Local Media to See Strong 2010 Finish

After months of uncertainty, it looks as though providers in the local media space will see a positive ending to 2010. Earlier this year, BIA/​Kelsey had projected the local ad market would drop by nearly 1%. Now the company is looking for a 2.1% rise in this industry which would bring local ad revenue to $133.3 billion by the time all the numbers are in for the year.

BIA/​Kelsey analysts say that 2 specific segments are fueling much of the growth. These are:

  • Television: +13%
  • Online: +30.2%

This year, hard-​fought political contests at the local and state levels are driving TV revenue. Historically though, local media relies on several mainstays as revenue sources. These include automotive, educational, finance/​insurance, general services, government/​religion, health care, leisure/​recreation, media, real estate, restaurants, retail and technology. Revenues from these sources can comprise as much as 95% of local ad market spending.

And though the numbers will be positive this year,  Neal Polachek, president, BIA/​Kelsey, says, "Still, we don't expect to see meaningful recovery until 2012."

At the same time, providers of traditional media formats must remain aware of keen competition coming from new formats. Tom Buono, CEO, BIA/​Kelsey, remarks, "The strength and popularity of certain media over the next five years in the local media marketplace will dramatically affect the distribution of advertising spending for many of the advertising categories." Publishers of local newspapers and magazines find themselves competing harder for ad dollars that may increasingly be channeled to large players in the online market such as Google and Yahoo. And now that Facebook has entered the arena with its Facebook Places ‘service’, the  online ad market opportunity for local publishers may be challenged.

[Source: First Half of 2010 Stronger Than Anticipated for Local Media. www​.bia​.com. 14 Sept. 2010. Web. 21 Sept. 2010] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.