Two-Thirds of Marketing Budgets Go to Local Advertising, Across All Sizes of Businesses, According To BIA Advisory Services' SAM

SAM Suvey

BIA ADVISORY SERVICES’ newly released 2018 Survey Of Advertising And Marketing (SAM) activities of U.S. businesses indicates that they direct almost two-thirds of their marketing dollars into activating local media ad platforms and the remainder into promotions. For businesses with 500 or more employees, this spending averages $4.48 million for advertising and $2.18 million on promotions. The 2018 U.S. SAM survey uses a sample of 1,500 businesses of all sizes doing local advertising and promotions, including local, regional, and national businesses for insights into historical and intended marketing practices.

"The significance and strength of local is revealed in the finding that overall U.S. businesses invest about two-thirds of their total marketing budgets (promotions plus advertising spending) in advertising on local media ad channels," said BIA VP/Analysis and Insights and SAM Study Director CELINE MATTHIESSEN. "Those businesses in the top category, (500 more employees) had average total marketing (advertising plus promotions) budgets of $6.66 million, of which 67.3 percent ($4.48 million) was spent in the past 12 months on advertising. Businesses in the next category, 100-499 employees, spent an average of $259,000 in their total marketing budget, of which 61.5 percent was spent on advertising."

The top five media for advertising and promotion include targeted social ads, email, direct mail, direct home and mobile location aware. With each offer hyper-audience targeting, three major trends are decisively apparent: 

• Social ad channels are popular for reaching targeted audience segment. Nearly two-thirds (61.2%) of businesses advertising in local market use "Targeted Social Ads" as part of their media mix. 
• Each of the top five media channels offer deep targeting, whether individual targeting as with email (49.3% usage) and direct mail (37.6% usage), or with household targeting with "Direct Home" (35.7% usage) media like door hangers. 
• The prominence of a mobile ad channel, "Mobile Location Aware" (35.5% usage), does audience targeting based on geofencing or geotargeting.

"As businesses continue their push to target local consumers, the media that delivers deep analytics to them will be the preferred choice for businesses’ advertising and marketing dollars," said MATTHIESSEN.

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