BIA Advisory Services has slashed its 2025 U.S. local advertising forecast by over $2 billion, citing weak economic conditions and declining confidence in traditional media. Total local ad revenue, including political, is now expected to reach $169 billion, down 2.4% year-over-year. Without political ads, revenue will total $168.2 billion—still a 3.7% improvement over 2024 but below the $171 billion forecast made in March.
The new figures reverse BIA’s earlier modest optimism. In March, it had projected a 6.1% increase over 2024 and a slight boost to political and non-political categories due to anticipated digital growth. However, rising tariffs, interest rates, and tighter credit markets have led businesses to reallocate spending more cautiously. “Ad growth has slowed down slightly,” said BIA’s VP of Forecasting and Data Analysis Senan Mele.
In March, radio revenue (combined over-the-air and digital) was forecast to fall 4.9% year-over-year when including political dollars, and 0.8% without. Over-the-air radio was projected to drop 6%, with digital radio inching up 0.1%. The August update doesn’t provide a detailed radio breakdown but cuts $3.5 billion from traditional media, suggesting steeper declines ahead.
Digital media, by contrast, gained a $855 million upward revision, now projected to account for 53.7% of all local ad spend or $90.4 billion. Connected TV and OTT platforms lead digital’s growth at 29.3%. Digital radio may benefit from the shift, though not enough to offset traditional losses.
Top ad growth categories have shifted since March. Real Estate has accelerated from +9.3% to +10.4%, while Restaurants cooled slightly from +9.2% to +7.8%. Finance & Insurance, up 4.0%, has replaced Retail in the top three. Meanwhile, Media (-2.2%), Healthcare (-0.5%), and General Services (-0.3%) are forecast to shrink.
Mele emphasized opportunity remains, particularly as holiday spending begins earlier.