By: Press Release | BIA/Kelsey
CHANTILLY, Va. (March 20, 2012) – In its newly released U.S. Local Media Forecast (2011-2016), BIA/Kelsey, adviser to companies in the local media industry, expects strong growth in the digital segment of local media advertising through 2016. According to the firm’s forecast, local online/interactive/digital advertising revenues will climb from $21.2 billion in 2011 to $38.5 billion by 2016, representing a compound annual growth rate (CAGR) of 12.7 percent (this figure includes mobile). The growth in the digital segment will offset slower than anticipated growth in total local media advertising revenues.
BIA/Kelsey analysts will present highlights from the forecast at next week’s Interactive Local Media East conference, March 26-28, in Boston. ILM East is the premier gathering of senior executives from across the local digital media, advertising and marketing space.
Local Advertising Feeling the Impact of Global Economic Factors
The U.S. economy remained slow through most of 2011, owing to a variety of factors including concerns about the European economic crisis, continued high unemployment and the housing market’s lack of recovery. These factors led to consumers and businesses “holding back” in their spending. The weaker than expected level of economic activity resulted in a lower level of local advertising revenues.
“In October, we projected the total of the U.S. local media market to be $135.9 billion in 2011,” said Mark Fratrik, vice president and chief economist, BIA/Kelsey. “But we now expect it to be $132.8 billion. Based on the changes in our estimates going forward, we expect the overall local media market will grow a bit more slowly over the next five years.”
BIA/Kelsey forecasts total local media ad revenues to grow from $132.8 billion in 2011 to $151.3 billion in 2016 (CAGR: 2.6 percent).
The firm expects traditional local media revenues to grow from $111.5 billion in 2011 to $112.7 billion in 2016 (CAGR: 0.2 percent). Predictably, traditional media revenues experience a bump during election years from political advertising, which appears as a drop in revenues in odd-numbered years. Despite the year-over-year political advertising seesaw effect, traditional media revenues remain remarkably steady throughout the forecast period.
About the Annual U.S. Local Media Forecast
BIA/Kelsey defines the local media advertising marketplace as those media that provide local audiences to all types of advertisers. BIA/Kelsey’s Annual U.S. Local Media Forecast (2011-2016) draws from proprietary data; company, industry and country information in the public domain; and discussions with clients and non-clients about the direction and pace of development in the local media marketplace. The forecast is available to clients of the firm’s Continuous Advisory Services. For information on BIA/Kelsey’s CAS offerings, contact Steve Passwaiter at firstname.lastname@example.org or visit http://www.biakelsey.com/Advisory-Services/.
About ILM East
This year’s Interactive Local Media East conference, which takes place March 26-28 in Boston, focuses on channels, commerce and conversion — the essential elements for succeeding in the local media and marketing space. The agenda will cover the latest developments in local online media, search, mobile, social, daily deals, video and transactions. Information about the conference, including featured speakers, agenda, sponsors and online registration, is available at www.biakelsey.com/ilmeast2012.
BIA/Kelsey advises companies in the local media space through consulting and valuation services, research, Continuous Advisory Services and conferences. Since 1983 BIA/Kelsey has been a resource to the media, mobile advertising, telecommunications, Yellow Pages and electronic directory markets, as well as to government agencies, law firms and investment companies looking to understand trends and revenue drivers. BIA/Kelsey’s annual conferences draw executives from across industries seeking expert guidance on how companies are finding innovative ways to grow. Additional information is available at www.biakelsey.com, on the company’s Local Media Watch blog and on Twitter at http://twitter.com/BIAKelsey.