New Report Cites Digital Ad Opps

Most local TV, radio and newspaper outlets are leaving money on the table by not focusing on digital media when selling advertising to local businesses. That’s one of the finding in a new joint research study conducted by MFM – the Media Financial Management Association and Borrell Associates.

The just-released study, “Benchmarking Local Media’s Digital Revenues” was designed to provide members of MFM an analysis of current digital ad sales efforts that is coupled with Borrell’s latest advertising estimates for local markets. Copies of the report have been distributed to the association’s members. New MFM members will be receiving a copy of the report as part of their membership packet.

The MFM-Borrell report focused on the 36% of all advertising that is placed in local markets across the U.S. In 2013, according to Borrell’s research, the amount spent by local businesses in their markets amounted to $97.3 billion of a total $268.7 billion. Of that amount, $24.7 billion went to digital media, representing one-fourth of all local advertising expenditures. Borrell says the market is on track to increase local digital ad spending by 42%, to $35.2 billion this year. The research firm is projecting additional growth rates of 44% in 2015 and 37% in 2016, which would mean nearly half of all local ad dollars will be spent on digital platforms within the next two years.

Numbering among the challenges for so-called “legacy” media, such as local newspapers and radio and television stations, is Borrell’s finding that in excess of 50% of current local digital media spending is going to “pure-play” Internet media enterprises. The Borrell-MFM benchmarking report validated this analysis, finding that digital media sales as a percentage of total ad revenue currently stands at 12% for print media and 6% for local broadcasters.

Significantly, the benchmarking survey indicates that slightly more than one-fourth (27.5%) of a local newspaper’s or broadcaster’s existing customers are also buying digital products as part of their ad spend with the media outlet. This finding highlights the huge opportunity for selling digital media services to the three-in-four existing customers that aren’t currently buying digital media.

To help MFM members and others in the industry get the most out of the report findings, Gordon Borrell has agreed to discuss them in a webinar. This special MFM Distance Learning Seminar is scheduled for Tuesday, September 16 at 2:00 Eastern.  For more information: Click Here.