Looking at 2025: Toto I’ve a feeling we’re not in Gansu anymore

As we close the books on 2024, one thing is crystal clear: the global marketing landscape has transformed so dramatically that it feels like we’ve entered the mystical realm of Oz.

The upcoming U.S. presidential transition adds an unpredictable element to global trade dynamics. Like a tornado that could change direction at any moment, potential policy shifts could reshape the marketing landscape, particularly in Asia. China’s projected 4.5% GDP growth might face headwinds, while markets like Vietnam, India, and Mexico might find silver linings in trade diversification.

2024: The Year That Kept Us Guessing

2024 felt like being stuck in the eye of a storm – deceptively calm, but with turbulence all around. The Asian marketing industry weathered significant headwinds, with client budgets squeezed tighter than Dorothy squeezing Toto. Pitches took a long time to get decided, or in some cases put on indefinite hold. While Q4 showed signs of life, it was more of a gentle breeze than the gust of recovery we’d hoped for. The outlook for 2025 is not going to be significantly different. While Trump may end the Ukraine war and ease tensions with China and Russia, his tariffs will create uncertainty that could dampen business investment and overall economic growth.

The Hong Kong economy was pinched, with locals increasingly crossing the border for better value in Shenzhen and Guangzhou. The property market’s descent left consumers feeling as deflated as their wallets, creating a psychological spending barrier that no amount of marketing magic could easily overcome. These structural challenges require long-term strategic shifts instead of short-term remedies. Is the HK SAR government up to it? Let’s hope they can deliver real magic like Elphaba, instead of going through the motions like the Wizard.

Perhaps because of economic pressure, the marketing C-suite underwent its own metamorphosis in 2024. CMOs and CCOs found themselves pivoting from brand guardians to growth architects. According to the Ruder Finn and PRovoke’s Communications Index 2024, business development and lead generation muscled their way up the priority ladder, while ESG initiatives took a backseat – a shift as dramatic as a change in wind direction.

The AI Scarecrow is No Longer Seeking a Brain

In our Communications Index 2023, we found that only 30% of communications leaders were familiar with generative AI, but in our 2024 report that number jumped to 69% who claim to be extremely or very familiar with it. Regular AI usage has also jumped to 51%, a significant increase from less than 28% last year. Initial distrust and indifference have given way to a spectrum of application that varies from cautious experimentation to mainstream deployment.

Ruder Finn was pleased to have Zack Kass, a highly regarded AI futurist, join our global AI council, and we’ve been hard at work improving AI fluency within the agency, infusing AI throughout our operations, and creating products that solve business problems for our clients in new and interesting ways.

For example, the rise of AI agents, which can process multimodal information and assist in managing complex workflows, is expected to transform marketing operations. These agents will act as “Chief Simplifier Officers,” helping clients and their brands harness massive performance data to enhance customer interactions.

Data at the Heart of Content

We will continue to see video, especially short-form video content, take the lion’s share of social media engagement. Shoppable video content will become a critical component of marketing strategies, with clients demanding more engaging video content that allows consumers to purchase directly from videos, enhancing the shopping experience.

The erosion of trust in mainstream corporate media is reflected by a surge in alternative news sources such as podcasts and social media platforms like X. Influencer marketing will remain significant, but the days of solely relying on follower numbers is gone. These days clients demand that creators prove they can drive conversions, relying on past performance data as measures of desirability for collaboration. We are also seeing clients move from flat fees to commission-based pay based on clickthrough and conversion.

Facing the Future with Courage

A challenging economic environnent, and business consultancies like McKinsey, Bain and Accenture Song muscling into the space, meant that the marketing landscape saw more consolidation, with major mergers like BCW and Hill & Knowlton forming Burson, and Omnicom and IPG joining forces. The holding companies continue to struggle to compete against consultancies, while even the independents are laying off, with Edelman announcing a 5.3% reduction of its total workforce, corresponding with an expected decrease in revenue in 2024 of around 8% in the U.S. and 3% globally.

While in-housing is a trend that threatens agencies, you could argue that the greater threat is the integration of previously silo-ized operational units at clients. This shift requires a holistic approach to problem-solving that is done best by business consultancies today, but watch this space as marketing consultancies staff up and catch up.

2025 will finally see digital marketing shed its “emerging” status and fully embrace its role as the backbone of marketing strategy. Some businesses will continue to struggle with digital maturity, with many planning to invest in improving their capabilities in 2025. Consultancies and in-house marketers that can create and direct a structured approach to digital marketing will be the winners.

Twists and Turns in the Road

As we look toward 2025, the marketing industry seems poised between transformation and uncertainty. The only constant will be change, and success will depend on our ability to adapt and innovate. While we may not be in Kansas (Gansu) anymore, perhaps that’s not such a bad thing – after all, some of the best opportunities arise when we’re forced to explore new territories. The incoming US president may be a tornado of unpredictability, but that could be a blessing in disguise.

Just remember to keep your ruby slippers handy – in this industry, you never know when you’ll need to click your heels and pivot to the next big thing.