Digital advertising 'defied economic gravity' with €118.9bn growth

European digital advertising achieved an unprecedented milestone in 2024, surpassing €100 billion for the first time to reach €118.9 billion. The market demonstrated remarkable resilience with 16% year-over-year growth despite challenging economic conditions, according to IAB Europe's comprehensive AdEx Benchmark Report released on May 21, 2025.

The report represents the strongest growth since 2011, excluding the unique pandemic-driven surge of 2021 when digital advertising expanded by 30.5%.

The nineteen-year study now encompasses 30 European markets, including newcomer Portugal. According to Dr. Daniel Knapp, Chief Economist at IAB Europe, "this year marks a major milestone for the first time ever the European digital advertising market has surpassed the 100 billion mark reached an incredible 118.9 billion that's the strongest growth we've seen since 2011 excluding the unique post-pandemic surge in 2021".

Digital advertising now commands 67.2% of total advertising expenditure across Europe. The market demonstrated stability throughout 2024, with quarterly growth rates remaining consistent at 16.9%, 15.5%, 15.1%, and 16.5%. This stability contrasts sharply with the volatile patterns experienced during the COVID-19 pandemic.

Dr. Knapp explained the study's expanded scope: "we are covering 30 markets with a new addition this year Portugal". He noted that because the Portuguese Interactive Advertising Bureau could not submit data, IAB Europe created estimates for Portugal to complete coverage of Western European markets.

Video content has become the undisputed driver of European digital advertising expansion. Display video advertising achieved 24.5% growth, while social video surged by 32.8%. The combined video advertising ecosystem now represents €28.8 billion, demonstrating exceptional performance across multiple channels.

Video now exceeds 50% of display advertising spend in nine European markets. Ukraine leads with 63%, followed by Greece at 62% and Bulgaria at 61%. According to the presentation, "video now accounts for over 50% of display advertising in nine markets".

Connected television formats particularly drove this expansion. Subscription Video on Demand platforms recorded extraordinary growth of 222.4% as major streaming services including Netflix, Disney+, and Amazon Prime Video expanded their advertising capabilities across European markets. Broadcast Video on Demand services contributed with 29.5% growth.

Dr. Knapp noted during the presentation: "SVOD new entrance in the market social video extremely strong um the BOD numbers show that um local and national players have a key role to play in digital advertising".

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Retail media establishes €11.1 billion category

For the first time in the AdEx Benchmark Report's history, retail media appears as a dedicated category, reflecting its emergence from niche advertising tactic to substantial market segment. The European retail media market achieved €11.1 billion in 2024, representing 22.2% growth.

Retail search advertising expanded by 24.9% to reach €8.3 billion, now representing 16.2% of total search advertising across Europe. As Dr. Knapp explained during the webinar: "we've also seen a huge rise in in esport platforms Netflix uh Disney Plus Prime Video etc which contributed to a lot of growth in the in the digital video space".

The systematic addition of retail media represents a significant methodological enhancement. According to the presentation: "there have been a few changes this year in particular the systematic addition and the kind of harmless allocation of retail media ad spend it was there um sometimes in some parts of IBS for instance some part of Amazon spend was counted sometimes it was in search sometimes in display".

Major European retailers have invested substantially in building sophisticated advertising platforms. The retail media expansion divides into retail search and retail display advertising, with search demonstrating stronger growth momentum due to immediate purchase intent.

Geographic distribution reveals market concentration patterns

The European digital advertising market maintains pronounced geographic concentration. The three largest markets—United Kingdom, Germany, and France—account for 60% of total expenditure. As detailed in the presentation: "the market remains topheavy um the three largest countries in the study contribute about 60% to the market total the top 5% 70".

However, growth patterns reveal dynamic activity beyond traditional media centers. Twenty-one of the 30 markets achieved double-digit growth, with eight of the ten fastest-growing markets being outside the top ten largest markets.

Turkey topped growth rankings with 87.5% expansion, though currency devaluation effects significantly influence this figure. When examining constant currency terms, Ukraine led with 27.2% growth, followed by Serbia at 24.8% and Poland at 19.6%.

Dr. Knapp emphasized the methodological complexity of measuring growth across diverse economic conditions: "just to recap there were quite a few headwinds that have increased complexity of comparison you see in particular Turkey inflation you see exchange rates and you also see um um changing and deteriorating economic forecasts in Europe".

Social media advertising maintains strong momentum

Social media advertising achieved 23.9% growth across Europe, reaching €27.5 billion in total investment. The category divides into standard social advertising and social video advertising, with video content driving the majority of expansion.

Social video advertising expanded by 32.8%, while standard social advertising grew by 14.1%. According to the presentation findings: "social increased the share in particular driven by social video um we can also see that display increased its share mainly driven again by video".

Platform diversification has contributed to social media's robust performance. While Facebook and Instagram maintain dominant positions, TikTok's European expansion has created new advertising opportunities, particularly for brands targeting younger demographics.

Programmatic advertising demonstrates renewed vitality

After experiencing slower growth in 2023, programmatic advertising demonstrated renewed strength in 2024 with 18.4% expansion, reaching €15.5 billion across Europe. This recovery reflects technological and market developments that have enhanced programmatic advertising's value proposition.

According to Dr. Knapp: "we saw a slowdown in programmatic in 2022 to kind of singledigit growth we saw a reaceleration um and kind of more more than doubling of the growth in 2024".

However, programmatic growth patterns varied significantly across European markets. Poland, Hungary, and Slovenia demonstrated strong programmatic expansion, suggesting that less mature markets offer greater adoption opportunities.

Audio advertising crosses billion-euro threshold

Digital audio advertising achieved €1.05 billion in European spending during 2024, crossing the billion-euro milestone for the first time with 18.3% growth. The audio advertising market divides between podcast advertising and other digital audio formats.

As noted in the presentation: "audio continues to grow but from a small base um the nonpremium Abot market um is showing a significant gap towards Bbot".

Podcast advertising achieved 20.6% growth, reaching €451 million, while other audio formats grew 16.7% to €603 million. The correlation between digital audio advertising investment and traditional radio market strength demonstrates interesting complementary relationships.

Search advertising maintains category leadership

Search advertising achieved 12.4% growth, reaching €51.1 billion and maintaining its position as Europe's largest digital advertising category. Standard search advertising grew by 10.3% to €42.8 billion, while retail search advertising expanded by 24.9% to €8.3 billion.

This shift reflects fundamental changes in consumer search behavior, with European consumers increasingly beginning product searches on retail websites rather than general search engines. According to the findings: "search was driven by retail search retail search grew two more than 2x the rate of standard classical search and expanded its share of total search to 16.2%".

Economic outlook presents measured optimism

Looking toward 2025, market leaders anticipate a more challenging environment characterized by economic uncertainty and geopolitical tensions. Dr. Knapp provided a cautious assessment: "we expecting an overall more conservative outlook for digital advertising um you know um weak economic environment paired with the overall maturity of digital advertising they were expecting around a 6.5% uh forecast".

The expected shift toward performance-driven advertising strategies may benefit categories with strong measurement capabilities, including search advertising, retail media, and programmatic display advertising.

Why this matters

The 2024 AdEx Benchmark Report findings present several strategic implications for the marketing community. Video advertising's dominance across multiple categories indicates that brands must prioritize video content creation and multi-platform distribution strategies. The emergence of retail media as a €10+ billion category suggests that brand relationships with retail partners require strategic reconsideration.

The geographic growth patterns reveal opportunities for brands to explore expansion into high-growth smaller markets, while the continued expansion of programmatic advertising reinforces the importance of first-party data strategies and sophisticated audience development.

Dr. Knapp summarized the year's performance: "we did see an improve an improvement versus 2023 but we need to really acknowledge that a lot of that growth is to uh currency and consumer prices and I caution anyone to to celebrate these uh results um too easily".

Timeline

May 21, 2025: IAB Europe releases 2024 AdEx Benchmark Report at annual Interact conference in Brussels

• European digital advertising market reaches €118.9 billion milestone
• 16% year-over-year growth represents strongest expansion since 2011
• Video advertising and retail media emerge as primary growth drivers