CHANTILLY, Va.—In an update to the 2024 U.S. Local Advertising Forecast, BIA Advisory Services is now estimating that revenues across all local media in the U.S. will reach $172 billion in 2024, an increase of 9.3% over 2023.
As part of the slightly downward revised forecast, BIA is predicting that TV over the air (OTA) will be up 28.3% and TV digital will grow by 24.9%.
The spending bounce will be driven by local political and other key local vertical ad spend, and significant ad growth for connected TV/over-the-top (CTV/OTT), TV OTA, and TV digital. Even so, the forecast reflects a reduction of 2.0% from BIA’s October 2023 estimate.
“As expected, local political advertising will be substantial this year, and it’s fueling spend across the media landscape,” said Nicole Ovadia, vice president of forecasting and analysis, BIA Advisory Services. “Our slight adjustment down for this year is mainly due to mixed economic signals, a slowdown in certain consumer purchases, and lower than expected spending in digital and direct mail advertising at the end of 2023 that may flow into this year. However, we still anticipate 2024 to be better for local advertising than 2023 and certain media like TV OTA, TV digital, and CTV/OTT are growing substantially.”
The 2024 forecast update shows a small increase in expectations for local political advertising. BIA estimates $11.1 billion in spending this year, up 15.5% from 2020. Local television will continue to get the largest share of the spending, with forecasted increases in local political advertising going to CTV/OTT.
The split between traditional and digital advertising shows that digital has a slightly smaller share, 48.7% of the overall advertising spend at $84 billion. Traditional media ad revenue is slated at 51.3% of the ad spend at $88 billion. Growth is occurring in both types of media. TV OTA (+28.3%) and TV digital (+24.9%) are both projected to grow this year, even when looking at forecast estimates with and without political advertising.
The breakout media this year will be CTV/OTT, whose growth can be attributed to high quality and more accessible inventory through the programmatic market, increased costs per thousand (CPMs), and demand to generate higher overall revenue. BIA forecasts that in 2024 CTV/OTT will grow 53.8%.
“Political and issue campaigns are recognizing that the combination of premium TV and targeted advertising can make a strong impact, using the same kinds of data ad buyers need with digital media,” said BIA’s Managing Director Rick Ducey. “Another factor supporting this growth is that we are observing spending leaking out of search and social and going into CTV/OTT.”
BIA’s local advertising forecast covers 96 local verticals. Key vertical takeaways from the forecast include the top three fastest-growing verticals year-over-year: political (+1975.2%); real estate (+12.5%); leisure and recreation (+4.7%).
Key local business verticals declining year-over-year include: health (-3.3%); general services (-2.5%); automotive (-1.0%).
“Beyond political, one category to also watch is real estate, as there’s been so much pressure around home prices and interest rates,” said Ovadia. “We believe later this year when rates start to decrease, a flurry of activity will generate increased advertising, especially by realtors. Declining verticals like health are level setting from the pandemic but certain key areas of this vertical are holding spending steady and even increasing. Auto will not make a full recovery to pre-pandemic spending levels through the end of our forecast period in 2027.”
More information is available at http://www.bia.com.
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