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Tag: BIA/Kelsey

  • Franchise SMBs To Spend 1/2 Of 2015 Ad Budgets Online

    Franchise small and midsize businesses plan to spend about half of their annual ad budgets on digital, according to a new report from BIA/Kelsey. It found that these businesses, on average, spent $87,165 on advertising and promotion during the 12 months ahead of the survey, which is up from $57,072 the year prior. On average, they spent 39.1% of their total ad budgets on digital media during that time.

    Those same businesses said they intend to increase their digital spend to 42.9% of their total ad budget during the 12 months following the survey, which compares to 33.8% for SMBs overall.

    “Franchises are one of the most distinctive SMB segments,” said Steve Marshall, director of research, BIA/Kelsey. “In almost every metric, franchises act differently from the overall SMB sample. In general, franchises are taking a tighter and more disciplined approach to their customer relationships. They’re using more marketing tools and platforms, loyalty programs and social media.”

    BIA/Kelsey says the the businesses it surveyed “demonstrate a remarkable willingness to experiment” with digital media and platforms. When it comes to social, 26.4% use Twitter, 24.6% use Twitter ads, 15.7% use Instagram, and 11.5% use Pinterest.

    The Twitter numbers are interesting. Earlier this month, Twitter announced a new ad offering aimed at SMBs called “Quick Promote,” which lets them promote their best performing tweets from the Tweet activity dashboard.

    “Promoting a Tweet takes just a few clicks and your Tweet will automatically be targeted to users who have interests similar to your followers — the audience that is most likely to be interested in your message,” said product manager Buster Benson. “Whether you’re Tweeting about a new product, promotion or blog post, Promoted Tweets can help you drive measurable business results. In fact, we found that users who see a relevant Promoted Tweet from an SMB are also 32% more likely to visit that business.”

    If you’re a small to midsize business just getting started on Instagram, Gary Jordan of TheInstagramExpert.com recently shared some thoughts on that with us here. On the subject of Pinterest, we also spoke with with longtime Pinterest marketer Vincent Ng, and got some great tips about that.

    2.6% of those franchise SMBs surveyed by BIA/Kelsey use mobile banner or display ads, while 21.6% use mobile deals, and 19.3% use text messaging. 23.6% use online deals, while 22.6% use website video, and 16.3% use video banner or display ads.

    “Many franchise SMBs work with digital or advertising agencies, with 49.3 percent reporting they have worked with an agency for two years or more,” the firm says. “Among those that work with an agency, 87.7 percent are either ‘very satisfied’ or ‘extremely satisfied.’ The most widely used channel by franchise SMBs for purchasing online advertising is their advertising/digital agency (36.5 percent), followed by TV stations (28.9 percent), self serve without assistance (28.2 percent), self serve with assistance (27.9 percent) and newspapers (26.9 percent).”

    Take a look at this infographic they put together illustrating some of the survey’s findings:

    We recently looked at another study by BrightLocal, which found that despite finding online marketing effective, half of SMBs allocate less than 30% of their marketing budgets to online channels.

    “I found this figure a little perplexing when you consider the other responses SMBs gave,” BrightLocal CEO Myles Anderson told us in an interview. “75% said online was effective at bringing in new customers & 3 of top 4 most effective marketing channels are ‘digital’. Yet SMBs allocate a disproportionately low % of their marketing budgets online.”

    That study also found that there is a direct correlation between the number of employees the business has and the monthly online marketing budget. Here’s a look at company size vs. planned spend on internet marketing for this year:

    On Tuesday, Facebook announced that it now has over 2 million active advertisers, building on its 30 million businesses using Pages. It also launched a new Ads Manager mobile app, which will help businesses manage their budgeting from their phones (iPhone only for now, Android coming later this year).

    Facebook has not been incredibly kind to small business online marketing budgets over the past year or so. What businesses were once able to get for free, they’re now having to pay for more and more.

    We recently talked about this with Facebook marketing expert Mari Smith, who told us, “I would recommend that low budget[s] be allocated to what are called ‘dark posts.’ That is, ads in the News Feed that look like a Page wall post, but don’t actually appear on the Page. With very granular targeting to reach the exact target market, small businesses can do exceptionally well using Facebook. In addition, making use of custom audiences is a must. This is where a business can upload its own email database, or segments thereof, and place ads in the News Feed to that target group. Plus, using website custom audiences helps a business to retarget its website visitors with Facebook ads.”

    “Being able to boost (and target) posts that are already performing well is a great help to small businesses,” James Whatley, the social media director at Ogilvy & Mather Advertising, London, recently told us in another interview. “The SMEs we work with tend to put aside a small ‘slush fund’ of media spend to work into their social channels as when these opportunities arise. Definitely worth doing.”

    Here’s more on how SMBs can deal with Facebook’s recent News Feed changes.

    Image via BIA/Kelsey

  • Report: Big-Spending SMBs Prioritize Search

    Search engine marketing is the top digital marketing priority for most higher-spending small and medium-sized businesses, according to anew report from BIA/Kelsey. These are businesses spending over $25,000 a year on advertising and promotion. On average, they’re spending $79,000.

    60.6% rated search advertising and marketing (including SEO) as an “extremely high” or “very high” priority for the coming twelve months. 20.7% reported using PPC advertising in the previous 12 months, compared to 19.6% in 2013.

    “The LCM [Local Commerce Monitor – the study] findings indicate small businesses want to improve on the ability for consumers to discover them,” said Steve Marshall, director of research, at BIA/Kelsey. “SEM, SEO, and pay per click are fundamental to achieving this goal, particularly with the growth of mobile search.”

    According to the firm, local search revenues are expected to reach $7.2 billion in 2015, which would be up from $7.1 billion this year. It maintains that local mobile search will account for 51.1% of mobile ad spending in 2015.

    The LCM recently found that small businesses spend more on social media than any other media category with Facebook dominating at 55.1% of SMBs reporting they have Pages.

    BIA/Kelsey will release additional findings at an upcoming local media conference in December.

    Image via BIA/Kelsey

  • Report: SMB Local Media Spending To Surpass $50B Next Year

    BIA/Kelsey is estimating that spending on local media by SMBs will reach $50.4 billion in 2015 at 35.8% of total local media spending. SMBs, it says, will allocate $37.7 billion of their local media spend to traditional media and $12.4 billion to digital.

    According to the firm, national brands will spend $50.5 billion on local media in 2015, and will make up 35.9% of total local media spending. An additional $39.8 billion in local media spending will come from local brands that aren’t SMBs, it says.

    SMBs, national brands, and non-SMB local businesses will each increase their local media spend by double-digit percentages, the report says.

    BIA/Kelsey intends to present its findings later this month, offering the full edition of its forecast, which will cover twelve media segments, including: newspapers, radio, over-the-air TV, cable TV, out-of-home, direct mail, directories, magazines, online, mobile and social.

    It will issue the forecast on the first day of the Leading in Local: SMB Digital Marketing conference, which starts on September 22nd. The timing for the annual forecast has been moved from the spring to the fall.

    Image via PR Newswire

  • BIA/Kelsey: U.S. Social Ad Revenues To Hit $15B In 2018

    BIA/Kelsey released its latest U.S. Social Local Media Forecast looking at 2013 – 2018. The firm expects social media ad revenues in the country to grow from $5.1 billion in 2013 to $15 billion in 2018. This would represent a compound annual growth rate of 24%.

    According to the report, 2014 is seeing the greatest year-over-year increase in social media ad revenues with a projected $8.4 billion. The firm chalks this up to increases in mobile and native advertising spend.

    Social display ad revenues are expected to grow from $3.3 billion in 2013 to $5.6 billion in 2018 while native social advertising is expected to grow from $1.8 billion in 2013 to a whopping $9.4 billion in 2018 largely thanks to Facebook’s News Feed ads and Twitter’s promoted tweets. The firm expects native social advertising to eclipse social display for the first time next year.

    “We were initially skeptical about the social-mobile market’s ability to capture optimal wallet share because of mobile’s limitations, such as smaller screen size, limited ad inventory and static creative,” said Jed Williams, VP, consulting at BIA/Kelsey. “Over the past year, however, Facebook, Twitter and other networks have generated dramatic revenue growth, primarily as a function of mobile ad acceleration and largely through natively integrated mobile ad formats. We expect this growth to continue throughout the forecast period.”

    “While social networks are enhancing the geotargeting capabilities of their ad platforms, local targeting is still an emerging capability,” said Williams. “As social usage further migrates to mobile platforms, the need for locally targeted messages and offers that leverage mobile’s unique capabilities will expand. We expect social local ad spend to increase steadily through 2018, as SMBs better leverage multi- and micro-targeting to optimize campaigns, and national brands drive more traffic to individual store locations and target consumers with more personalized offers.”

    The firm expects locally targeted advertising in the U.S. to grow from $1.3 billion in 2013 to $5.2 billion in 2018.

    Image via PR Newswire

  • Mobile Local Ad Revenue Expected To Triple Over Next Five Years

    Mobile local ad revenues in the U.S. are expected to hit $4.5 billion this year, according to a new report from BIA/Kelsey. That would be a massive increase over last year, which saw $2.9 billion.

    And that’s really just the beginning. The firm is projecting mobile local ad revenues to more than triple over the next five years, reaching as high as $15.7 billion in 2018.

    It expects mobile ad spending in general in the U.S. to reach $11.4 billion in 2014 and $30.3 billion in 2018. By the end of that year, it says, locally targeted mobile ads will be 52% of overall mobile ad spending in the U.S.

    “Advertiser demand will be driven by natural market forces to follow undervalued inventory,” said Michael Boland, senior analyst and VP of content at BIA/Kelsey. “Mobile advertising’s appeal includes higher performance, clearer ROI, tangible conversions and a shorter purchase funnel. These qualities of mobile content and advertising present a rare alignment between typical mobile user intent and advertisers’ stated objectives.”

    Tactics like geo-fencing, click-to-call, and click-to-map are helping drive up spend on mobile local advertising, according to the firm.

    BIA/Kelsey expects mobile search ad revenues to grow from $4.3 billion in 2014 to $10.9 billion in 2018, native social ad revenue to grow from $3.3 billion in 2014 to $9.9 billion in 2018, mobile display (app and mobile web) ad revenue to grow from $2.4 billion in 2014 to $6.1 billion in 2018, mobile video ad revenue to grow from $1.1 billion in 2014 to $3.1 billion in 2018, and SMS ad revenue to grow from $332 million in 2014 to $381 million in 2018.

    Image via BIA/Kelsey

  • Political Ad Transparency: Should There Be More?

    Political Ad Transparency: Should There Be More?

    With political ads in full swing during this election year, a debate is heating up in Washington over a proposal from the FCC that would impose regulation on TV stations. The Commission wants TV stations to put the “public inspection files,” which include the names, costs, and running dates of every political ad in recent years on a website that it would oversee.

    Although this information is already available to anyone who wants to physically go to a television station and access the files, the FCC has said the move is part of its bigger effort to transition from paper to digital across the board. It also believes that more transparency is necessary in political advertising.

    Would you like to see more transparency in political ads? If so, what are the benefits? Please share.

    Political ad campaigns have become particularly controversial of late as financial issues continue to plague the country.

    Mark Fratrik, Vice President and Chief Economist at BIA/Kelsey “With the tremendous amount of political advertising that’s being spent already in the Presidential campaign and many other local campaigns, there’s a concern about who’s paying for it all and whether or not there are some interests that are spending an excessive amount of money,” Mark Fratrik, the Vice President and Chief Economist at BIA/Kelsey, told WebProNews.

    In spite of these financial concerns, television stations are against the regulation due to concerns of their own. As Fratrik explained to us, they are not opposed to the digital database specifically, but they are instead worried about the additional burden on them.

    “[TV stations] are a little concerned about the logistics of it, [and] the amount of additional man-hours that each station would have to incur to respond to these proposed regulations,” he said.

    TV broadcasters are also speaking out against the proposal since radio stations were not included. But, according to Fratrik, the vast majority of revenue from political advertising campaigns goes to TV stations. In fact, campaign spending on local TV stations is expected to reach near $3 billion this year. Although radio stations bring in some revenue through political campaigns, Fratrik said it pales in comparison to the amount that TV stations produce. Therefore, the FCC didn’t feel it was necessary to include radio stations in the proposal.

    Another concern that TV broadcasters have is the impact the regulation would have on pricing. They fear that once the prices are made readily available, the competitive marketplace will decrease. This fear is magnified since political campaigns have the privilege of receiving the lowest costs possible for spots.

    “They’re concerned about the lowest prices being out there and that other advertisers will start demanding them,” said Fratrik.

    Various broadcasters have voiced their opposition on this aspect, especially since practices may vary from station to station. In a complaint filed from Allbritton Communications, which owns ABC-affiliated stations in 6 markets, Jerald Fritz, the Senior Vice President, said that the online database would “ultimately lead to a Soviet-style standardization of the way advertising should be sold as determined by the government.”

    Furthermore, many of those in opposition have questioned the FCC’s authority in this matter, since campaign finance does not fall into the realm of its governance. However, some have suggested that the Commission is being forced to step in by way of the media since the Federal Election Commission has fallen short.

    Commissioner Robert McDowell, who is the sole Republican at the FCC, sides with the TV stations in this debate and has called the proposal a “jobs destroyer.” Last week, at a House Appropriations Subcommittee meeting over the matter, he pointed out the harmful impact the regulation could have.

    “While the original goal of such disclosure may have been to create more transparency in the political spending process, the unintended consequence could be to encourage price signaling and other anti-competitive conduct by broadcasters that could produce harmful market distortions,” McDowell said.

    Since neither side appears to be backing down from its stance, Fratrik told us it was not likely that the mandate would be approved this year. What’s more, if the administration changes after the election in November, he believes it could impact everything.

    Which side of this debate do you take: the FCC or TV stations? Let us know.

  • Local Online Ad Revenue To Top $42 Billion

    Local Online Ad Revenue To Top $42 Billion

    Online/interactive advertising revenue is forecast to reach $42.5 billion by 2015, nearly double 2010’s $21.7 billion, representing a compound annual growth rate (CAGR) of 14.4 percent, according to a new report from BIA/Kelsey.

    This growth is tied to anticipated improvement in the U.S. economy and a continued increase in overall local advertising, which is expected to reach $153.5 billion in 2015, up from $136.3 billion in 2010, representing a 2.1 percent CAGR.
    BIA-Kelsey
    As digital media — delivered to consumers through mobile, Internet or other electronic methods — continues to gain traction with local advertisers, BIA/Kelsey predicts it will represent 23.6 percent of all local ad spending by 2015.

    “As the business climate improves and advertisers step back into the market, they are gravitating to digital options that perhaps were not as mature before the recession began,” said Tom Buono, chief executive officer, BIA/Kelsey.

    “Our analysis indicates that as advertisers move to online, mobile and, particularly, the variants of social media, we are fast approaching a tipping point where digital media will soon become a dominant segment of the local advertising marketplace.”

    Other highlights from the report include:

    *The increased number of smartphones and tablets is already playing a role in affecting revenue shares earned by traditional media.

    *Continued significant newspaper revenue erosion will drive pay walls and other creative approaches for rebuilding revenue base.

    *The interactive/online sector continues to advance and multiply with new formats such as social and mobile.

    The report also found that social media is increasingly becoming an important part of online revenue. Consumer spending on deal-a-day offers, which the firm expects will grow to $3.9 billion by 2015, illustrates an expanding market that includes Facebook and Twitter.

    “What we’re seeing in terms of media share shifts and transformation is really unprecedented,” said Neal Polachek, president, BIA/Kelsey.

    “As we look forward, the core issue challenging advertisers is to figure out a media plan that leverages the transactional nature of digital media with the scale and reach of traditional media.”

  • Groupon Like Daily Deal spending Could Top $6 Billion

    U.S. consumer spending  on daily deal sites like Groupon and LivingSocial is on track to grow from $873 million in 2010 to $3.9 billion in 2015, representing a 35 percent growth rate, according to a new report from BIA/Kelsey.

    BIA/Kelsey indicates a number of variables will have an impact on the development of deal a day, such as growth in the number of cities/sites, registered users, transactions per year for the average user and the average price per transaction. Including those variables, deal a day could grow as much as $6.1 billion by 2015, while a conservative estimate is $2.1 billion.

    Deal-a-Day

    "Deal a day has experienced incredible growth during its three-year incubation period beginning in 2008," said Mark Fratrik, vice president, BIA/Kelsey.

    "We expect this to continue as companies in the space are rapidly adding markets and increasing total user count. They are also subdividing existing metros to provide deals closer to where users live, which we believe will help offset any drop-off that may occur due to consumer fatigue as the novelty of the form fades."

    While Groupon and LivingSocial are tops in a marketplace of more than 200 similar services, the broader area includes sites working with local media providers such as directory companies, newspapers and radio and television stations. BIA/Kelsey estimates there are 178 cities with deal-a-day sites reaching 102 million people in the United States.

    "The combination of fun offers and convenience makes deal a day a very attractive way to reach local users, and for publishers to work with small businesses," said Peter Krasilovsky, vice president and program director, Marketplaces, BIA/Kelsey.

    "We expect to see some shift in local media spending resulting from the adoption of deal a day by local advertisers. We also believe that deal a day doesn’t exist in a vacuum. It will become a part of the growing deals and offers landscape."

     

  • Online Media Key For Local Consumers

    Nearly all consumers (97%) now use online media when researching products or services locally, according to a new report from BIA/Kelsey and ConStat.

    Among consumers surveyed, 90 percent use search engines, 48 percent use Internet Yellow Pages, 24 percent use vertical sites, and 42 percent use comparison shopping sites.

    Steve-Marshall "The Internet has indeed become an integral part of consumers’ local commercial activity," said Steve Marshall, director of research, BIA/Kelsey.

    "The data suggest we’re at an inflection point where the balance of power in local shopping is shifting to online."

    The study found on average, consumers are using 7.9 different media sources when shopping for products or services locally, up from 6.5 sources in 2009 and 5.8 in 2008, indicating an increase in audience fragmentation.

    Additional finding include:

       * 58 percent of respondents report using an online coupon when shopping for products or services in their local area in the past year.
       

     * 19 percent of respondents made an appointment online in the past six months for a service besides a restaurant reservation (e.g., business appointment, health-care appointment, auto service or personal service).

    "The increase in audience fragmentation presents challenges for advertisers looking to connect with local consumers," said Peter Krasilovsky, vice president and program director, Marketplaces, BIA/Kelsey.

    "These challenges may be outweighed by the targeting opportunities available with tools like coupon promotions and appointment scheduling, the latter being among the best lead sources possible, since you know where people are actually going."