Borrell Associates believes that radio will miss out on an overall rise in local ad revenue – see where the money will go
By Paul Marszalek
The amount local advertisers plan to spend next year will rise by 6.4%, according to Borrell Associates‘ Local Advertising Forecast for 2022.
It’s welcome news for just about everybody, except print and radio.
Unfortunately, radio’s share of local advertising is expected to contract by 4.6%. The big winner? Streaming Video and OTT.
By percentage, Streaming Video and OTT will bounce back by 18.5%, Streaming Audio by 17.8%, and Local TV 12.3%.
The Streaming Audio piece of the puzzle offers some hope to radio, but it should be noted that it is a small category — in other words, a relatively small amount of money in the category will increase by roughly 18%. Regardless, it’s the primary digital offering radio brings to the table and it needs to be maximized.
By 2022, Borrell forecasts that a full 67% of all local advertising will be with digital media. That’s up from 50% just five years ago.
Worth noting, Borrell does not believe that local podcasts will carve out enough audience to grab Streaming Audio advertising dollars for any but the largest of stations.
Using 2019 as a benchmark — the last “normal” year — the chart below tracks the winners and losers in real dollars.
Looking to 2025, Borrell sees 75% of all digital spending coming from just three sources: Search, Social, and Video. The company believes that local ad spending on video take the lead, surpassing Search in 2025, at roughly $27 billion.