BIA Lowers Forecast For Local Advertising

Local advertising is expected to total $161.7 billion in 2023, according to BIA Advisory Services, which lowered its estimate from $165.7 billion.

The outlook was dampened by a decrease in digital advertising and a slow start for the economy this year, reports NextTV.com.

Over the air radio is expected to produce $10.4 billion in revenue. Radio digital is on track to grow 4.1% to $2.8 billion for total radio revs topping out at $13.2 billion. That’s down from the political advertising-boosted $14.0 billion estimate for 2022 and off from 2023’s earlier radio forecast of $13.5 billion. Over the air TV is forecast to inch up fractionally to $16.0 million while TV digital will increase 4.9% to $1.8 billion for a TV total of $17.8 billion.

Over-the-air broadcast TV is expected to grow 0.2% to $16.08 billion, while digital TV is seen growing 4.9% to $1.8 billion. Local connected TV and over-the-top is forecast to be the fastest growing media category, jumping 18.5% to $2.4 billion.

“Both linear TV and digital budgets are fueling the growth of CTV/OTT, as well as new dollars from publishers and aggregators that are using the channel to extend their programmatic platform to long tail businesses,” said , BIA’s Managing Director, Rick Ducey, said, “Both linear TV and digital budgets are fueling the growth of CTV/OTT, as well as new dollars from publishers and aggregators that are using the channel to extend their programmatic platform to long tail businesses.”

Traditional media is expected to generated $84 billion, little changed from BIA’s original forecast, while digital is now slated to bring in $74 billion, down from the earlier forecast of $81 billion.

“After Meta, Alphabet and others lowered expectations for 2023, we examined local digital advertising spending revenues over the first six months of the year and determined a reduction was necessary,” said Nicole Ovadia, VP, forecasting and analysis at BIA. “After years of double-digit growth, we are seeing some headwinds that will have a significant impact on digital local advertising. For traditional media, while we’ve made changes to certain media and categories throughout our forecast, the total ad forecast for this segment remains consistent with our original expectations.” 

BIA said hat later in the year, growth is expected in the auto category, particular at Tier 3 new car dealers and repair services.

BIA is also  raising its forecasts for sayings and credit institutions, plumbers and HVAC and real estate. 

While political advertising will be a huge category in 2024, BIA anticipates some spending to begin later in 2023.

The updated local advertising forecast lowers estimates for online gambling, office supplies and stationery stores, auto & direct property insurance and, health & personal care stores.