BIA/Kelsey Sees 2.2% Rise in Local Ad Market by 2014

RADIO ONLINE | , , | :am CT

BIA/Kelsey estimates the U.S. local advertising market to reach $144.9 billion in 2014, representing only a 2.2% growth rate from 2009. Local media spending, which the firm reveals is 55% of all spending, is expected to be slow through 2011, with meaningful recovery beginning in 2012. This according to its U.S. Local Media Annual Forecast (2009-2014).

In 2009, total U.S. ad spending was $235.6 billion (based on BIA/Kelsey's estimates). Of that it estimates $130.2 billion was spent on local ad buys, with $105.4 billion attributed to national advertising.

As a steady shift toward digital media continues, BIA/Kelsey forecasts spending on traditional media to decline from $115 billion in 2009 to $108.2 billion in 2014 (CAGR of -1.2%). During the same period, spending on online/interactive media is projected to grow from $15.2 billion to $36.7 billion (CAGR of 19.3%).

BIA/Kelsey reports among the key drivers of this year's forecast are:

• Larger than previously forecast declines in newspapers and direct mail.
• Slowing growth of the interactive/online sector, including search, display and classifieds.
• A further ramp-up in political advertising, due to the recent U.S. Supreme Court decision, which will benefit the traditional television and radio sectors, as well as the interactive and direct mail sectors.

"Even with improvements in the overall economy, we do not anticipate a rapid recovery among traditional media over the forecast period, because we believe the structural change in the local media industry has accelerated," said BIA/Kelsey President Neal Polachek.