Advertising on local online media properties is rapidly becoming a force to be reckoned with, according to a new research report from Borrell Associates. In “What Local Web Sites Earn: 2005 Survey,” the company forecasts local online spending will hit $3.9 billion in 2005.
Local online spending growth will be 46 percent higher in 2005 than 2004’s $2.7 billion. That sum represents a 28 percent increase over 2003 spend. Some 2,177 local media properties were analyzed as part of the report.
The leading metro area for local online spending is forecast to be New York City for the third consecutive year, with a 2005 spend of $240.49 million, an increase of 30.6 percent over 2004. Los Angeles and Chicago hold the next two spots, growing at 32.5 and 31.7, percent respectively. The Washington, D.C. area showed the high year-over-year growth in spending; 69.8 percent growth propelled it to the number four spot (with a $91.83 million spend) on the list. The San Francisco-Oakland-San Jose metro area ranked sixth ($90.03 million), behind Philadelphia at $91.03 million.
|Projected U.S. Local Online Ad Spending, 2003-05|
|Spending Rank||DMA||Local Online Ad Spending ($ millions)||Change (%)|
|1||1||New York City||$137.15||$184.09||$240.49||30.6|
|Source: 2005, Borrell Associates Inc. and Ad Audit Services, 2005|
The leading category in the survey was newspaper-controlled Web sites, which reaped $1.19 billion in local online ad revenue, representing 44 percent of all local online advertising spending. The 2004 share is in an increase of 5 percentage points over newspapers’ 2003 share. That share is being built partially through up-selling print advertisers. Nearly half of newspapers’ online revenues are reported to come from existing print advertisers.
Internet pure-plays, such as AutoTrader.com, Monster, and HouseValues, captured 40 percent of local online spend. TV reaped 4 percent, and radio captured a meager 1 percent. TV stations are on a rapid growth clip, with a 58.8 percent increase in revenues last year (to $119 million). Radio stations, in comparison, grew revenues 91.4 percent (to $34 million).
|Click on graphic to view chart|
Borell VP Colby Atwood noted the researchers were impressed by the progress radio stations have made in capturing local online advertising. “We knew that television stations were getting traction on the Web, but we thought radio was another year behind where they appear to be,” Atwood told ClickZ Stats. “The proliferation of broadband and MP3 players has opened up many options for non-traditional distribution of audio files in the last year or two, and the softening radio ad market has added to the pressure on the radio industry to seek new revenue streams.”
According to Atwood, Borell expects both TV and radio broadcasters to see high growth in local ad sales. “There’s a lot of experimentation going on among broadcasters, and some of that will pay off,” he said. “Now that audio and video are feasible on the Web, they will begin to catch up to the market shares that they have in traditional media compared to print media.”
According to a survey conducted as part of OnBrand Magazine's State of Branding Report 2017, marketers are well aware of the new technologies that are expected to be important to their brands in coming years, but the majority aren't rushing to invest in them before they're fully-baked.
Facebook advertising has come a long way in the past few years, and it provides a highly profitable way for brands either to engage an existing audience or grow new ones.
The rise of YouTube and digital video generally has a lot to do with the rise of the internet and the abundance of digital video content. But YouTube's ascendency is also the result of Google's savvy use of algorithms.
In January, following U.S. President Donald Trump's temporary immigration ban, Starbucks announced that it would hire 10,000 refugees over the next five years.