Local advertising dollars are growing, but the businesses spending them—and the products they’re buying—are changing faster than many media companies’ sales strategies. For publishers building their 2027 budgets, Borrell Associates' CEO Gordon Borrell’s message is direct: Growth will require finding a different customer and bringing more to the sales call than another advertising package.
A growing market with different customers
Borrell Associates, a research and consulting firm specializing in local advertising and marketing expenditures, projects total U.S. local advertising spending of $155.6 billion in 2027, up 3.9% from 2026. Its revised forecast puts local digital advertising growth at 6.7% next year, with digital accounting for 75% of local advertising spending by year’s end.
Those numbers describe a market with opportunity. They also expose the distance between where advertisers are putting their money and where many media sales teams are still looking.
Your next advertiser may be missing from your prospect list
Borrell calls the underlying shift a “great reshuffling” of American businesses. Retailers that historically supported newspapers and broadcasters are giving way to a larger population of service businesses. Meanwhile, the average business is getting smaller.
According to the company’s research, the United States added approximately 1.6 million business establishments between 2020 and 2025, even as an estimated 5.8 million establishments closed. Average private business employment fell from 12.7 employees in 2019 to 11.3 in 2025.
For sales managers, the implication is practical: Familiar prospect lists may no longer reflect the local market.
Borrell said sales teams relying on what they see and hear in competing media can end up concentrating on only 5% to 7% of marketplace advertising expenditures. Much of the activity they miss happens through targeted digital advertising that a salesperson may never personally encounter. “You’re missing the other 93%,” he said.
Video takes the lead
The second major shift is video. Borrell said the strength of online video advertising surprised even his research team, prompting it to revisit earlier estimates. “Streaming video is now the number one expenditure of advertisers, beating out paid search,” he said.
The company’s definition includes connected television, streaming services, YouTube and video advertising on social platforms. Its forecast puts spending in that category at $30.8 billion in 2027, with growth of 10%.
For publishers, that creates an opening to help businesses that could not previously afford local television advertising use video. Capturing that business requires making the product accessible and connecting it to the advertiser’s objectives.
Meanwhile, Borrell sees little reason to expect a recovery in traditional newspaper advertising. He described annual print advertising declines of 10% to 15% for the foreseeable future and cautioned that publishers’ digital businesses can struggle when they remain too tightly attached to print.
He pointed to radio companies, including iHeart and Townsquare, as businesses publishers should examine for lessons in building digital revenue and pursuing overall growth.
Advertisers want advice they can trust
The interview’s most actionable advice, however, concerned what happens across the table from a business owner.
Borrell said his company used AI to analyze nine years of advertiser research involving tens of thousands of responses. The recurring message was confusion: Advertisers struggle with their media mix, appropriate spending levels and credible measurement of results.
They want help from someone they trust.
Borrell criticized needs assessments that inevitably produce a recommendation for whatever the salesperson already sells. He invoked Miracle on 34th Street, in which Santa recommends another retailer, to illustrate the value of advice that puts the customer first.
That need for guidance persists even as marketing tools become more accessible. Borrell said roughly half of small and midsize businesses remain marketing novices, with progress in their sophistication having stalled.
AI search creates a new service opportunity
AI-driven search adds another source of uncertainty—and another potential service opportunity. Borrell said 84% of advertisers reported fearing a loss of visibility, while 64% planned to increase budgets for search optimization and related efforts to remain discoverable through AI platforms. “This is not shifting SEO money. This is increasing budget,” he said.
Local publishers bring useful advantages to that work: recognizable brands, community relationships and original content. But Borrell cautioned that those assets require a broader business purpose centered on helping local companies grow.
He described work with the Local Media Association exploring what a successful media company could look like in 2030, with services, data and business support playing central roles.
Borrell will present the new local advertising forecasts and research findings in a free webinar on Nov. 11 at 11 a.m. EST.
Bring better information to the sales call
He also discussed Borrell.ai, which lets salespeople query local advertising intelligence, explore spending by business category and prepare estimates of a prospect’s budget and media mix before a meeting.
The point is to arrive with something useful: information that helps a business owner make a better decision and gives the salesperson a substantive place to begin.
For publishers preparing next year’s plans, that is a concrete assignment—broaden the prospect list, understand where spending is moving and earn the right to advise the customer.
“The whole damn landscape has become confusing,” Borrell said.
|
|
|
Comments
No comments on this item Please log in to comment by clicking here