Last week, I discussed BIA/Kelsey’s new annual Local Media Forecast in the context of the outlook for radio stations. The firm's report also projects a strong outlook for the local media market every year between now and 2017. Not surprisingly, BIA/Kelsey's analysts point out that digital formats will be the growth stars of the local ad market over the next several years.
Currently, BIA/Kelsey believes we’ll end 2013 with spending of $132.9 billion in the local ad market. Of that amount, $106.4 billion will be spent purchasing traditional media and will account for 80% of local ad market activity. Digital formats will grab the rest, or about $26.5 billion of marketer outlay for local. By 2017, local ad market spending will jump to $151.5 billion. That same year, the traditional ad formats will account for $107 billion or 70.6%, while online formats will capture the remaining $44.5 billion.
Analysts posit that mobile will be one of the biggest drivers of local ad market spending, going from $2.9 billion this year to $10.8 billion in 2017. [Note that total ad mobile ad outlay will be something like $20.68 billion by then.] It's interesting to see how mobile spending will break out. For example, next year, total mobile ad spending should reach $10.15 billion, and, of that amount, $4.35 billion will be location-targeted by either local or national marketers. That level of spending will account for 43% of all mobile. By 2017, location-targeted mobile spending at the local level will likely exceed national spending.
BIA/Kelsey also rolled out projections for ad spending on a variety of formats by 2017. They believe the formats listed below will account for the following specific percentages of the local market:
- Newspapers Print: 9.1%
- Newspapers Online/Digital: 2.4%
- Yellow Pages Print: 1.5%
- Yellow Pages Digital/Online: 1.9%
- Radio O‑T-A: 10.6%
- Radio Online/Digital: 0.5%
- TV O‑T-A: 14.6%
- TV Online/Digital: 0.7%
These are valuable projections for anyone who sells local media and would likely determine the rate of shift from traditional to digital formats. What’s your opinion of these numbers? Do you think the move to digital will be worth more than what the BIA/Kelsey analysts are predicting by 2017?