• by Gavin O'Malley  @mp_gavin, September 7, 2012

Despite promises of boundless media measurements, online marketers still have trouble tracking consumer behavior by specific geography.
 
In effort to correct this blind spot, Borrell Associates has formed Digital Marketing Regions (DMRs), which identify 513 U.S. markets where local businesses concentrate digital ad expenditures.
 
“TV has its Designated Marketing Areas,” according to Kip Cassino, EVP at Borrell. “Radio has its Arbitron markets. The DMR is uniquely for digital marketing.”
 
While the average DMR includes six counties, and has $36 million in locally spent digital advertising, the median DMR has $10.6 million in online ad spending, according to Borrell.
 
Nationwide, they significantly range in size from Los Angeles -- with an estimated $813 million being spent by local businesses this year -- to Carlock, South Dakota, with a more modest $310,000.
 
In fact, in one-third of the DMRs, local businesses are spending less than $5 million, while each of the nation’s 3,033 counties falls within one of the regions.
 
By Borrell’s estimate, local U.S. businesses will spend $18.7 billion on digital advertising this year -- up 21% from 2011.
 
Looking ahead, it's projecting 30% growth in 2013, to $24.4 billion. If accurate, digital media will finally hold the greatest share of local ad budgets -- unseating the longtime leader: local newspapers.
 
Further, digital media will control 25% the $96 billion local advertising marketplace, while newspapers will control the second-highest share at 18.6%, Borrell predicts.
 
Borrell said it developed the DMRs with the help of its client base of more than 1,000 local media companies.
 
The regions were selected by a formula that identifies a core county where digital marketing expenditures to reach local consumers is high, then spans out to draw geographic boundaries where expenditures taper off or “hit a wall” from another market’s expenditures.