Borrell Associates conducted a report showing all local online video advertising will account for 371 million dollars this year, totaling five percent of online ad spending. “The New Frontier: Local Online Video Advertising” report estimates in 2012 that amount will go up to 5 billion dollars and account for 35%. Competition among newspapers and TV stations encourage the growth. Another factor relates to the reasonably priced online advertising versus TV advertising. Borrell Senior Vice President Peter Conti explains why he thinks online advertising thrives.
“These are the people who can’t afford TV advertising. It’s that kind of video and that kind of marketing that they’ve never been able to do or afford before, and it’s affordable on a much more effective and efficient medium.”
Conti considers the growth in local video comes at the cost of banners and classified ads. Conti believes local advertisers will target video ads because they have not had the power to do so offline. The report states that newspapers lead local online video advertising at 81 million dollars over TV broadcasters at 32 million dollars.