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Borrell Releases 2021-25 Local Ad Forecast

Its 2021 forecast is that local businesses will spend $127.3 billion, up 7.3% from the $118.7 billion spent in 2020. The bad news is, the 2021 increase isn’t enough to wipe out all the losses felt in 2020. The advertising marketplace won’t fully recover — that is, grow larger than it was in 2019 — until 2022.
By TVN Staff | March 21, 2021 | 3:13 p.m. ET.

Borrell Associates has recast its local advertising estimates for 2020 and has issued its new forecast for 2021-25. Its 2021 forecast is that local businesses will spend $127.3 billion, up 7.3% from the $118.7 billion spent in 2020.

There’s some drama involved in what happened in 2020, creating wide variances in some markets that didn’t fare as well as others during the pandemic. A lot of businesses failed or cut back the number of employees — two things that fuel Borrell’s numbers for individual local markets.

There’s good news and bad news to this forecast. The good news is, 7.3% a relatively large percentage.  In typical years, total local ad spending grows 2% to 4%. The bad news is, the 2021 increase isn’t enough to wipe out all the losses felt in 2020. The advertising marketplace won’t fully recover — that is, grow larger than it was in 2019 — until 2022.

The local advertising marketplace shrank by $9.3 billion in 2020. In 2021, the forecast is that local advertising will grow by $8.6 billion, a 7.3% increase. That still leaves a $700 million shortfall from where things were in 2019.

Other headlines:

  • Recovery is uneven. Some localities will see variances due to changes in local businesses activity, such as failed businesses or extended statewide lockdowns due to the pandemic.
  • Four of 17 types of media will continue to suffer declines in spending. All are print.
  • The only print-based medium to see an increase is direct mail, which will take its place at the fourth-largest type of media, behind online, TV and radio.
  • In some markets, radio will grow by healthy double-digit percentages, like 13% in Alfalfa, Okla., and 17% in Evansville, Ind.
  • Automotive, restaurants and real estate will be the biggest gainers in 2021
  • By 2025, streaming video advertising will become the largest, surpassing paid search advertising, targeted banners and social media.

Borrell will hold a 30-minute webinar on Wednesday, March 24, to show what’s changed. To register, visit http://bit.ly/Borrell2020

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