BIA: Local Ads Will Rebound In '12, Political Ads Will Aid Trad Media

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Local advertising will see a rebound --- but not until 2012, according to a recent estimate.

Media forecaster BIA/Kelsey expects the local advertising market in 2010 to be just under $128.9 billion with virtually no change in 2011, which should reach $129.8 billion.

A meaningful recovery will not happen for another two years, with an increase of 3% to $134.1 billion in 2012. That same rate of growth will continue in 2013 ($138.4 billion) and 2014 ($144.9 billion).

Local advertising has had significant declines in the last two years -- thanks to a crushing recession -- going from $156.3 billion in 2008 to $130.2 billion in 2009, a drop of 17%.

"Even with the consensus that the recession is over, we do not anticipate a rapid recovery among traditional media over the forecast period (2009-2014), because we believe the structural change in the local media industry has accelerated," the report says.



BIA/Kelsey says there have been larger-than-expected declines in newspapers and direct mail, and a lower rate of growth in the digital businesses: search, mobile, display and classifieds.

Changing dynamics will continue to evolve around a shift from cost-per-thousand and subscription business models to areas of performance models for advertisers.

There is one silver lining. More political advertising, pushed by a recent U.S. Supreme Court decision, is freeing up corporate political spending and will aid traditional television, radio, digital and direct-mail businesses.

BIA/Kelsey notes that last year, 55% of U.S. $235.6 billion in ad spending came from local advertising platforms -- $130.2 billion in local advertising to $105.4 billion for national advertising.

The study notes a continued shift into local digital media -- climbing from $17.5 billion in 2010 (14% of all local advertising) -- to $21.0 billion in 2011 (16%), $25.6 billion in 2012 (19%), $30.7 billion in 2013 (22%), and $36.7 billion in 2014 (25%).

1 comment about "BIA: Local Ads Will Rebound In '12, Political Ads Will Aid Trad Media".
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  1. Mark Wellman from Webster Atlantic Corporation, February 23, 2010 at 11:10 a.m.

    As gloomy as this appears I believe we are in a constant state of change. This situation may improve after the elections this year.

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