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BIA/Kelsey Forecasts U.S. Social Ad Revenues To Reach $11B In 2017

CHANTILLY, Va., April 10, 2013 /PRNewswire/ --  BIA/Kelsey, advisor to companies in the local media industry, forecasts U.S. social advertising revenues to grow from $4.7 billion in 2012 to $11 billion in 2017, representing a compound annual growth rate (CAGR) of 18.6 percent.

(Logo: http://photos.prnewswire.com/prnh/20110616/NE20926LOGO )

BIA/Kelsey expects social advertising's local penetration to steadily increase as social networks continually improve the ease of onboarding, local targeting and campaign management for both brands and SMBs. Locally targeted social ad revenues will grow at a 26.4 percent CAGR, from $1.1 billion in 2012 to $3.6 billion in 2017.

"Social networks are evolving their ad products and features to improve performance," said Jed Williams, director of consulting and senior analyst, BIA/Kelsey. "Native social formats, including video, and mobile-social advertising will be the principal market growth drivers."

According to the forecast, display remains the dominant social ad unit, although native ad formats such as Facebook's Sponsored Stories and Twitter's Promoted Tweets require re-thinking of traditional display to optimize social campaigns, especially on mobile platforms. BIA/Kelsey forecasts U.S. native social advertising revenues to grow from $1.6 billion in 2012 to $4.6 billion in 2017 (CAGR: 22.9 percent).

Also driven by Facebook and Twitter, U.S. social mobile ad revenues approached $600 million in 2012, and are expected to grow to $2.2 billion by 2017 (CAGR: 29.9 percent).

BIA/Kelsey custom advisory service clients can log into the client resource center to download the full U.S. Social Local Media forecast.

Forecast Methodology and DefinitionsBIA/Kelsey defines the local media advertising marketplace as those media that provide local audiences to all types of advertisers.

BIA/Kelsey defines social media advertising as money spent on advertising formats across social networks. Currently the predominant ad format is display, though native advertising formats are emerging as display alternatives. Social advertising is included in BIA/Kelsey's display revenue forecast, which falls within the online/interactive advertising category. BIA/Kelsey specifically delineates native social advertising, which the firm defines as branded content integrated directly within a social network experience (i.e., the newsfeed or content stream). These integrated, advertorial qualities differentiate native ads from traditional display. BIA/Kelsey's definition of social advertising does not include revenues derived from virtual currency; social marketing/measurement platforms and services; or social commerce.

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