re all sort of immune to the craziness,” said one holding company head of investment, who spoke on condition of anonymity. “We’re not hearing of anything major, in terms of clients that are pausing or pulling back because of what’s happening in the world … Sadly, I think it’s just we’re immune.”
What feels different this time is how level-headed clients are acting, mainly because they’ve danced with economic volatility enough times to know the steps. “I’ve had some conversations with clients, and they say, ‘We’ll deal with it when there’s something to deal with.’ Scenario planning is now part of life. We’re all dealing with a heightened state of cortisol levels, which is sad.”
“Politics aside, going back to Trump 1.0, through that administration, the following administration, and this one, there’s been a tremendous amount of uncertainty,” said Scott Shamberg, CEO of independent media agency Mile Marker. “Because of the administration, because of Covid or because of other global macro factors. And I think uncertainty is the new norm, and that’s why I think you won’t see tremendous pullback [in the ad marketplace]. I think you’ll see value buyers — clients that we’ve got on the performance side — are trying to lean in a bit more. You have to be OK with some level of uncertainty. And I think brands are.”
That’s not to say some categories of advertisers won’t be ready to pull back should market conditions continue to worsen as the war with Iran and general Middle East chaos ensues. Some consumer packaged goods, financial services and direct-to-consumer advertisers may pull back, while travel-related advertisers may either heavy up on performance-driven channels to make up for any drop-off in bookings.
Within the travel and leisure world, some firms will notch up a direct impact on costs. Share prices among cruise line operators — among whom are some big-spending advertisers like Carnival and Royal Caribbean — slipped last week as markets responded to spiking oil prices. Airlines, similarly, could be hit with fuel accounting for an enormous chunk of their cost base.
Then there’s the impact on supply chains that could end up affecting advertisers down the line.
Mark Neale, founder and CEO of U.K. outdoor apparel retailer Mountain Warehouse, told the BBC that higher shipping costs could begin to hit businesses. “We’re starting to see some early signs of price increases on freight,” he said, adding: “Ultimately it will lead to cost increases if it continues.”
“There has been market uncertainty from an ad spend perspective going back to when tariffs were originally implemented [in 2025], and I think now, with what’s going on in the Middle East, I think there is more uncertainty,” said Shamberg.
Few CMOs or corporate bosses will discuss the war’s impact explicitly. They prefer euphemisms such as “dynamic geopolitical and macroeconomic environment,” to quote Dick’s Sporting Goods CFO Navdeep Gupta, who spoke on the retailer’s latest earnings call last week. That doesn’t mean they’re not keeping a wary eye on the indirect effects. According to analysis by Morgan Stanley, a 10% rise in oil prices could increase consumer inflation by 0.35% over the next three months; higher household energy costs could, in turn, depress consumer spending over a longer period.
But as of today, that’s not happened yet. “It’s not like a roller coaster, necessarily. I think that there’s a little bit more of a measured response, but that doesn’t mean that it’s not going to have an impact,” said a head of investment at another holding company. “I think people are just not making kind of knee jerk decisions or knee jerk reactions.”
Consultants who are in touch with marketers and brands every day are generally hearing the same thing. “Surprisingly, it seems like things are still full steam ahead,” explained Steve Boehler, who runs consultancy Mercer Island Group. “We encourage clients to have marketing, sales and ops monitor demand daily/weekly versus expectations and forecast and have predetermined pullback plans if needed. But our clients are not pulling back right now, probably because consumers continue to spend. And most firms are not assuming the Iran war lasts very long. All of this could change in an instant, of course.”
And everyone in the ad marketplace knows that. Although no one wants it to happen, a sudden increase in military deaths related to the war, or an inability to safeguard shipping traffic through the Strait of Hormuz could usher in a drop in consumer confidence along with a spike in consumer prices of everything from gasoline to other household goods.
“Consumer spend was projected to be up, anticipating fed rate [adjustments], and ad spend was projected to be slightly up. We’ll see what the next forecast looks like,” said Shamberg. “But I think the uncertainty continues, and I think there’s a definitive feeling of, let me crawl a little bit instead of walking, or let me walk a little bit instead of sprinting.”
So what does all this uncertainty signal for the fast-approaching upfront marketplace (which to Digiday’s thinking includes the NewFronts)? Tom Denford, CEO of consultancy ID Comms, addressed the upfronts in his weekly MediaSnack presentation on LinkedIn last Friday. In short, flexibility will win the day, which translates to scatter markets winning over long-term commitments.
“With economic visibility dropping, marketers will likely balk at locking in massive, long-term, inflexible commitments. Expect a heavy shift toward the scatter market and more liquid, flexible formats,” said Denford, who predicted there could also be a side effect that may inhibit marketers from thinking about changing agencies at this point. “We anticipate this uncertainty will dampen the appetite for massive, disruptive agency pitches in the first half of the year. Some brands will likely play it conservative, delaying major agency reviews and holding back investment heavily for H2 once the economic picture clears.”
Color by numbers
One of the industry’s closely ad spend projections, published by consultancy Madison & Wall, was revised upwards last week. To be clear, the revision was made before the conflict in Iran and the Middle East broke out.
- 10.2%: the total growth in U.S. ad spend expected by Madison & Wall, up from 8.9% projected in the consultancy’s year-end forecast.
- 8.1%: U.S. ad spend growth excluding political spend — the midterms are due later this year.
- 6.6%: The amount of U.S. ad spend growth (without political investments) previously expected by M&W.
Takeoff & landing
- Omnicom chalked up two early wins following its investors’ day last week, in keeping hold of the $500 million Dyson global media account, and its brief with Delta Air Lines. IPG Mediabrands (now, of course, part of Omnicom) had held the account since 2021, but had to fend off proposals from WPP and Publicis Groupe.
- Stagwell issued its 2025 earnings and 2026 forecast, ending up the year up 6% in net revenue growth, with a 17% margin, and $476 million in new business. Projections for 2026 include 8-12% expected net revenue growth and a rise in EBITDA from $475 million in 2025 to $525 million.
- Serviceplan Group, which owns the Mediaplus media agency network, opened a Singapore office in a joint venture with Singapore-based independent media agency The Media Shop, which will still operate independently in the region.
- Personnel moves: WPP Media replaced its CEO Rupert Petrie last week with Tina Chen, who comes over from an svp position at Shiseido in China … Dentsu raided Omnicom’s executive roster last week by hiring Chrissie Hanson as global brand president of Carat and North America media practice CEO. She was previously U.S. CEO of OMD USA and has been replaced by former MRM boss Bradley Rogers … Publicis Media named Hannah March its managing director of growth in the U.K., coming over from creative agency Fold7 … Independent Mile Marker hired Lauren Fraser as svp of strategy & transformation, a newly created role. She comes from GoodRX, where she was vp and gm.
Direct quote
“If you’re a brand leader, your marketing budgets continue to grow, but your investments in marketing are more disconnected than ever before. You’re under pressure to deliver business outcomes in an environment where commerce, data and tech are deeply interconnected, but platforms and closed systems are not. And this changes the value equation, because your brands need performance across all platforms optimized together.”
—Omnicom COO Daryl Simm, in comments delivered during the holdco’s investors’ day.