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BizReport : Advertising archives : December 21, 2015

Forecast: Local ad revs to top $146b

Look for local advertising to steadily rise in 2016. That is the takeaway from BIA/Kelsey's 2016 US Local Advertising Forecast which predicts local revenues to increase from $141 billion this year to $146.6 billion in 2016. That's an increase of nearly 4%.

by Kristina Knight

The online portion of the local ad spend will increase at least $4 billion, growing from $38 billion in 2015 to $42.6 billion in 2016.

"For 2016, we expect total local ad revenues to nudge upward, resulting from a slightly stronger U.S. economy and a substantial amount of political advertising," said Mark Fratrik, chief economist, BIA/Kelsey. "We also adjusted our 2015 estimate for total local media spending up slightly due to stronger mobile and social advertising."

Further breaking down the spend, BIA/Kelsey's experts believe location-based ad spending will increase to just over $11 billion while local social spending will increase to at least $3 billion, and that mobile video will become a larger player in the ad space, increasing to nearly $1 billion in spending. Mobile, according to the experts, will be the driving force behind all local online ad revenues.

"Mobile spending is growing faster than expected, cutting into the growth of other online advertising," said Fratrik. "For example, online spending on ads viewed through desktops is still increasing, but overall only at single digit growth rates as more of the attention of consumers and advertisers alike shifts to mobile. Local video spending on all platforms--mobile, online, TV over-the-air, cable and out of home--will grow, along with local video's slice of the local advertising pie."

Image via Shutterstock

Tags: 2016 advertising trends, advertising, advertising forecast, BIA/Kelsey, local advertising

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