CHANTILLY, Va.—The BIA Advisory Services has done some recalculations and is now projecting the total local media marketplace for 2019 to be higher than expected earlier in the year, with ad revenue now estimated to reach $148.8 billion. BIA cites three key reasons for this update: a strong economy, an early start to the 2020 election and increases in mobile and mobile-social advertising.
As for how ad revenue is predicted to be split up, $89.2 billion (60%) will be earned by traditional media, with $59.5 billion (40%) going to digital media. Online/digital advertising revenue is expected to continue to grow, however, at a CAGR of 9% from now to 2023, while traditional advertising revenue will see a CAGR of -1.4% over the same period.
Local video is expected to be the second biggest contributor to ad revenue (only behind direct mail), generating $29.5 billion (a 19.9% share). Local video covers OTA TV, local cable, local online video, out-of-home video and mobile video; online, out-of-home and mobile video’s ad revenue is a key in local video remaining competitive.
Mobile and online/interactive ad revenue will make up a combined 28.2% of the market share, while local radio rounds out the top five sources, earning 9.8%.
“Although it’s a non-political year, the sheer number of Democratic candidates running and the significant attention this presidential race is garnering is driving earlier than usual advertising revenue across television and mobile/social channels,” said Mark Fratrik, senior vice president and chief economist for BIA. “Additionally, we are more bullish on certain digital advertising platforms like mobile due to its targetability, measurability, attribution and high level of adoption by consumers.”
The updated U.S. Local Advertising Forecast 2019 report can be viewed here.