Report: Local Digital Ad Spending Tops $100 Billion

RADIO ONLINE | Thursday, May 15, 2025 | 3:20pm CT

Borrell Associates

Local digital advertising surged past the $100 billion mark in 2024, now accounting for roughly 70% of all local ad spending, according to Borrell Associates' 2025 Annual Report. The landmark report underscores the dramatic shift from print and traditional broadcast media to digital formats, marking a complete reversal from the media hierarchy of the 1990s.

Digital advertising is projected to grow another 3.9% in 2025 and maintain an annual growth rate near 4% through 2028. Key growth drivers include search, display banners, and streaming/connected TV (CTV), which Borrell says will account for 78% of digital and 57% of total local advertising within three years.

Despite the dominance of tech giants like Google and Meta-who continue to reinvest heavily in research and development-local media companies have clawed back some ground. For the fourth consecutive year, they grew their share of local digital ad revenue, capturing 14.9% in 2024 by leveraging in-market relationships and bundling services that national platforms can't replicate.

Digital now represents a critical revenue stream for legacy media outlets. For many newspapers, it comprises more than half of total ad revenue, and for local TV stations, it is an increasingly important-though still smaller-contributor. Notably, successful operations are deriving as much as two-thirds of digital revenue from off-site services such as banner ads, streaming video, and resold search.

However, the report reveals a significant gap between top performers and the rest. While total digital revenue for local media hit $15.3 billion in 2024, a staggering 85% of nearly 2,600 media companies surveyed captured less than 10% of the obtainable digital revenue in their markets. Only 3.5% were considered "best practice" operations, defined by capturing a 25% share or more.

Market performance remains uneven, with some areas poised for double-digit digital growth in 2025 and others facing contraction. On average, local media companies earn about 50% of their digital revenue from banner and sponsorship ads, 25% from streaming/OTT, and 20% from fee-based services-highlighting the evolving nature of digital monetization.

Borrell also points to a dramatic post-pandemic shift in the local advertising landscape. U.S. business formation reached five million applications annually, swelling the small business base by 4.7% in 2024 alone. These new advertisers are often led by entry-level marketers who, surprisingly, are more open to traditional media. Since 2020, newer businesses have been twice as likely as established firms to increase spending on newspapers, radio, and TV.

Survey data also suggest that traditional media's perceived effectiveness is on the rise, even as confidence in media reps' marketing expertise and digital acumen declines.

Daily newspapers were the only sector where average digital revenue has not grown since 2020, according to the report. For local media companies still lagging in digital transformation, Borrell's findings suggest both an urgent wake-up call and a roadmap for change.

Borrell will hold a webinar on Thursday, May 29, 11am-noon ET to discuss the report. Register for webinar & free report here.