Non-political local ad spending is expected to increase 5.5% to $171 billion in 2025, according to a new forecast by BIA Advisory Services.
For the first time, digital spending will eclipse spending on traditional advertising in local markets, with digital accounting for 52% of the ad dollars, BIA forecasts.
When including political advertising, local ad spending is expected to be down 1.3% in 2025, compared to BIA’s revised forecast for 2024.
BIA raised its 2024 forecast to $173.7 billion as it increased its estimate for political ad spending by $560 million to $11.7 billion.
Local television continues to get the largest share of the spending. At the same time, the firm projects that connected TV/over-the-top (OTT) will receive much of the additional political ad dollars added to the mix.
“With macroeconomic conditions impacting 2024 local advertising spending, it has been slower than anticipated, and we've adjusted this year’s forecast,” BIA Advisory Services VP of forecasting and analysis Nicole Ovadia said.
In terms of 2025: “We’re taking a nuanced view to shape our expectations,“ Ovadia said. “If the Fed adjusts interest rates as indicated, post-Q1 2025 or early Q2, and inflation cools and the labor market settles out, we anticipate some economic relief by midyear. This will boost consumer confidence and, subsequently, increase media ad spend. While we’re optimistic, we're also being cautious with our projections at this early stage.”
For 2025, BIA sees local PC/laptop advertising growing 13%, CTV/OTT up 9.1%, out-of-home up 5.9% and TV digital up 5.4%.
“In previous forecast rounds, we reported robust growth in CTV/OTT, but different factors have led us to moderate expectations around the speed of that growth,” BIA managing director Rick Ducey said. “One factor is that while streaming viewing is growing, there’s less available ad minutes in streaming versus linear TV. However, this channel continues to present valuable opportunities for advertisers due to how it combines the power of premium TV with the precision of digital audience targeting. Political and issue campaigns are tapping into this capability, and it will be interesting to unpack the use cases and outcomes.”
