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Local Mobile Ad Spending to Continue Dramatic Growth

Local mobile spend to surpass $2 billion by 2014

US local mobile ad revenues are set to increase at a compound annual growth rate (CAGR) of 57% from 2009 through 2014, according to a forecast by BIA/Kelsey.

Local spending on the mobile channel is set to rise from $404 million this year to $692 million in 2011 and over $2 billion by 2014, the firm projects.

“We expect to see more bundling of mobile advertising by digital and local media companies, in an effort to lower the barriers for adoption by small and medium-sized businesses,” said Michael Boland, program director at BIA/Kelsey, in statement. “As a result, mobile advertising will move down market to SMB and mid-market segments, increasing the overall revenue opportunity and share of geotargeted ads. This down-market shift will be coupled with large advertiser evolution and adoption of mobile local ad distribution.”

Overall, BIA/Kelsey forecasts mobile ad revenues to increase from $790 million this year to just under $3 billion in 2014, making local an increasingly prominent part of the mix. In terms of formats, the firm expects a shift in favor of search over the same period.

eMarketer estimates a similar $743.1 million in mobile spending this year, rising to a somewhat more conservative $2.55 billion in 2014. Display will remain the dominant format, however, with search approaching but not surpassing it, according to eMarketer’s forecast.

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Check out today’s other article, “Display Spending Begins to Catch Up with Search.”

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