Online video to Grow 51.6 % in 2012, According to BIA/Kelsey Local Media Forecast

In its newly released U.S. Local Media Forecast (2011-2016): Full Edition, BIA/Kelsey forecasts local online/interactive/digital advertising revenues to grow 13.1 percent in 2012. According to the forecast, several local media segments are on target to exceed this overall growth rate, such as mobile search, which will grow 77.2 percent. Online video will grow 51.6 percent and social will grow 26.3 percent. For some media, like newspapers, digital ad revenues will be the only source of growth.

“We continue to see a dramatic increase in spending on online media and it is fundamentally changing the media planning and buying process for advertisers,” said Mark Fratrik, vice president and chief economist, BIA/Kelsey. “As businesses examine their advertising opportunities, the trend is moving toward building a coordinated ad plan across different platforms, with different messages across different media. With traditional media getting more than three-quarters of the total local media ad budget, coordination between traditional and online media is the best way to explore how to effectively optimize new media, such as social networks and online video, to increase the chance of achieving business goals.”

According to the forecast, the growth in different local media segments will drive an overall increase making digital over 25 percent of the local ad market.

The U.S. Local Media Forecast (2011-2016): Full Edition examines the entire local media advertising marketplace. It includes a national overview of U.S. spending in local markets and individually forecasts top media segments (e.g., Newspapers, Radio, Video, Television: Over-the-Air & Cable, Out-of-Home, Direct Mail, Directories—Print and Internet Yellow Pages, Magazines, Online, Mobile, Social).

The forecast report details the expected compound annual growth rates (CAGRs) for specific digital media. Breakout media segments like mobile, video and social are reaping significant revenue from ad dollars. For media segments like newspapers, established digital platforms are providing opportunities to migrate important sectors of advertising to online and offset negatives in the print portion of the business.

CAGRs for the forecast period, 2011-2016, for digital/interactive revenues in key media segments are as follows: newspapers – online revenues: 5.0 percent; radio – online revenues: 11.8 percent; television – online revenues: 12.8 percent; digital out of home: 11.7 percent; online: 9.4 percent; mobile: 44.9 percent; Internet Yellow Pages: 12.5 percent; email, reputation and presence management: 14.9 percent; social media: 21.0 percent; and online video: 36.7 percent.

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