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WARC has reported that the world's biggest brands are spending a smaller share of sales revenue on advertising. Its analysis of 25 major US-listed advertisers found the decline was led by large technology groups.
Across the companies reviewed, the combined ad-to-sales ratio fell from 6.1% in 2019 to 5.5% in 2025, according to WARC Media. Combined advertising spend still rose 56% over the period, but that lagged revenue growth of 73%.
The broad pattern does not point to a pullback in advertising budgets in absolute terms. Instead, it suggests revenues at many large groups have grown faster than ad spending, reducing the proportion of sales reinvested in promotion.
Tech effect
The sharpest shift came from major technology companies. Alphabet, Meta, Microsoft and Netflix cut their combined ad-to-sales ratio from 13.0% in 2019 to 7.4% in 2025, while combined revenue climbed 146% from USD $379 billion to USD $931 billion.
WARC estimated that, had those four companies maintained their 2019 ratio, they would have spent USD $121 billion on advertising in 2025, or USD $52 billion more than they actually did. The figures show how some digital platform groups can expand without increasing paid media spending in line with sales.
The report said this helps explain an apparent contradiction in the global market. Overall advertising expenditure continues to grow, with WARC forecasting global ad spend to rise 11.9% this year to USD $1.34 trillion, yet some of the largest brand owners are becoming less advertising-intensive by this measure.
Adjusted for inflation, global ad spend has increased 61.3% over the past 25 years, driven partly by newer channels including retail media and platform advertising. Even so, the study indicates much of that market growth is not coming from big brands raising budgets at the same pace as turnover.
Consumer outlier
Consumer goods groups moved in the opposite direction. WARC's sample of six large companies in the sector - Coca-Cola, Estée Lauder, L'Oréal, Nike, PepsiCo and Procter & Gamble - showed five raising their ad-to-sales ratios between 2019 and 2025, while PepsiCo remained broadly flat.
From 2019 to 2025, the group's collective ad spend rose 36%, ahead of revenue growth of 29%. Their combined ad-to-sales ratio increased from 11.6% in 2023 to 12.5% in 2025.
WARC linked that trend to weaker sales growth and a shift in some budgets from trade and shopper marketing into measured media such as retail media networks. That accounting and channel shift can raise the share of spending recorded as advertising even if overall commercial investment is not rising as sharply.
"The global ad market is expanding rapidly, but companies from Meta to Mastercard and McDonald's are allocating a diminishing share of revenue to advertising. Only consumer goods companies - buffeted by softening sales growth and with trade budgets moving into measured media - are increasing ad intensity," said Alex Brownsell, Head of Content, WARC Media.
"This underlines what we've previously reported: we are operating in a two-speed marketplace. The expansion of digital platform spend by smaller businesses and cross-border eCommerce sellers is far outpacing growth in ad investment by big brands. This has major implications for the ecosystem of agencies and vendors operating in the enterprise market."
Mixed picture
Outside technology and consumer goods, the remaining 15 companies showed a less uniform trend. Weighted by revenue, their average ad-to-sales ratio was flat to slightly higher, but 10 of the 15 cut their ratios over the period.
Among carmakers, Ford fell from 2.3% to 1.6% and General Motors from 2.7% to 1.7%. In payments, Visa declined from 4.8% to 4.2% and Mastercard from 5.6% to 4.0%.
Restaurant and retail groups also declined, including McDonald's (1.7% to 1.3%) and Target (2.0% to 1.4%). Marriott, Booking Holdings, Eli Lilly and The Home Depot were also listed as showing lower ratios. Amazon and Yum! Brands were broadly unchanged, while Walmart, Starbucks and Expedia recorded increases.
WARC identified three drivers of changes in ad intensity: weak sales, shifts in budget lines, and the distinction between companies that own customer attention and those that need to buy it through advertising. The report said brands can increase ad intensity during periods of soft sales if spending holds up while revenue falls, while companies with large owned audiences may be able to grow without increasing paid media as much.
The findings were based on annual filings for 25 large US-listed companies, using reported revenues and advertising costs to calculate ad-to-sales ratios, with supplementary category data used where reporting practices differed.