Borrell: Local Online Advertising Cools Off.

Posted by truecreek on October 9, 2009 under More Dam News | Be the First to Comment

By Katy Bachman

Following five years of double-digit growth, local online advertising will moderate next year, growing only 5 percent to $14.9 billion, according to a new forecast from Borrell Associates released Thursday (Oct. 8).

In contrast, this year local online advertising is expected to grow 12 percent to $14.2 billion, with most of the growth coming in the second half of the year.

Over the past five years, local online advertising grew at a compound annual growth rate of 46.5 percent. For the next five years, Borrell is expecting local online advertising to grow at a rate of 2.9 percent. Local online advertising will peak in 2013 at $16.4 billion.

“The local media advertising category is approaching what we believe is saturation,” the Borrell report said. “The game in 2010 will center more around stealing market share than growing the market.”

Next year’s market will be driven by demand for paid search and online directory advertising, while banner sales will decline 10 percent. Both streaming video and audio advertising and email will grow, but still make up a smaller segment of total adspend.

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