In its newly released Local Advertising Forecast, BIA Advisory Services estimates total local advertising revenue will reach $137.5 billion in 2021, a 2.5% increase from the firm’s final post-COVID estimate for 2020 of $134.1 billion. BIA projects radio will pull in $12.6 Billion in 2021.
Back in April, before COVID hit, BIA projected radio over-the-air revenue would finsh 2020 with with $13.1 Billion. The firm then revised the radio number to $11.4 Billion when COVID had clearly become a major factor.
The firm predicts the 2021 rebound will take place due to the COVID-19 vaccine being distributed, and despite significant political advertising.
In 2021, traditional media revenue will account for 55.3 percent of total local advertising at $76.1 billion, a slight decline from 2020 levels. Digital media revenue will grow to $61.5 billion in 2021 to obtain 44.7 percent of total local media revenue, a share increase of 3.7 percent from 2020.
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BIA Advisory Services monitors local economic and advertising conditions throughout the entire country. While some areas are still very much recovering, other areas are seeing a renewal in activity. It is always a bit challenging to predict the future and particularly so in tough times like now. However, for the entire year 2021, with the prospect of a vaccine being widely distributed, and a recovering national economy, we believe that local radio advertising will start to rebound from its steep drop in 2020 as activities start to pick up for certain advertisers in businesses like tourism, airlines, gyms, movies, and theme parks. It will certainly take a period of time to return to pre-Covid levels. We base our estimates both on speaking with people within the local radio industry on a regular basis and economic modeling we’ve developed over a long period of time tracking the industry.
Where does BIA Advisory Services get their data from? Our stations just surveyed 25 of our local advertisers from the last 12 months, and not one of them said they could be sure they were even returning to radio, let alone have any idea how much their spending would be. They are in month-to-month survival right now. The mindset of “predicting” now, the mindset of annual contracts or long-term planning, is right now in no way relevant to current times. Unfortunately that is reality.
Agreed. Local looks to be on life support.