Local Online Ad Revenues to Hit $42.5 Billion

Linc Wonham
by Linc Wonham 21 Mar, 2011

The rise of social media, mobile commerce and the daily deals platform are driving significant growth in online local advertising, reports BIA/Kelsey's U.S. Local Media Annual Forecast.


Online ad revenues are estimated to reach $42.5 billion by 2015, nearly twice the $21.7 billion reported in 2010. That increase represents a compound annual growth rate of 14.4 percent.


As local advertisers increasingly rely on the Web and mobile devices to reach consumers, BIA/Kelsey predicts that digital media will represent 23.6 percent of all local ad spending by 2015. Local advertising is defined in the report as local spending by small and medium-sized businesses and national and regional advertisers making local buys.


Key drivers of local online ad spending indicated in the forecast include the following:

  • The increased number of smartphones and tablets
  • Continued significant newspaper revenue erosion
  • The rapid growth of new formats such as social and mobile
  • Consumer spending on daily deals offers will grow to $3.9 billion by 2015


This year's forecast presents a comprehensive view of the local media landscape, consisting of 12 key segments: newspapers, direct mail, television, radio, print Yellow Pages, out of home (non-digital), cable television, magazines, online/interactive, mobile, Internet Yellow Pages and other interactive revenues generated by traditional media players.


Overall, local ad spending is expected to reach $153.5 billion in 2015, up from $136.3 billion in 2010 and representing a 2.1 percent growth rate.