BIA/Kelsey: National Brands to Increase Local Ad Spending

Thu Jun 1, 2017

Kathy Crosett

As consumers continue to show interest in buying local, national brands are changing strategies. Marketers get that shoppers localwant products with a local connection, and that they also respond to personalized messages. The Win of Going Local, a BIA/Kelsey report produced with Mediamax network, lists the ways local media sales reps can tap into the increased national ad money that is targeting the local market.

BIA/Kelsey analysts divide the local advertising market by buyer type, along with this year’s anticipated ad spending and the projection for 2020 (in parentheses), as follows:

  • National brands $62.7 billion ($73.4 billion)
  • Non-SMB local advertisers $33.3 billion ($34.6 billion)
  • Local SMBs $53.7 billion ($60.9 billion)

These projections point to a robust local ad market. In particular, national brands plan to increase local market spending by greater rates than their competitors. Media sales reps should know that franchisees will account for some of the local ad market spending associated with major brands. The parent company also buys advertising in local markets to support franchisees, so reps may be able to tap into that money as well. The level of local ad market spending controlled by the parent organization varies by vertical as the following BIA/Kelsey chart shows:

  • Retail 55.4%
  • Professional services 50.9%
  • Financial services 31.1%
  • Home/Trade 25.7%

Marketers are taking advantage of the synergies between digital and traditional media formats. According to BIA/Kelsey analysts, over 18% of SMBs, some of these are franchisees associated with a national brand, use magazine advertising. Of these marketers, over 50% experienced an ROI on their print magazine investment of 5x. The power of digital can’t be overlooked, especially when parent (national) organizations share data with local dealers. National brands may have the resources to gather data on a large scale for local dealers. Using this information, along with their knowledge of the local market, dealers can ‘localize’ their ad campaigns. When the ads are produced and localized through digital formats, dealers can use data from their parent organizations to adjust their media mix and increase ROI.

Media sales reps should be talking with local outlets associated with major brands to discuss increased spending in their market.

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About Kathy Crosett

Kathy is the Research Director for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel.

View all posts by Kathy Crosett
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