In October of last year, BIA Advisory Services predicted a tidal wave of local ad spending fueled by political revenue. Now, two months into 2024, BIA has tempered its US Local Advertising Forecast for the year, and while it’s not necessarily good news overall, it does bode best for television in terms of most impressive growth.
BIA VP of Forecasting & Analysis Nicole Ovadia commented, “As expected, local political advertising will be substantial this year, and it’s fueling spend across the media landscape.”
“Our slight adjustment down for this year is mainly due to mixed economic signals, a slowdown in certain consumer purchases, and lower than expected spending in Digital and Direct Mail advertising at the end of 2023 that may flow into this year. However, we still anticipate 2024 to be better for local advertising than 2023 and certain media like TV OTA, TV Digital, and CTV/OTT are growing substantially.”
BIA’s 2024 U.S. Local Advertising Forecast predicts a 9.3% increase in revenue across all media, reaching $172 billion despite a 2% reduction from the previous estimate of $175.6 billion due to mixed economic indicators and slower consumer spending.
The updated forecast also shows an adjustment in local political ad spending projections, with an estimated $11.1 billion, a 15.5% increase from 2020. Television continues to dominate political ad expenditures, with a notable increase in CTV/OTT investments.
In the breakdown of traditional versus digital advertising, digital is projected to constitute 48.7% of the overall ad spend, amounting to $84 billion, while traditional media ads are expected to make up 51.3%, totaling $88 billion.
Significant growth is forecasted in both media types, with TV OTA and TV Digital experiencing substantial growth rates of 28.3% and 24.9%, respectively. CTV/OTT stands out with a predicted 53.8% growth, driven by quality inventory, higher CPMs, and increased demand.
“Political and issue campaigns are recognizing that the combination of premium TV and targeted advertising can make a strong impact, using the same kinds of data ad buyers need with digital media,” said BIA Managing Director Rick Ducey. “Another factor supporting this growth is that we are observing spending leaking out of search and social and going into CTV/OTT.”
The forecast, covering 96 local verticals, indicates the fastest-growing sectors to be political, real estate, and leisure and recreation. Ovadia anticipates a surge in real estate advertising later in the year as interest rates potentially decrease, sparking activity in the market.
Conversely, health, general services, and automotive are expected to decline, with auto not projected to return to pre-pandemic spending levels by 2027.
The full, updated 2024 US Local Advertising Forecast is available to BIA ADVantage clients as well as separately on the BIA site.
