Currently, small businesses and national corporations alike are challenged by advertising at the local level – as evidenced by a recent study from the Chief Marketing Officer Council.
But a separate report from BIA/Kelsey suggests that geotargeted social media marketing projects will be gaining popularity and pulling a larger proportion of ad budgets in the coming years. In 2010, companies spent $400 million on local segments of social media advertising, but that amount is set to increase at a compound annual growth rate of 33.3 percent in the coming years.
“To date, local targeting has not been widely adopted by SMBs or national brands,” said Jed Williams, analyst and program director of BIA/Kelsey’s Social Local Media practice. “However, the paradigm is moving to performance, with Facebook and other networks focused on improving format, creative and targeting to boost rates and drive deeper ad engagement.”
Williams added that the research suggests small businesses will get a better understanding of the social networks’ targeting features, and as a result, social local ads will continue at a steady upward trajectory through 2015. Total social ad revenues will jump from the $2.1 billion spent in 2010 and grow at a CAGR of 25.7 percent, reaching $8.3 billion in 2015, the company said.