Jupiter: Online Local Ads to Hit $3.2B This Year

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A new report from JupiterResearch claims U.S. spending for online local advertising will grow 26 percent this year to $3.2 billion, topping $5.3 billion in 2010 with 11 percent annual compounded growth.

Classifieds will account for about 70 percent of those projections throughout the forecast period, the New York market researcher said in its "U.S. Local Online Advertising Forecast, 2005 to 2010" report.

"Outside of classifieds, local ad spending online remains relatively immature," David Card, JupiterResearch vice president and senior analyst, said in a statement. "For now, online publishers and networks will find better opportunities servicing national advertisers that are aiming at local audiences than they will servicing true local businesses."

Local spending last year drove only 5 percent of online display advertising and 16 percent of paid search listings. The report claims that selling online display or search ads to local businesses will be a tough call.

"Local, service-based companies will lead the second wave of online local spending," JupiterResearch senior analyst Gary Stein said in the statement. "But only if they are offered ad models that make sense for them. Pay-per-click doesn't make a lot of sense if you don't value your site as a source of leads. Pay-per-call technologies have promise, but face uncertain growth."

Mickey Alam Khan covers Internet marketing campaigns and e-commerce, agency news as well as circulation for DM News and DMNews.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters


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