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BIA/Kelsey: Local Ad Spending Goes Mobile and Online

Large increases expected from finance, tech and health care

This story originally appeared in TV Technology.

Local ad spending is on the move — literally and figuratively — to mobile devices and online. That’s the latest finding from the folks at BIA/Kelsey.

“Mobile and online will account for the largest increase in local ad spending, nearly doubling from $11.1 billion in 2011 to $21.8 billion in five years,” the market research firm said today.

All local ad spending will increase at a 2.6% compound annual growth rate in 2011-16, from $132 billion to $150 billion. Mobile will then comprise nearly 15% of local ad spending in four years.

Among categories going mobile, BIA/Kelsey said tech and telecom is on track to spend $5.1 billion in 2016, an increase of 81%. Retail is expected to spend $4.5 billion; automotive — TV’s big spender — will go mobile to the tune of $2.6 billion; and health care will account for $815.3 million of local mobile ad spending. BIA/Kelsey’s Mark Fratrik said TV and radio continued to “hold their own” despite the increase in alternative platforms.

“Out-of-home, online and mobile are having an impact on the overall share,” he said. “Newspapers are also positioned very well to continue to drive online ad revenues.”

The position of newspapers also was affirmed this week by Berkshire Hathaway’s purchase of Media General’s newspapers for $142 million. (See “Media General Scores Backing from Buffet.”)