Search marketing is a huge aspect of local SEO, but it's not the only component to a successful local marketing strategy. More and more, social media is playing a big role in local search marketing thanks to its ability to further connect local businesses and their customers and place the business in high-visibility areas for targeted ads. New research shows that not only will local spending on social media ads rise in the next five years, but so too will revenues derived from social media.
According to BIA/Kelsey, local media consultant, U.S. social media ad revenues will rise to $9.2 billion in 2016, double that of revenues in 2012, which reached $4.6 billion. The compound annual growth rate (CAGR) of the increase will total 19.2 percent, a notable rise in revenue. More important for local businesses is the rise in the local segment of U.S. social media advertising spending which will increase from $1.1 billion in 2012 to nearly $3 billion in 2016, a CAGR of 28 percent.
"The year 2012 can be viewed as social advertising’s ‘coming of age,’” said Jed Williams, program director of social local media for BIA/Kelsey. "The continued development of native ads, such as Facebook's sponsored stories and Twitter's promoted tweets, and the acceleration of mobile monetization will be the primary drivers of social advertising growth through 2016."
The new forecasts on local social media is in line with a previous BIA/Kelsey monitor that showed a definite trend in the growth of local mobile search advertising. Projected mobile local advertising will grow from $664 million in 2011 to $5.8 billion in 2016, a CAGR of 54.2 percent. Search was the largest driver of the mobile local revenue increase, as it is projected to grow from $390 million in 2011 to $3.2 billion in 2016, a CAGR of 52 percent. Mobile social media was also a large component in the latest monitor, BIA/Kelsey estimates social-mobile ad revenues will rise to $15. billion by 2016, up from $500 million in 2012.
Overall, spending on social display ads - including advertising in Facebook's Marketplace or YouTube's video banners - will increase from $3 billion in 2012 to $5.4 billion in 2016. Spending on native social ads, including newsfeeds and content streams, will grow from $1.5 billion in 2012 to $3.9 billion in 2016.