Radio, television and newspaper companies will book $3.1 billion in local mobile advertising this year as small businesses ramp up their spending on the fast growing ad channel. Nearly six in 10 (56.5%) small businesses are using mobile advertising, up from 22.9% of small businesses just two years ago. The new numbers come from the latest Local Commerce Monitor (LCM) survey report from BIA.
While the pie of available mobile ad dollars continues to expand, the vast majority of these budgets are going to mobile pureplay companies. Local advertising on mobile devices sold by pure-play mobile providers will hit $19 billion this year, per BIA. Factor in the $3.1 billion being sold by traditional media companies and the 2018 local mobile total tops out at $22.1 billion. BIA forecasts that figure will grow to $38.7 billion in 2022.
With mobile the fastest growing media channel for local advertising, radio has an opportunity to maximize its investments in mobile apps and websites. Advanced technology – and a growing trove of data – are allowing broadcasters to deliver more targeted ad opportunities and better compete in the red-hot mobile ad space. Radio’s differentiators, station execs say, are its local ties and loyal listeners.
Small business advertisers like the reach of mobile, along with its customer and location-based targeting capabilities, BIA says in the new report. Not only are small businesses increasing their use of mobile, they’re increasing their spend on the channel. “The most rapidly growing media channel for local advertising is mobile, followed by desktop advertising,” BIA chief economist Mark Fratrik says.
The report calls for mobile ad spend to “increase significantly” in the next decade. “As mobile continues to mature, national and small business advertisers see its effectiveness and ability as an all-encompassing platform to reach their audiences,” Fratrik says. “Mobile has become a preferred platform for the advertising dollar because of its ability to capture audiences of all ages based precisely on where they are and what they are doing, at any given moment.”
Radio digital execs and mobile technology providers agree that radio apps are now charged with advanced features for advertisers. Through their apps, radio can deliver mobile ads targeted by location, demographics such as gender and age, and behavioral and contextual targets. By capturing device IDs and gathering information on users from registration, radio stations can direct ads to very specific—and valuable—advertising targets. Next-generation mobile apps are allowing for these possibilities and more. Using data from the apps, radio sales execs can go after new clients and also prove out to existing clients where they should direct more ad dollars. Stations can also sell local businesses on sponsoring sections of the app, such as push notifications with sponsored content or even branded digital exclusive audio streams.
“Many local radio stations have brand names in their respective markets,” Fratrik told Inside Radio in a recent interview. He points to radio stations developing local weather apps, local news apps and local sports apps as “natural extensions of their brands. And, since they know all of the local advertisers, getting a sponsor for those apps is certainly achievable,” he adds.