Commentary

'Extraordinary' Mobile Growth Driving Local Ad Spending

Thanks in part to “extraordinary” mobile growth, local ad spending is looking strong, heading into 2017. Next year, in fact, total local ad revenues will increase by 2.4% to $148.8 billion, according to the latest forecast from BIA/Kelsey.

To be fair, a range of factors are driving the growth, according to Mark Fratrik, SVP and chief economist at BIA/Kelsey.

Those factors include, “an improving U.S. economy, increased spending by national brands in local media channels, extraordinary growth in mobile and social advertising, and the continued expansion and selection of online [and] digital advertising platforms,” Fratrik notes in the report.

Make no mistake, however, faster growth in online and digital advertising revenues -- including mobile -- is a major component of the projected increases in the overall local advertising pie, according to Fratrik. 

From 2016 to 2017, BIA/Kelsey expects online and digital to increase by 13.5% to $50.2 billion.

That compares with a decrease of 2.4%, next year, for “traditional” ad revenue (print and over-the-air) -- set to going from $101.1 billion in 2016 to $98.6 billion in 2017.

Across all local ad spending, the research firm is then predicting that online and digital will exceed print media by 2018.

Also of note, as more search activity takes place on mobile devices, mobile is cannibalizing search dollars from desktop, according to the research firm.

Ultimately, however, the local search dollars still go to the same giant players (Google and Bing), which already have footholds in both channels.

BIA/Kelsey defines local advertising as all advertising platforms that provide access to local audiences for national, regional and local marketers.

Ultimately, however, the local search dollars still go to the same giant players (Google and Bing), which already have footholds in both channels.

BIA/Kelsey defines local advertising as all advertising platforms that provide access to local audiences for national, regional and local marketers.

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