66% Of Marketing Budgets Go To Local Ads

BIA Advisory Services’ newly released 2018 Survey of Advertising and Marketing (SAM) activities of U.S. businesses indicates that they direct almost two-thirds of their marketing dollars into activating local media ad platforms and the remainder into promotions.

For businesses with 500 or more employees, this spending averages $4.48 million for advertising and $2.18 million on promotions. The 2018 U.S. SAM survey uses a sample of 1,500 businesses of all sizes doing local advertising and promotions, including local, regional and national businesses for insights into historical and intended marketing practices.

“The significance and strength of local is revealed in the finding that overall U.S. businesses invest about two-thirds of their total marketing budgets (promotions plus advertising spending) in advertising on local media ad channels,” said Celine Matthiessen, BIA’s VP analysis and insights and SAM study director. “Those businesses in the top category, (500 more employees) had average total marketing (advertising plus promotions) budgets of $6.66 million, of which 67.3% ($4.48 million) was spent in the past 12 months on advertising. Businesses in the next category, 100-499 employees, spent an average of $259.9 million in their total marketing budget, of which 61.5% was spent on advertising.”

The top five media for advertising and promotion include targeted social ads, email, direct mail, direct home and mobile location aware. With each offer hyper-audience targeting, three major trends are apparent:

• Social ad channels are popular for reaching targeted audience segment. Nearly two-thirds (61.2%) of businesses advertising in local market use “Targeted Social Ads” as part of their media mix.
• Each of the top five media channels offer deep targeting, whether individual targeting as with email (49.3% usage) and direct mail (37.6% usage), or with household targeting with “Direct Home” (35.7% usage) media like door hangers.
• The prominence of a mobile ad channel, “Mobile Location Aware” (35.5% usage), does audience targeting based on geofencing or geotargeting.

“As businesses continue their push to target local consumers, the media that delivers deep analytics to them will be the preferred choice for businesses’ advertising and marketing dollars,” said Matthiessen.