BIA/Kelsey: Local Mobile Ad Revenues to Pass $2B in 2014

September 28, 2010

Chantilly, VA - Sep 28, 2010 - U.S. mobile local advertising revenues will increase from $213 million in 2009 to $2.02 billion in 2014, representing a compound annual growth rate (CAGR) of 56.9 percent, according to a newly released update to BIA/Kelsey's U.S. Local Media Forecast (2009-2014).

BIA/Kelsey defines mobile local advertising as advertising that is targeted based on a user's location and/or advertising that is locally actionable. For large and small advertisers alike, location targeted ads will command premiums over non-local advertising, due to higher immediacy, consumer buying intent and conversion levels.

"We expect advertisers will be drawn to mobile marketing as the overall market shifts to digital ad platforms," said Neal Polachek, president, BIA/Kelsey. "A lack of traffic to fulfill quotas on geotargeted ads will likely accelerate mobile Web site and application development by publishers."

Regarding influencers of mobile ad growth, Michael Boland, senior analyst and program director of BIA/Kelsey's Mobile Local Media practice added, "As we've seen in the online space over the past decade, tools will be introduced to democratize and localize the mobile ad buying process. Google has already begun to bundle mobile ad placements within its pervasive AdWords search marketing platform."

BIA/Kelsey cites smartphone penetration, mobile Web usage and related increases in ad inventory as additional mobile ad growth drivers.

BIA/Kelsey expects total local advertising to grow from $130.6 billion in 2009 to $145.2 billion in 2014, representing a CAGR of 2.1 percent. Comprising total local advertising is traditional local media, which will decline from $115.1 billion in 2009 to $110 billion in 2014, a CAGR of negative 0.9 percent, and online/interactive local media, which will grow from $15.5 billion in 2009 to $35.2 billion in 2014, a CAGR of 17.4 percent.

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