It is estimated that global advertising investment will grow by 11.9% this year, reaching $1.34 trillion, according to Warc forecasts. However, an analysis by the consulting firm indicates that the world’s most important brands, with the exception of consumer goods companies, allocate, on average, an increasingly smaller part of their sales income to advertising.

That is one of the main conclusions of the report “Global Ad Trends: The Cost of Being Seen”, in which Warc has analyzed the evolution of the advertising investment of 25 large American advertisers – the largest advertisers internationally – between 2019 and 2025. Specifically, it has focused on the ad-to-sales ratio, which measures what a company invests in advertising in relation to its income.

According to the research, advertising intensity has decreased, that is, the proportion of income that these companies jointly allocate to advertising has decreased from 6.1% to 5.5% in the six-year period indicated. However, the consulting firm points out that this does not mean that they are investing less in absolute terms, since their aggregate advertising spending has increased by 56% during that period; although the budgets have not grown at the same rate as their income, which experienced an increase of 73%.

“We are faced with a market that advances at two speeds. Increased spending on digital platforms by smaller businesses and cross-border e-commerce sellers is far outpacing ad spend growth by big brands“explained Alex Brownsell, Head of Content at Warc, in a statement. “This situation has important implications for the ecosystem of agencies and suppliers operating in the business market.”.

As the consulting firm indicates, some of the large technology companies are the ones that contribute the most to the reduction of advertising intensity. Between 2019 and 2025, the combined proportion of revenue allocated to advertising by Alphabet, Meta, Microsoft and Netflix rose from 13% to 7.4%. On the other hand, its turnover grew by 146%, from 379,000 to 931,000 million dollars.

The report estimates that, if these four companies had maintained the same relationship between advertising investment and revenue that they had in 2019, they would have allocated $121 billion to advertising in 2025, about $52 billion more than they actually invested.

Consumer goods brands show the opposite trend. Five of the six advertisers analyzed by Warc – Coca-Cola, Estée Lauder, L’Oréal, Nike, PepsiCo and Procter&Gamble – increased their ratio of advertising investment to sales between 2019 and 2025. As explained in the report, the moderation in sales growth caused the sector’s ad-to-sales ratio to go from 11.6% in 2023 to 12.5% in 2025. Overall, advertising investment grew by 36% during the six years analyzed, a figure that is above the 29% increase recorded in its income.

Beyond big technology and consumer companies, behavior is less homogeneous. Among the other 15 advertisers examined, 10 individually reduced their advertising intensity between 2019 and 2025, although the group average, weighted by revenue, remained stable or increased slightly.
For example, Ford’s ad-to-sales ratio fell from 2.3% to 1.6%; while Mastercard’s went from 5.6% to 4.0%. On the contrary, Walmart, Starbucks and Expedia were the three companies in this group that increased their advertising intensity.

The forces behind advertising intensity

As Warc explains, there are three main forces that are causing variations in advertising intensity. On the one hand, the evolution of sales, and brands that maintain their advertising investment in adverse market conditions, even if their sales decrease, may experience an increase in advertising intensity.

On the other hand, changes in budget allocation. According to Warc, part of the resources that were previously allocated to sales teams, in the form of investments at the point of sale or actions aimed at the consumer, are being transferred to retail media and, therefore, to the advertising budget item.

And finally, the difference between owning attention and renting it. Companies like Alphabet and Meta have platforms, services and ecosystems that maintain a direct relationship with millions of users, which can reduce their relative dependence on purchasing advertising space to sustain growth.
This circumstance does not imply that technology companies have stopped needing advertising, but it does help explain why their income can grow considerably without media investment increasing in the same proportion.