Liveblogging Matt Booth’s & Neal Polachek’s forecast for SMB/Local media spending.  Enjoy:

Total U.S. Local Ad Spend should grow from $136B in 2010 to $144B in 2013.  Scary looking drop from $155B in 2008 to $141B in 2009.  A result of the economy and shift to digital.

Local Ad Spend by Medium: All mediums losing share except for digital/online

2013 Interactive Ad Market $58.57B -Search= about $26B of that

– Mobiie, email, reputation management, video, display about where they thought they would be
– Estimating search at $13.9B to $15,5B

– Total searh query volume exceeding targets

– CPC down 3.3 to 1.0% from 2008

– CTR down 12.4% to 3% from 2008 but GOOG rebounding

– Ad coverage up 2.7%

Local search:

– Off $350MM-$100MM from previous forecast

– CPC down -4.8% from 2008; pull back of SMBs of 30% in mid-year

– CTR down 10.6% from 2008; result of advertiser pull back

– Ad coverage down 2.6% from 2008

– Revenue showing robust growth; range 9.6% to 17.8% from 2008

– Expectations is that end of Q3 is when turnaround will be in full swing

Classifieds & Verticals

– Down $1B from 2008

– Classifieds performance terrible -30% Q2 Y/Y; Overall down -21% from 2008

– Non-Auto/RE vertical markets were strong

SMB Ad Spending

– Spending is down 23.5% from August 2008 to Q2 2009, but this appears to be turning around

– Direct mail seems to be coming back

– 6% of SMBs tried PPC this year down from 9% last year, but PPC appears to be coming back

– 8% bought print ads in 2009 v. 13% in 2008

Newer businesses much more oriented to Online Media but newer businesses spend less

– Businesses 0-3 yrs old spend 30% of ad budget online v. businesses 11+ years old spending 13% online

49% of SMBs buy ads themselves (down from 57% last year)

24% buy ads via Print Yellow Pages/IYP sales forces (up from 16% last year)

9% buy via Radio/TV Sales up from 3% last year

8% buy via an agency up from 3% last year

New content models based on analytics such as Associated Content, DemandMedia & are going to be a big trend going forward.

SMBs that intend to use a page on a social site in the next 12 months:
– 44% of new SMBs say yes

– 18-22% of older SMBs say yes

Online Media Usage Reaches Parity with Traditional Media.  Kelsey expects Online to eclipse Traditional over the coming year.

ROI pereception

1. Email

2. Direct mail

3. PPC

4. IYP

5. Print YP

16% of businesses that are <3 yrs old have self-enrolled in Twitter

not even going to try and interpret the chart that’s up there now 🙂

Neal pushing Presence (you need to be where people are looking), Performance (you need to be able to convert & vehicles that help you convert are important) & Permanance


  • Massive shift to digital; “The Cliff” is here
  • Search is already rebounding; expecting growth to continue CAGR ~15% through 2013
  • Geo-targeted display, video, mobile, email & reputation management all meeting expectations
  • Traditional sales forces more competitive with each other.  Digital divide is closing
  • Overall 2010 will be strong for interactive SMB marketing

Neal thinks the broadcast industry will be much more tied to the mobile experience in the future.

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One Response Comment

  • Mike Ramsey  December 9, 2009 at 10:57 pm

    – CTR down 12.4% to 3% from 2008 but GOOG rebounding

    Is this Adwords wide??? I couldn’t believe that stat. Ohh, and that Directory, vertical down 1 billion. If I lost a billion dollars I would just be plain pissed off.

    Thanks for covering this information…