Interestingly, traditional local media has a disproportionate share of 2015 spending (87.2 percent). Yet, the online/digital local will grow substantially in the next few years, reaching 20 percent by 2019. This online/digital will be with pure plays, as well as the traditional media that have expanded their services and see the opportunities with this group of advertisers. These health care providers will be extremely interested in greater integration of digital marketing services.

More information on this vertical advertising spending is now available in the recently released report, Insights in Local Advertising – Health Care Vertical, which examines traditional and digital spending trends, profiles the market ad share by media, and details the advertising trends of small and medium-sized businesses (SMBs).

To read the executive summary of this report, just click on “Insights in Local Advertising – Health Care Vertical.“

The post Health Care Vertical – Important to Understand for All Local Media appeared first on BIA/Kelsey - Local Media Watch.

Many of these SMBs, defined as having 99 or fewer employees, do not have the resources to navigate through all of the various options available in the wide advertising/marketing marketplace. Consequently, many media companies, both traditional and digital, are also providing agency type of services to these companies deciding what media to use and how much to spend.

While it can be very time consuming and expensive to deal with many of these SMBs, it is incredibly important for several reasons for all media companies to attack this area. First, collectively, we estimate they will account for over $50 billion of advertising spending in the local media marketplace growing to nearly $60 billion by 2019. The chart below shows that growth along with the growth of the other two segments of local media advertising buyers – national brands, and other local non-SMB businesses.

A second important reason is that while these SMBs initially may not be spending much initially, that spending will grow as the SMB expands its business. Being a trusted adviser to those businesses when they first start out will pay dividends in the long run as their business grows.

Figuring out how to most effectively service this growing segment of local media will be incredibly challenging. But, by focusing on this segment, local media companies – both traditional and digital – will have an important opportunity to prosper.

The post SMB Advertising: A Segment Not To Be Overlooked appeared first on BIA/Kelsey - Local Media Watch.

To effectively compete in this new marketplace, broadcasters must first discover the extent of this marketplace. Specifically, they need to know the size of the advertising spending that is moving to the digital advertising options. The latest BIA/Kelsey national advertising forecast predicts that by 2018 over a third of all local advertising will be digital. They also need to know locally what spending is moving to digital by different business categories, information that is available through BIA/Kelsey’s Media Ad View Plus forecast.

While a considerable amount of that increased digital spending is with pure-play online companies, radio and television stations are increasingly becoming a part of that spending. These local media outlets have the benefits of a local brand image, news and information on the local market, and, a local sales force – “boots on the ground.”

These advantages allow these local stations to move into new areas, and even go beyond just selling related online advertising on their station websites. Several broadcasters have moved into a “digital agency” role with their local businesses, providing needed guidance to local businesses who are overwhelmed with so many new and different choices. Of course, local broadcasters are not the only local media that are trying to fill this role, so these broadcasters need to have well-trained staffs knowledgeable about all of the opportunities out there.

In addition, these broadcasters need to insure that their social and mobile presence is strong. Many Texas broadcasters are doing just that with their on air personalities heavily involved and their news and information available on many different devices.

It was illuminating and encouraging at the same time presenting this information to these Texas broadcasters as many in the audience indicated that they were well on their way to transition their efforts to take advantage of these new opportunities.

The post Broadcasters Moving Digitally appeared first on BIA/Kelsey - Local Media Watch.

In many states, political advertising revenue is a consistent component every two years for certain local television stations, and the industry as a whole. Failing to acknowledge that fact neglects the continuing impact that political advertising has on the present and future health of the local television station industry. Second, for many local television stations situated in competitive markets, political advertising sometimes “crowds out” other advertising, especially in some programs and dayparts. By subtracting all political advertising revenues, the revenue potential of a particular station/market/and industry as a whole is then understated; this could leave viable advertising unsold.

So what is the most efficient way to look at all advertising revenues generated by local television stations while acknowledging the impact of political advertising on a market and industry performance?

We have come up with a way to evaluate local television revenue annual performance. Our method is to examine the annual revenue changes that have occurred and those we predict will occur and have generated a four-year moving average of those annual industry revenue changes. By continuously averaging four years, the impact of two election years (one Presidential) and two non-election years are incorporated into the prediction. By examining the overall historical trend of the four-year moving average, we can highlight the position of local television stations in the ever-increasing competitive marketplace.

What does our examination show? The chart below shows that four-year moving average change in total local television stations advertising revenue for the past 16 years and what we expect in the next five years in the black line, along with the individual years’ annual change noted by the blue stars.

The wide swings in total television advertising revenues are clearly shown by the blue diamonds. Yet, except for the down years around and coming out of the recession, the overall trend in local television advertising averages around 3-4%. That consistency is expected to continue, which will make local television advertising a continuing, important part of the advertising mix.

The post Evaluating Trends in Local Television Revenue from a New Angle appeared first on BIA/Kelsey - Local Media Watch.

Overall we expect national advertisers to increase their spending in local markets from $50.2 billion in 2013 to 68.9 billion in 2018, growing at a 6.5% compounded annual growth rate. The chart below shows the annual estimates of the spending in local media markets by national and local advertisers.

One of the key drivers in this growth is the growth in mobile advertising. While local advertisers will grow in importance, national advertisers will still account for 70% of all mobile advertising in 2018, resulting in over $11 billion in advertising spending. Pure online advertising will also see growth coming from national advertisers, resulting in $20.8 billion being spent in 2018.

Clearly, advertisers of all sorts are looking for all ways to reach their existing and potential customers. Increased usage of local media outlets by national advertisers is just an example of that.

The post National Advertisers Spending in Local Markets appeared first on BIA/Kelsey - Local Media Watch.

Yesterday’s announcement of Comcast/NBCU buying Time Warner Cable was a monumental announcement as it consolidates more of the cable portion of the Multiple Video Programming Delivery services (MVPDs) that includes mostly cable and satellite delivery services. Instead of Charter moving up the list of cable MSOs, Comcast will now be clearly number one if the deal is approved by government officials.

The implications of this acquisition are significant. First. it will allow the merged company to compete more effectively with its increasing number of competitors. In addition to the satellite delivered services (DISH and Direct TV), nontraditional services such as Hulu and Netflix are becoming more competitive “Over the Top” video programming options to subscribing to local cable systems as sources for video programming. Poignantly on the same day as this deal is announced, Netflix announced that they have obtained the rights to a Star Wars animated series.

Second, dealing with the video programming providers (both cable-satellite delivered networks and local television broadcasters) will also be affected as Comcast/NBCU owns several in both categories. Negotiations between the newly merged company and those providers not vertically integrated will be more involved and possibly leading to lower prices (or smaller increases in those prices over time).

Finally, while the cable systems of the newly merged company do not overlap, the combination of these two companies should make them more formidable in the local advertising marketplace. Already, local cable systems are becoming stronger competitors in the local advertising marketplace.

Nationally, BIA/Kelsey estimates that local cable systems have 5.3 percent of the local advertising revenues growing to 5.8 percent by 2017, growing by nearly $1.8 billion. Comcast already is very aggressive in developing local cable advertising, see Comcast Spotlight. Certainly, when dealing with national advertisers, the newly formed company can offer a wider reach than before. National advertisers focusing more on local media markets is an important trend for all local media to consider and will be explored in detail at the upcoming BIA/Kelsey conference, Leading in Local: the National Impact.

While all of these improvements to the newly merged company could occur, the proposed acquisition will face significant scrutiny in Washington. Concerns about too much concentration in program delivery and its impact on negotiations with program suppliers will be front and center when the FCC and Department of Justice looks at this deal.

The post Comcast Poised to Acquire Time Warner Cable appeared first on BIA/Kelsey - Local Media Watch.

BIA/Kelsey’s forecast for local online advertising revenues is that it will soar from slightly over $1 billion in 2012 to $5 billion by 2017. Describing that new media ecosystem was the purpose of the Online Video session at BIA/Kelsey’s Leading in Local conference in San Francisco, CA.

This tour of the online video ecosystem ranged from an content aggregator (Juan Delgado, Sporting News Media) to a content originator (Steven Ludwig, Williamson Source) to a advertising tech platform (Vamshi Sriperumbudur, YuMe). By providing the wide swath of players in the local online video demonstrates the dynamic nature of this advertising vehicle.

Content aggregators like Sporting News Media (part of a larger company that aggregates sports video segments from all sports) have been very successful in driving traffic to their sites even surpassing viewing of larger bigger brand name sites of similar types of programming. This allows them to sell to advertisers and their agencies opportunities that drive the best results, an increasing requirement of such advertisers and agencies.

Local content originator firms like Williamson Source are demonstrating the proof of concept of being able to monetize successfully. In a suburban area of Nashville, TN, this company is developing a considerable amount of original video content and using that content to sell online video advertising. One thing they have already found is the success in selling online video advertising on their live events and locally originated programming – local advertisers want to be associated with that type of programming.

Finally at ad tech firms like YuMe are successfully navigating all of the challenges that online video confronts advertisers. These challenges are:

1. Undertaking proper audience segmentation and targeting
2. Working the media and online channels to execute local campaigns
3. Managing the complexities of multiple creative executions

YuMe provides the solutions to these challenges by providing that targeting ability while offering reach and scale.

While online video is expected to grow substantially over the next few years, it will not occur without a number of pitfalls and mistakes. Many firms will be that are part of this growing advertising media

The post At Leading in Local: ILM 2013: Local Online Video: Anchoring the Next Wave appeared first on BIA/Kelsey - Local Media Watch.

After a remarkable 2012 in political advertising sales, many local television stations this year felt in a comfortable position. Even with all of the online and social advertising options available and used by many political campaigns, local television stations still garnered a substantial amount of that total political spending. Other major advertising categories, such as automotive dealers also continue to increase their spending on local television stations. As a result, BIA/Kelsey projects a continued increase in local television stations’ advertising averaging 3-4% per year over the next few years (higher in even numbered political/Olympic years, lower in the odd years). For the overall forecast, including television, click here.

Investors also had renewed confidence as the price of publicly traded television companies soared, up by over 185% in the first three quarters according to BIA/Kelsey’s stock index of local television station companies.

But, perhaps nothing is more assuring to local television stations than the continued use of local television stations by many digital/online companies. According to a December 2^nd Wall St. Journal article, many digital/online companies are turning to television to broaden their advertising campaign to attract new customers. While many had historically only used online advertising, their switch to television highlights the ability that television stations provide – mass audience reach. For example, Eharmony.com, a major online dating service reportedly is spending 75% of their total advertising budget in television.

Of course, local television stations cannot just rest on this additional advertising. It must continue to “reinvent” itself to compete against the ever expanding number of new competitive media. At next week BIA/Kelsey’s Leading In Local conference these new media will describe their advertising growth strategy.

Yet, much like radio stations in the late 1990s that aired ads from their competitors such as local yellow page companies (use the resonant voice of James Earl Jones), local television stations must have a similar sense of satisfaction when they sell advertising time to these online/digital companies.

The post TV’s Role in Media Advertising Marketplace – Competitor Acknowledgment appeared first on BIA/Kelsey - Local Media Watch.

The strong growth and future prospects for online video for SMBs were discussed by three notable panelists involved in this area at SMB Digital Marketing. Led by moderator, Rick Ducey, Managing Director at BIA/Kelsey, these panelists covered the extraordinary growth in recent years for online video growth. While there has been substantial growth in overall online video advertising, only 1/3 of all SMBs are using online video according to BIA/Kelsey’s most recent Local Commerce Monitor survey.

Olivier Katz of Blue Pixel Media started off the session with a thoughtful speech on what is needed for future growth of online video for SMBs. Three words are paramount: Adapt, Respect, and Evolve. Adapt is simply tailoring the online video advertisement for different types of businesses, campaigns, and media format. Respect refers to respecting the audience, SMB, and media consultant when creating the online video campaign. Finally, evolve represents changing online video campaigns as consumers and businesses change.

Valentine Matrat of Google/You Tube followed those opening remarks with a thorough review of how to be successful with online video. She started her presentation by suggesting that the historical funnel of starting with broad based mass media will be inverted with a more directed form of advertising via online video and other digital media.

She also emphasized three major points when thinking of online video:

* Add value not clutter then steer the conversation and study the signals; remember that online video viewers can turn away from the message at any time.
* Audience let them find you; more than half the people who purchase products are typically not in the target audience
* Launch, Listen, Learn – measure the impact of your ads and gain insights about your audience.

John McIntyre of Sightly, finished up the panel with an engaging discussion of the explosive growth of online video. There are 187 million viewers on online video in the U.S. compare with the 297 million of TV viewers. Online video ads have doubled in the past year alone. He also provided some suggestions on how to most effectively run an online video advertising campaign: Be very hyper local, have strong call to action messages, and study very intensely the statistics surrounding the viewing of these ads.

When it is all said and done, the future for online advertising is extremely promising. The panelist at this session clearly showed the reasons why and that the growth should be phenomenal in the coming years.

The post Video’s Starring Role in SMB Marketing Success appeared first on BIA/Kelsey - Local Media Watch.

Amidst all the talk at the second day of SMB Digital Marketing, challenges faced by small businesses and hard recommendations on the best practices for lead generation was offered by Chris Mancini, CMO of Reply.com. Citing the need for easier solutions for the smaller merchants, Chris provided some insight as to the nature of the problems being faced by these small businesses and how they are responding to them via lead generation techniques.

From a recent survey of Merchant Circle customers, Chris provided some interesting data points on the challenges that these small and medium businesses face when marketing their services:

• 59% of these small businesses cite as one of their biggest challenges the need to address all of their various marketing channels
• 59% get an unsatisfactory ROI form Google Ad Words
• 37% cite low quality leads, 47% say it is difficult to use
• 40% say they spend at least 5 hours a week on marketing their businesses
• Only 19% have developed a mobile web site
• 85% have not conducted a daily deal in the past six months.

In order to provide solutions for these challenges, Reply.com provides a marketplace for these SMBs to conduct lead generation programs. Lead generation allows these SMBs to pay form media that is most suitable for them. This performance based marketing can be outstanding for these small businesses as it allows them to accurately measure the ROI of these marketing expenses. According to Chris, the potential for lead generation has a long way to grow, especially in several different lines of businesses.

What the lead generating programs provide to these SMBs is just another method of these businesses to reach potential new and existing customers in a most efficient way. Reply.com is one of several companies that can help SMBs in this area.

The post SMB Digital Marketing: Best Practices for Lead Generation Detailed appeared first on BIA/Kelsey - Local Media Watch.