Note:  This post originally appeared on the old Balihoo blog on 11/24/09 by Marcie Blagden

It’s no big secret that 2009 has been dismal for those in the advertising industry. With that said, local advertising is expected to end 2009 with a 12% increase over 2008 (according to a five-year forecast from Borrell Associates). Despite this growth, Borrell predicts that things will get tougher in 2010, when local online sales see just a 5% growth over 2009 figures.   

This slowdown is predicted to occur because the market is approaching saturation and the “wave many locally focused media companies have been riding for the past several years has peaked.” 

This report also indicates that the next waves of growth in the local advertising online industry will be seen in online promotions and mobile advertising. 

The Borrell Associates report reveals that while mobile is not likely to play a huge role (the firm estimates that local buys will comprise only 20% of all mobile advertising) it is a category worth keeping an eye on because of the numerous viable applications it could potentially provide local marketers (couponing, mobile directory advertising, sponsored text messages, etc.).

With companies such as PBS, ESPN, AOL, Huffington Post, The Knot, Microsoft, Yahoo and numerous others reportedly planning to immerse themselves in local ad sales the local game in 2010 could really heat up. In regard to online promotions, smaller locally focused companies will likely follow a few years behind the spending patterns of national advertisers by expanding their use of online promotions. This change will likely give smaller companies (with presumably smaller budgets) greater direct access to their customers -which could potentially reduce their reliance on media companies and help them spread their marketing budgets to more successfully and frequently reach their local advertising customers.  Local media buying clearly is changing.