Local Ads To Increase Faster Than Online Ads

    January 28, 2008

Local advertising will increase by 13 percent from 2007 to 2012,faster than online advertising as a whole, which will see 12 percent growth during the same period according to a JupiterResearch report, "US Online Local Advertising Forecast, 2007-2012."

Jupiter Research

Local display and search advertising are in the position to make the biggest impact. With compound annual growth rates (CAGRs) of 18 percent and 16 percent respectively, during the next five years, the categories will benefit from an ongoing strategic push by newspapers and yellow pages publishers along with improved local performance by the major search engines.

"Although traditional media such as newspaper and local broadcast are facing new challenges regarding their business models, local advertising in these media mainstays is not a dying market," explained Lead Analyst Barry Parr, Media Analyst for JupiterResearch.

"The ability to assemble relatively larger general audiences will remain a principal advantage of traditional media."

As search engines, local sites, and local businesses continue to improve their use of simple search engine optimization techniques, the use of search to find businesses and services in the local market will continue to grow. With the local online market being fragmented and relying on search engines for traffic, local media must learn to work in an environment increasingly dominated by the search bar and prepare for competing with national rivals.

In the next five years JupiterResearch believes local advertisers will become more aware of online advertising as an option, have more opportunities, and gain access to improved tools for creating and managing their online marketing.

"At this point, most local advertisers are not marketers and do not have the time or resources to manage, let alone optimize, online advertising campaigns," said David Schatsky, President of JupiterResearch. "Although search is increasing its impact on the local market, it still demands a degree of sophistication unavailable to most local advertisers."