$1 Billion in Local Ad Spending Up for Grabs, Is CTV the Answer?
Rick Ducey, BIA Advisory Services
BIA estimates that this translates to more than $1 billion that would have gone to Facebook ads in 2022 that will now be spent somewhere else. This creates a sizeable opportunity for local media platforms.
Estimates vary, but as many as 80 percent of iOS users (iPhones, iPads) have not opted-in and thus without being tracked they become much less targetable by advertisers used to granular audience segments defined in Meta’s ad platforms Facebook and Instagram. That makes advertising less efficient and more expensive to acquire new business.
A recent Wall Street Journal article (and podcast), Facebook’s $10 Billion Exodus, provided an insightful case study of a small business owner who used Facebook ads and paid in the range of $4 – $14 per customer acquired. This was very cost effective. However, the impact of Apple’s ATT policy meant essentially that 80 percent of Facebook impressions had less user data for targeting. Rather than delivering ads to a focused audience segment, ads were delivered with more waste to a broader Facebook user base. This drove the customer acquisition cost to well over $100. In this case study, the small business shifted ad spend from Facebook to Google.
It is case studies like this that demonstrate why there is over $1 billion in play from businesses looking for alternatives to advertising to reach local audiences in Facebook ads. This is a powerful time for local publishers to develop tactics for addressing this sizeable market opportunity.
To compete for this opportunity, local media sellers can review the offers they can make to local businesses to give them a new home for what they had been spending in Facebook and Instagram ads. One of the fastest growing local ad platforms that offers excellent targetability and attribution is Connected TV. BIA forecasts CTV local ad spending to exceed $2.2 billion in 2022. CTV is a powerful local ad platform for addressing marketer’s needs to reach specific audience segments and show ROI, including cost per acquisition. Converting Facebook’s lost dollars to local CTV dollars is an opportunity that is immediately available in the market.
To learn more about local CTV, we invite you to download BIA’s white paper for Premion, A Marketer’s Guide: The New Rules Ahead for Streaming TV Advertising to learn more about the dynamics, size, and trends of the local CTV market space.