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Location-Targeted Mobile Ad Spend to Reach $29.5B in the U.S. in 2020

Jun 16, 2016

Native social advertising will represent more than one-quarter (28.1%) of U.S. local-targeted ad spend by 2020, pulling market share from search and display.

CHANTILLY, Va. (June 16, 2016) – In the spring update to its U.S. Local Advertising Forecast 2016, BIA/Kelsey projects location-targeted mobile ad spending to grow from $9.8 billion in 2015 to $29.5 billion in 2020, a 24.6 percent compound annual growth rate.

The forecast offers breakouts of ad spend for search, traditional display, native social, traditional video, and messaging. Search will continue to eclipse all ad formats, holding the largest share of location-targeted ad spend through the forecast period. However, that share will decrease from 57 percent in 2016 to 42 percent in 2020.

“Several market factors are currently bearing down on the mobile ad marketplace—from Google’s moves to adapt to an app-based world, to the media consumption habits of millennials,” said Michael Boland, chief analyst and VP, content, BIA/Kelsey. “These and other influences will require advertisers, publishers, agencies and ad tech players to rapidly innovate.”

Location-Targeted Mobile Ad Spend

BIA/Kelsey expects native social, one of the fastest growing formats in mobile advertising, to increase its share of location-targeted mobile ad spend from 19.8 percent in 2016 to 28.1 percent in 2020, mainly at the expense of search and display. The most common examples of the native social format are Facebook’s news feed ads and Snapchat Stories. Instagram and LinkedIn have similar offerings, which continue to grow in prevalence and ad coverage.

The forecast points to a number of factors feeding native social’s expected growth including:

  • The rise of ad blocking technology which will benefit formats that are immune to ad blockers, like native social and sponsored content.
  • High performance of native social compared with other mobile ad formats and benchmarks.
  • Alignment with mobile device realities, like small screens, which favor vertically scrolling in-feed units over banners.
  • Growing consumer influence and buying empowerment of millennials, who are more receptive to native social advertising than traditional formats like banners.
  • Continued evolution of in-feed ad units, like action buttons and multimedia.

BIA/Kelsey defines location-targeted mobile advertising as advertising that is based on a user’s location or includes proximity-relevant content to trigger local offline conversions. It includes large national advertisers, SMBs and local advertisers that are not SMBs. Location-specific ad copy or calls to action (e.g., call local store) will classify a given ad as location targeted.

The mobile forecast is part of BIA/Kelsey’s U.S. Local Advertising Forecast 2016, a five-year forecast that delivers a national overview of total U.S. spending in local markets. In addition to mobile, the forecast includes individual media breakouts for direct mail, local video, local over-the-air television, local cable television, out-of-home/OOH video, newspaper, online, radio, directories, social and local magazines.

To order a copy of the BIA/Kelsey U.S. Local Advertising Forecast 2016 – Spring Update, click to purchase. The Mobile forecast is also available as a standalone forecast upon request. For more information, email or to request a briefing, click now.

About BIA/Kelsey

BIA/Kelsey (@BIAKelsey) defines, organizes and analyzes the multibillion-dollar Local Commerce Universe (LCU) for media, technology companies, brands and agencies competing in today’s multiplatform, interactive local media and marketing arena. LCU, the firm’s proprietary vision for tracking the evolving local marketplace, provides an effective framework for delivering meaningful data-driven analysis, consulting and valuation services, competitive intelligence and state-of-the-industry conferences. Learn more about BIA/Kelsey at

For more information contact:
Eileen Pacheco
For BIA/Kelsey
(508) 254-1440