Saturday, February 28, 2009

Forecast says local advertising will drop through 2013

A forecast by BIA and The Kelsey Group says that local advertising (much of it supported by trade promo funding of one sort or another) will decline sharply in all categories except online over the next five years.
Between 2008 and 2013, local ad spending will decline at a 1.4 percent compound annual rate to $144.4 billion. In contrast, the share of interactive ad spending will more than double from 9 percent in 2008 to 22.2 percent in 2013.
The question for many traditional media (especially newspapers) will be whether they can grab a significant portion of the online growth. In a great many markets, the newspaper web site is the leading local site, but newspapers have not grabbed as big a piece of online revenues as they would like.

If they don't get more of the online money, we'll probably see more papers, and maybe some broadcast outlets, joining the Rocky Mountain News.
Traditional media -- including newspapers, direct, broadcast, Yellow Pages, out of home, cable TV and magazines -- are forecast to decrease from $141.3 billion in 2008 to $112.4 billion in 2013.
I'm curious how much of the loss of revenue in local advertising is traceable to funding moving to in-store promotion.

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