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Borrell: Local Digital Spending Will Overtake Traditional Media This Year

The most recent Borrell Associates local ad spending numbers and forecast argue that digital media will overtake traditional, “analog” media this year. Borrell says that “local advertising is poised to surge 16.4%, from $113 billion in 2015 to $132 billion this year.”

Just over half of that ($66.4 billion) will be digital according to Borrell. The rest ($66 billion) will be distributed among a range of traditional media, including TV, directories, magazines, newspapers and radio.

Among media, online will capture 49.8% of all local ad spending. Newspapers will grab 10.3%, TV 9.1%, radio 7.6%, direct mail 5.4%, magazines 5.3% and so on down the list. Directories will see 4.6% of local ad spending according to the Borrell forecast.

Borrell forecast
Borrell also argues that “targeted display” will account for roughly 70% (69.4%) of all digital ad spending in 2016 (not just local).

For comparison, the IAB’s 1H 2015 digital ad-spending report reflects that roughly 30% (or so) of digital spending on PC and mobile advertising is display. If one defines display to include video, native ads, sponsorships or rich media, the percentage goes up. By including these categories in “display” data aggregator eMarketer has estimated that the cluster of channels will outpace paid-search spending this year.

An interesting prediction made earlier this year by Lynn Tornabene was that location data become incorporated into every digital campaign. Indeed, location history operates as a kind of substitute for intent (in display) or behavioral targeting in mobile.

And while “location in every campaign” may be a stretch — directionally I agree however — the pervasive use of location data will make numbers like the Borrell forecast above both larger and harder to estimate with confidence.

One Response to “Borrell: Local Digital Spending Will Overtake Traditional Media This Year”

  1. Craig says:

    Greg,

    Thanks – interesting! But not clear on just one point:
    When you report “that “targeted display” will account for roughly 70% (69.4%) of all digital ad spending in 2016 (not just local).”
    …that is 69.4% of what number?

    Is that 69.4% of:
    > “that ($66.4 billion) that will be digital according to Borrell”
    or
    > Because you also said: “Among media, online will capture 49.8% of all local ad spending.”
    … is that 69.4% of only $33.07B? (49.8% of that $66.4B = $33B)?

    Want to get that key point clear here from your article – thanks!

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