Ad spend to increase under 5% next year

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Borrell Associates is forecasting a moderate increase in overall ad spend for 2011, with continued strong growth for online advertising, including mobile. Overall, advertisers will increase their spend next year by less than 5% above this year’s projected level, bringing U.S. ad spending totals to $238.6 billion.


Borrell anticipates total online ad growth of 14% from $45.6 billion to $51.9 billion, with the most among local advertisers. Borrell predicts streaming ad spend will jump 60% in 2011. However most of that streaming will be video: “Streaming audio will remain a footnote,” said the report. In addition, “More DIY and less expensive tools put this ad format within the budgets of even small advertisers. Because of this, two out of every five streaming video ad dollars will come from local advertisers next year.”

Mobile marketing continues to grow, fueled by ubiquitous apps, user-friendly browsers and 3G/4G speeds. As smartphone ownership now comprises 25% of all cellphone ownership, mobile ad sales will enjoy growth of more than 20 cents of every online ad dollar spent next year.

Additional highlights from the forecast memo:
Local online ad spending to increase almost 18% to $16.1 billion in 2011
The fastest-growing segments to be local, anything targeted, and everything involving social media.
Local online advertising will grow by almost 18%, to $16.1 billion, in 2011
Total targeted display (i.e. banner ads) advertising, will grow almost 60% in 2011, reaching $10.9 billion 
Local targeted display will reach more than $2.3 billion in 2011