Local Advertising Changes Could Provide Boon for App Publishers

Very few app publishers have the opportunity to take advantage of local advertising revenues. Part of the problem has been the ability for smaller local advertisers to tap into the reach of the plethora of apps that serve in-app advertising.

While well known publishers like Pandora and Zinga have made some inroads into tapping into the local advertising market, it’s been difficult for local ad agencies and individual local advertisers to take advantage of emerging opportunities such as the geo targeting capabilities of today’s apps.

The sheer volume of this opportunity has been outlined in a new report, Local Advertising at the Tipping Point, which is part of an annual series of reports by Borrell Associates. The publication is the result of a survey of 7,228 SMBs (small and medium businesses) to determine their current philosophy and future plans for advertising. The report found that local advertisers are rapidly moving out of print and directories, increasing radio/TV buys and moving swiftly into digital services.

The 49-page report includes 20 charts and tables, an appendix listing local digital ad-spending estimates by each format (banners, email, paid search, etc.) for 513 U.S. markets, and a full list of survey questions. Findings include

- Of all media, print directories are being earmarked the most for cuts. Survey shows 33% are expecting to cut directory spending in next 12 months.

- The survey shows twofold increase in percentage who say they plan to increase radio or TV budgets in next 12 months. 

- Native advertising is catching on with 25% of SMBs now buying.

- 82% of SMBs have established their own media channel in the form of a website or social media page with 72% of them purchasing digital services to support those channels.

The report covers SMB (with vertical breakouts) spending on all media types, including shifts in social and mobile usage. An interesting phenomenon that has come out of the survey is a trend over the last five years for overall advertising budgets to increase. This could be a function of businesses adding funds for digital initiatives but not making correspondingly reductions in their other advertising.

The full report is available as a download on the Borrell Associates website.