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Local Web Ad Growth Slows Considerably

Growth in the local-ad market, which represents about a third of total U.S. online spending, is expected to shrink this year, as local businesses chop their ad budgets thanks to the recession. This is bad news for sellers, consultant Greg Sterling says, especially those that offer ad products that are very similar.

According to Borrell Associates, local online spending in the U.S. is expected to grow just 5.4% in 2009 after growing a whopping 45% last year to $12.7 billion. Meanwhile, total U.S. online ad spending is expected to be flat, declining 0.3% to $36.9 billion in 2009, compared with growth of 8.5% in 2008, the media researcher says.

In spite of the weak forecast, The Wall Street Journal reports companies are still trying to strike gold in the local online ad market. Calif.-based ReachLocal this week unveiled a new targeting system to help local advertisers show ads only to those consumers who previously visited the advertisers' Web site or live in a certain area. Earlier this month, Seattle-based Marchex, a search advertising company, expanded its offerings to include mobile Web sites and click-to-call search ads.

Read the whole story at The Wall Street Journal »

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