4.4% Growth Predicted in Local Advertising for 2024

U.S. local advertising will see a healthy growth rate of 4.4% in 2024, reaching $157.1 billion. While digital formats are the main drivers of this increase, traditional media are also showing signs of stabilization. This trend is supported by the recent Business Barometer from Borrell, which indicates rising optimism about both the holiday shopping season and the overall economy.

Corey Elliott, Borrell’s chief forecaster, notes, “I wouldn’t exactly call it a return to traditional media, but there does seem to be renewed interest in it.” He suggests this may be due to local businesses gaining more marketing experience and recognizing the benefits beyond cost-effective digital campaigns.

2024 Advertising Forecast Highlights

• Digital Advertising: Expected to grow by 6.0%, slightly down from this year’s 7.1%.
• Non-Digital Advertising: Forecasted to grow by 0.4% after a 4.9% decline this year.
• Specific Growth Areas:
  • Digital video formats: +9.3%
  • Digital audio formats: +7.7%
  • Local broadcast TV: +9%
  • Paid search listings: +8%
  • Out-of-home advertising: +3.4%
  • Direct mail: +1.7%
  • Cinema advertising: +2%

Traditional Media Trends

Traditional media formats such as newspapers, cable, and radio are experiencing a moderation in their decline. For instance, print newspaper advertising is forecasted to decline by 4% in 2024, an improvement from a 7.8% decline this year. Similarly, cable advertising’s decline is expected to slow from 5.6% to 3.2%, and radio’s decline from 2.8% to 2.3%.

Elliott explains that local businesses’ increasing marketing expertise, including managing their own websites and social media, is contributing to this trend. Surveys indicate that with more marketing knowledge, businesses are more likely to utilize print, broadcast, and outdoor media.

Economic Outlook

Borrell’s SMB Business Barometer from August shows a notable decrease in economic pessimism, reaching levels not seen since 2018. Only 13% of panelists plan to cut ad spending in the latter half of the year, the lowest in five years.

Long-Term Forecast

Borrell projects that traditional media will continue to decline, but at a reduced rate of 2.3% annually over the next four years, compared to 4.5% in the past four years. Digital advertising growth is expected to moderate, with a forecasted average annual growth rate of 4.4% from 2024 to 2027, down from 8.3% between 2019 and 2023.

Borrell will present the full forecasts in a webinar on September 21 at 1 p.m. Eastern.

Summary

In summary, while digital advertising continues to drive growth, traditional media is seeing a stabilization as local businesses expand their marketing expertise. The overall outlook for local advertising in 2024 is positive, with a 4.4% growth forecasted, highlighting both the potential and evolving landscape of the advertising industry.