Small Market Advertisers Spend 75% of their Budget with Local Media Companies

Thu Nov 10, 2016

Kathy Crosett

Yesterday, we highlighted projections for the local advertising market as seen from the perspective of BIA/Kelsey retailstoreanalysts. Another research shop, Borrell Associates has also weighed in with an opinion on what will happen in the local ad sales sector next year.

Borrell estimates the local ad market is worth about $133 billion. Of this amount, local media sales reps sold about $10.5 billion in ads last year. Local newspaper companies hold the largest percentage of these sales – about 50%. The Borrell study also indicates that the online directory market at the local level is worth about $2.4 billion in media sales. Local TV stations are having more success selling digital at the local level with about $650 million in revenue. Local radio sellers are also having success in the digital ad market when it comes to convincing the neighborhood garden center or auto repair shop to give digital spots a try.

The typical small market advertiser is spending about 75% of its ad budget with companies like yours. But, as BIA/Kelsey analysts remarked, the interest in digital is growing. Media companies have noticed. Nearly half, 48%, have formed digital agency services in the past 4 years. If your company is like most others, you’re selling website development and management services, SEO assistance, and online video production.

There’s no question that you’re facing more competition from the likes of Facebook, Yelp, and Google. In some cases, you can preserve a portion of your sales by acting as an intermediary between these large players in the digital space and your locals clients. Keep in mind that you’ve formed a relationship with clients who trust you. As you prospect for new clients in your market, remind them that you’re the expert in local.

The Borrell study highlights a key additional opportunity for media companies in the local market, and it’s all about events. With many consumers seeking experiences these days, marketers are anxious to use events to attract business. The typical marketer has little experience in or time to manage events. Media companies are increasingly offering event management and related marketing services at rates which result in high profit margins.

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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