An important advertising channel loses its importance

Will advertising in search engines be as relevant for companies in the next five years as it is today? According to the latest trend monitor from the German Digital Economy Association, not: The importance of search advertising is decreasing by almost a quarter, from 100 percent to 77 percent. The basis for the trend overview in digital marketing is a non-representative survey of industry participants from digital marketing.

Volume of paid social measures grows significantly

The loss of importance of search is not reflected in the expected volume: this is expected to grow by three percent from 2024 to 2025. This means that investments are expected to grow in this area. The largest increase, ten percent, in volume is expected for paid social measures, including ads on social media platforms. In contrast to standard displays, the biggest losers are banners: around three percent less will be invested in them in 2025 than in 2024.

According to the experts surveyed, advertisers will adjust their budgets. Growth is expected in the retail media sector, for example. The new form of advertising describes placing ads with retailers such as Amazon, Kaufland or Obi. Advertisers use the companies’ existing online and offline structures as well as their first-party data.

Retail media as a driving force and the biggest challenge for digital marketing

Last year, retail media was already considered a growth market. In the new trend monitor, the advertising format is described as a “driving force” that will become increasingly important. However, it is also clear that the initial hype is over. Criticism has been leveled at the lack of standards in the retail media sector, as well as a lack of transparency and evidence of effectiveness. With these weaknesses, retail media is not only a great opportunity, but also a great challenge.

Video remains a hyped topic: it is the only form of advertising that retains 100 percent approval. The upper funnel in particular, the area in which consumers become aware of companies, is dominated by it.

Growing advertising market with “excessive” demand

Overall, respondents expect the advertising market to continue to grow – but at the same time they see the demand for digital advertising as excessive. Only a little more than half think that demand is appropriate in relation to the reality of media usage.

More than 50 participants were surveyed for the Trendmoitor. They each received a core questionnaire and were also divided into six expert groups: Future Signals, Human Resources, Investment, Market Development, Retail Media and Video. According to the BVDW, the participants should represent “over 90 percent of the digital agency media volume in Germany”.

What agencies expected in 2024, said Smarketer CEO David Gabriel in this episode of t3n Interview:

Well-known marketing companies such as Groupm, Omnicom Media Group and Publics are involved. However, the qualitative survey is not representative: the majority of German marketing companies are micro-enterprises, and there are more than 20,000 companies in the sector. The trend monitor therefore only provides an impulse on the current situation and shows how the market-dominating companies currently assess the field.