Local Ad Spend in Calif. to Top $18.5B In ’17

Local advertising in the state of California will reach $18.5 billion in 2017 across 12 markets, according to BIA/Kelsey’s local market advertising forecast.

The key vertical markets of retail, automotive and general services (which includes professional services from such as legal services to landscaping) will together spend nearly $8 billion divided between traditional media and online/digital, with mobile advertising experiencing the highest growth. The fastest growing vertical ad category in California is real estate, projected to grow by 29% through 2021.

In the top three California markets — Los Angeles, San Francisco and Sacramento — the spend by the top three verticals varies significantly, according to BIA/Kelsey’s forecast.

• Retail: LA $1.58 billion; San Francisco $815.3 million; Sacramento $361.3 million.

• Automotive: LA $1.03 billion; San Francisco $411.9 million; Sacramento $190.0 million.

• General Services: LA $994.6 million; San Francisco $474.2 million; Sacramento $204.6 million.

“Our California forecast reveals that advertisers still heavily trend to traditional advertising choices like direct mail and TV, however future growth favors digital advertising options,” said Mark Fratrik, chief economist and SVP, BIA/Kelsey. “As digital solutions mature, especially with emerging technologies like voice search and artificial intelligence that consumers are adopting at breakneck speed, there will be new opportunities for local advertisers to market products even more efficiently and effectively than today; hence we see a major shift in ad spend over the next five years.”

Of the 12 media tracked in the firm’s forecast, the top five choices for vertical expenditures in California for 2017 include:

• Direct mail ($4.60 billion)
• TV Over-the-Air ($2.68 billion)
• Online ($2.30 billion)
• Mobile ($1.99 billion)
• Radio Over-the-Air ($1.58 billion)

Over the next five years, local real estate digital and traditional ad spending growth in California is projected to primarily grow through the following channels:

• Online ($197 million)
• Mobile ($155.6 million)
• Television Over-the-Air ($43.9 million)
• Out of Home ($42 million)
• Newspaper Print ($36.2 million).