Local television advertising revenues could total $20.8 billion next year, according to BIA/Kelsey’s U.S. Local Advertising Forecast.
The firm said TV ads will account for more than 60% of the local video advertising market, but that revenue growth within the local video advertising segment will come from local mobile video (growing to more than $1 billion) and local online video (increasing to more than $2 billion).
In all, BIA/Kelsey predicts local advertising revenue in the U.S. will reach $151.2 billion in 2018, up from $140.9 billion this year, up 5.2%. Traditional media will take up 64.7% of the revenue, and online/digital will account for 35.3%.
“The strong economy and the expectation of highly-competitive statewide political races next year reinforce our outlook that local advertising revenue will show strong growth in 2018, in fact, higher than we’ve seen for five years,” said Mark Fratrik, chief economist and senior vice president at BIA/Kelsey, in a statement. “Combine these factors with the continued strength of traditional and online media and the revenue landscape for next year looks robust.”
The overall growth for local advertising projected by BIA/Kelsey comes after earlier this year the firm adjusted its estimates for this year down to $147.9 billion. The firm blamed the decrease on an overall weaker than expected economy in the beginning of 2017 that has led to softness in advertising revenues. But the firm raised its future growth in online/digital advertising revenues estimates to a CAGR of 11.9% from 2016-2021. Over the same period, traditional advertising revenues will see a slight decrease in the 2016-2021 period with a CAGR of -0.6%, according to a news release.
"We are on the precipice of different advertising channels taking lead positions in the local advertising marketplace," said Fratrik. "Although national and local businesses still utilize a mix of digital and traditional advertising platforms, the opportunities afforded by mobile, social and video advertising are incredibly valuable due to their measurability, adoption by consumers and enhancements by technologies such as beacons and data attribution that blend extraordinarily well with today's mobile consumer."