Borrell and Associates has recast its local advertising estimates for 2020 and issued a new forecast for 2021-2025. It’s 2021 forecast is that local businesses will now spend $127.3 billion, up 7.3% from the $118.7 billion spent in 2020. How does this impact radio?
In some markets, according to Borrell’s new data, radio will grow by healthy double-digit percentages, like 13% in Alfalfa, Oklahoma, and 17% in Evansville, Indiana. Overall, Borrell is forecasting a healthy 6.9% increase for the radio industry, but a wide variance in markets with some being flat and other markets rising by nearly 20%.
Automotive, Restaurants, and Real Estate will be the biggest gainers in 2021
Borrell will hold a 30-minute webinar on Wednesday, March 25, to show what’s changed. REGISTER
There’s some drama involved in what happened in 2020, creating wide variances in some markets that didn’t fare was well as others during the pandemic. A lot of businesses failed or cut back the number of employees – two things that fuel’s 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.