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Local Ad Spend Growing Faster than Predicted Thanks to Digital

Ad Projections


 

November 19, 2013 – In the midyear update to its Annual U.S. Local Media Forecast (2012-2017), BIA/Kelsey projects total U.S. local media ad revenues to grow from $132.9 billion in 2013 to $151.5 billion in 2017, representing a 2.8% compound annual growth rate, growing faster than the firm originally forecast earlier this year.

Factors that BIA/Kelsey believe will drive local ad revenues higher in 2014 and through the end of the forecast period include: a slightly improving U.S. economy, positive outlook by investors, the 2014 elections and Olympics, and ad spending around the Affordable Health Care Act.

DIGITAL DRIVING FASTER GROWTH
 

Faster growth in online/digital ad revenues will drive that faster overall growth, increasing at a 13.8% CAGR from $26.5 billion in 2013 to $44.5 billion in 2017, the firm forecasts. That compares with a CAGR of 0.1% during the same period for traditional advertising revenues, which will remain flat, growing slightly from $106.4 billion in 2013 to $107 billion in 2017.

GEO-TARGETED MOBILE ADS TO ACCOUNT FOR 52% OF AD SPEND BY 2017
 

Location targeted mobile advertising revenues, which are growing at a faster pace than overall mobile advertising, will increase from $2.9 billion in 2013 to $10.8 billion in 2017, accounting for 52% of overall U.S. mobile ad spending in 2017. Total mobile ad spending will grow from $7 billion in 2013 to $20.7 billion in 2017.
 


Source: BIA/Kelsey, 2013


OFFLINE VERSUS ONLINE LOCAL MEDIA AD REVENUE


BIA/Kelsey’s local media forecast breaks out the share of ad revenues attributed to print , radio and TV versus online/digital for Yellow Pages, newspapers, television and radio.

The following represent individual media segment shares of the overall local media market by 2017 and how those shares have moved from their 2013 position:
 

 



Source: BIA/Kelsey, 2013

 

About: BIA/Kelsey defines the local media advertising marketplace as those media that provide local audiences to all types of advertisers. BIA/Kelsey’s Annual U.S. Local Media Forecast (2012-2017) draws from proprietary data; company, industry and country information in the public domain; and discussions with clients and non-clients about the direction and pace of development in the local media marketplace. The forecast is issued annually each spring and updated in the fall.

Source: BIA/Kelsey, BIA/Kelsey Forecasts Overall U.S. Local Media Ad Revenues to Reach $151.5B in 2017, Lifted by Faster Growth in Online/Digital, Nov. 19, 2013