Pureplays now get 57.3% of LOCAL online ad spend

New research just out from Borrell Associates shows the continuing growth and dominance of local online spending by internet pureplay companies (like Google, Yahoo, etc.).
pureplays now get 57% of local online ad dollars

I’ve not seen the report yet, but here are a few lines from the press release:

The Pac-Man affect continues, with Internet pure-plays continuing to gobble share at the expense of print media, particularly Yellow Pages and newspaper publishers.

Meanwhile, the growth in local online advertising continues to outpace even the most optimistic expectations. We are projecting 50 percent growth this year — phenomenal, considering the sharp decline in retail sales. The recession appears to be an economic prod that is motivating the smaller local advertisers to abandon long-time spending patterns and seek out the most economical methods of reaching potential customers.

The pureplay companies are the real enemy of local media, because it’s all about ad dollars. Most companies don’t see this as priority number one, and I only hope they can get there before it’s too late.

MORE from the executive summary:

We expect local online advertising to reach $13.1 billion in 2008, up slightly from our initial forecast last December.

Part of the growth is being driven by traditional local media companies selling advertising on their own sites. Most of it, however, comes from pure-play companies delivering lowercost advertising that intercepts consumers not as they are reading news online, but as they are using the Web to research products and prices. The recession is an economic prod that is motivating advertisers to abandon their long-time spending patterns and seek out more economical methods of reaching potential customers.

Borrell predicts the growth will slow after another 18-month period of double digit upside. Indeed.

Comments

  1. The most interesting takeaway for me was that Burrell also noted most successful local news outlets have designs and operations that increasingly less to do with the traditional media outlets that spawned them. In previous years, it was easy to determine if a web site was associated with a TV station or newspaper simply by looking at the design. That’s no longer the case–at least with the most successful of the breed.

    I wonder what that means for TV stations that continue to run their web sites as if they are an extension of the broadcast product?

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