BIA has released its U-S Local Advertising Forecast.
It believes total local advertising revenue across all media in the U.S. will reach $137.5 billion in 2021. “This estimate represents a 2.5 percent year-over-year growth from the firm’s final post-COVID estimate for 2020 of $134.1 billion, as businesses start to adapt and rebound from the pandemic lows,” it stated.
“As the expected presence of vaccines will help with the continuing rebound in the economy, we expect this increase will occur throughout 2021 even without the presence of significant political advertising.”
Radio, the company projects, will bring in $12.6 billion in ad revenue. Included in the figure is all spot revenue from OTA radio, from national, regional and local advertisers, as well as radio online advertising.
That performance would be up 1.4% from BIA’s latest estimates for 2020 and it would keep radio at about 9.2% of the local ad pie, “pretty flat” with this year’s 9%.
In 2021, traditional media revenue will account for 55.3% of total local advertising at $76.1 billion, a slight decline from 2020 levels. Digital media revenue will grow to $61.5 billion in 2021 to obtain 44.7% of total local media revenue, a share increase of 3.7% from 2020.
“Although we are estimating an overall increase in total local advertising next year, we do not expect spending to recover to pre-COVID (2019) levels until 2022,” says Dr. Mark Fratrik, BIA’s chief economist. “The availability of a vaccine early in the new year will be a key factor to a much stronger year for almost all vertical advertising as the economy rebounds and consumers start moving around more freely and even going back into the office.”
BIA’s Local Advertising Forecast 2021 provides total nationwide spending estimates for five years, along with 13 individual media forecasts.Explaining the share of wallet between media, Fratrik commented, “This year saw a very strong shift into digital media for its lower costs, accountability, and flexibility. However, it also included substantially improved targeting, attribution, and ROI tools from broadcast TV, broadcast radio and MVPDs that cannot be ignored. Just as the pandemic had a significant effect on the local ad environment, it adjusted how we did our overall forecasting for 2021. Into the new year, we will continue examining the revenue generating opportunities of linear plus digital media activations in our forecasting models.”