This State of the Industry report, sponsored by Locality, dives into how brands, agencies and media buyers are engaging with local advertising across CTV, streaming and broadcast TV, and how their allocations have shifted.
Continual audience and media fragmentation have led brands and agencies to seek more efficient ways to reach their target audiences. One approach is local advertising, which allows marketing teams to utilize targeted planning, buying, messaging and measuring strategies for engagement and flexibility. While personalization has been an advertising strategy for years, local advertising tactics focus on geographical factors when forming specific messaging to establish a sense of community for audiences.
However, as budgets shift and channels and consumer behaviors evolve, how teams utilize local advertising strategies has also evolved.
In this new State of the Industry report, Digiday and Locality surveyed 94 brands, agencies and media buyers to explore how they engage with local advertising — especially across CTV, streaming and broadcast TV — and how their allocations have shifted. This report examines how advertisers’ local advertising strategies, channels and messaging compare to their national advertising tactics and how they’re finding success.
- As advertisers recognize local advertising strategies’ value and cost savings, they’re tying national and local advertising closely together.
- Eighty-three percent of brands, agencies and media buyers expect to allocate more than 20% of their overall marketing budget to local efforts in 2025 — up from just 46% in 2024.
- With this shift, four of the top reasons respondents are leveraging local advertising strategies are targeted audience reach, increased foot traffic, more relevant messaging to specific locations and improved customer relationships.
- With ad tech innovations and advancements in AI, advertisers can more easily (and affordably) augment national video creative with personalized, local messages that resonate with the audience at a level not previously done across streaming or broadcast.
In 2024, 51% of respondents attribute 20% or less of their company’s annual revenue to their local advertising efforts. However, looking ahead to 2025, those expectations significantly shift. Eighty-one percent of respondents anticipate attributing more than 20% of their annual revenue to local advertising, a substantial increase from less than half (49%) in 2024. This demonstrates a strong trend, as most brand and agency decision-makers surveyed predict local advertising will contribute a larger share of their revenue in 2025 than this year.
Nearly three-quarters (71%) attribute 1%–40% of this year’s national advertising efforts to their annual revenue, while next year that shifts to 21%–60%, with 70% in that range.
Respondents are also planning to increase their investments in local advertising for 2025. A significant 83% of respondents expect to allocate more than 20% of their overall marketing budget to local efforts, compared to just 46% in 2024.
Determining budget allocations can be challenging, especially when venturing into a new geographic area, channel or strategy. While exact allocation depends on each specific goal, understanding the scope and impact of local advertising can help inform budgeting decisions.
“It depends on the advertiser and their competitive set,” said Ann Hailer, president of broadcast at Locality. “All purchase decisions are made locally, whether from a national or a local brand, thus, every brand’s advertising spend should start with a local strategy.”
Marketers now also have access to very granular market data that can provide intelligence on where local ad spend can create better engagement with audiences and lead to a greater ROI.
“It’s important for brands, agencies and advertisers to examine KPIs and align on goals,” said Keith Kazerman, president of streaming at Locality. “Secondarily, aligning on achieving goals with localized budget allocations to support those goals is vital. Local advertising is more authentic as it’s tailored to specific market nuances that drive better engagement with audiences. It’s an advantageous way to gain a greater ROI out of dedicated advertising dollars.”
This year, most (72%) of respondents are allocating 40% or less of their budget to national advertising efforts, but next year, this shifts slightly as 71% allocate 21%–60%.
This could be due to national campaigns often costing a significant amount more than local ones — tens of thousands versus a few hundred to a few thousand dollars for a 30-second ad.
About one-third of our respondents (31%) say their local advertising budgets aren’t changing, but 24% are gaining spend from national advertising budgets and 20% are gaining from another line.
According to our respondents, national and local advertising seem closely tied together. This trend may persist as teams continue recognizing the value of local advertising strategies and their cost savings.
“We’ve seen significant results from brands dedicating more of their budgets to local advertising,” said Hailer. “Local ad spending is proving to be a key growth driver. Among those with significant changes in local advertising budgets, 34% are reallocating funds from national to local and 29% are increasing local budgets from other areas, it’s clear that local advertising delivers tangible value and is becoming a crucial part of marketing strategies.”
As for why our respondents began leveraging local advertising strategies, four reasons stand at the top: targeted audience reach (78%), increased foot traffic (61%), more relevant messaging to specific locations (61%) and improved customer relationships (59%).
Increasing revenue is at the top of every team’s goal set, so it’s no wonder companies are continually adjusting their advertising strategies, including local advertising, for tailored and targeted reach, to drive awareness and increase ROI. Local advertising is more than a mere change of address in an environment — it strengthens relationships and creates community engagement between viewers and brands. This approach enables brands to deliver more targeted messaging that resonates with audiences and enhances sales effectiveness, leading to greater customer loyalty.
An impetus driving local spend is identifying opportunities in performance within local markets via share of voice. Advertisers can use this data to pinpoint a local DMA with a dedicated spend to drive ROI, such as sales, foot traffic or business outcomes. Additionally, advertisers can couple broadcast with streaming in a single DMA for scale and target by zip code, audience and context, further reinforcing positive outcomes and incremental reach.
“The main takeaway for advertisers and brands is that local doesn’t replace a national campaign — it enhances the goals of a national campaign,” Kazerman said. “Reinforcing it with a local approach drives real consumer engagement and behavior in specific geographic areas. A local advertising strategy is complementary to national campaigns, and a variety of additional advertising campaigns.”
The channels our respondents are using most for local advertising are fairly close in percentage: social media advertising (67%), YouTube (65%) and mobile advertising (64%).
While some digital channels dominate here, display ads are tied with radio just below direct mail — an indication that advertisers are emphasizing channels that can more efficiently achieve scale or audience size.
The top channels selected are wide-reaching and relatively easy to implement. Because of this, they’re likely easier for some teams to localize compared to channels with larger start-up costs or ones that are more labor-intensive.
“Historically, localizing content has been complex,” said Kazerman. “However, the advantage of working with companies like ours is that we’re a one-stop shop that brings streaming and broadcast together in a single buy that provides enhanced value and even more reason to lean into local without the operational challenges.”
Taking a closer look at CTV and streaming, the top three strategies respondents are using to localize campaigns across these channels are designated market area or zip code targeting (56%), geofencing and location-based targeting (54%) and dynamic ad insertion (52%).
The primary strategies fall under local audience targeting and delivery through dynamic ad insertions. Secondarily, bespoke creative tactics, such as local influencer collaborations, customizations, interactivity and context (content-relevant) are strategies that over one-third of local advertisers are deploying.
As for the impact of CTV and streaming on local advertising strategies, respondents say programmatic has made targeting local audiences more cost-effective (63%) and that they can use more granular audience segmentation with greater precision (61%).
Respondents are prioritizing targeting capabilities and increased audience engagement through streaming. Notably, 47% of respondents recognize the necessity of incorporating streaming into their local marketing mix.
The top strategies respondents are using across broadcast TV include partnering with local TV stations for co-branded content, sponsored segments or event coverage (54%), local event sponsorships and seasonal advertising (53%) and analyzing local viewing habits for content-relevant ads (48%).
Within broadcast TV, marketers are focused on the advertising content, with 48% of respondents analyzing viewing habits for content-relevant ads. For example, custom ads tailored to local markets (41%), partnering with local stations with co-branded content (54%), crafting brand narratives around local values, identity and history (27%) and collaborating with local influencers (29%) are important strategies broadcast advertisers use to connect with local audiences.
“If you take the broad reach of broadcast in a high-volume market through a trusted local station with trusted brand-safe content, the outcome is a halo effect from the marketers associated with that broadcast messaging,” said Hailer.
“A smart local message takes advantage of premium inventory available on both mediums — broadcast and streaming — and that varies dramatically from market to market,” she continued. “For example, consumption is very different in Seattle versus Miami versus Cincinnati. Working with Locality allows marketers to tailor that approach and have customized plans and content for all markets. The one goal to keep top-of-mind about a local approach is not having a cookie-cutter plan across every market.”
When analyzing how local messaging strategies compare to national ones, 77% of marketers said local strategies have more targeted, personalized messaging versus the generalized messaging of national ones. A large majority say local messaging strategies resonate with communities more (73%), are more cost-efficient (64%) and are more performance-based than national messaging (62%). However, marketers have the perception that local messaging can be complex. Only 14% say local messaging is easily adaptable based on local trends versus the consistent, long-term planning that limits the flexibility of national messaging.
Our respondents view national ads as easier to adapt to markets than local ones, but Kazerman states this is a misconception that needs remedying.
“Ad tech innovations and advancements in AI have made it easier and more affordable to augment national creative with personalized, local messages,” said Kazerman. “Marketers can now produce and deploy hundreds or thousands of versions of locally targeted, data-driven, hyper-personalized ads, down to the zip code level. These local ad messages keep customers engaged and can include brand attributes such as business locations, SKUs, purchase history, weather, loyalty status and more that resonate with the audience at a level not done before on broadcast or streaming. It’s revolutionary.”
When planning messaging strategies — local or national — Kazerman believes the convergence of streaming and broadcast is essential to any campaign.
“From a media consumption standpoint, every market differs and the fragmentation of viewership across platforms is unique,” said Kazerman. “Now that advertisers have access to more data, the percentage of media allocation should be informed by data. By examining the targeted reach of each medium within each market and optimizing delivery accordingly, the more control you have over your local buying, the better. A converged media buy across multiple inventory sources helps.”
Beyond viewership, there are a number of planning factors that vary by market: ad inventory supply, incentives and seasonality, to name a few. Additionally, consumer preferences are distinct by location, Hailer said.
Understanding what each market needs and the brand’s competitive set is crucial to grasping how to target. Having a trusted partner who can provide real-time data and insights impacts an advertiser’s real-time decision-making and budget allocation considerations. Working with a company that has local data intelligence across every market in the country provides advertisers with an informed way of driving local impact. That level of planning drives location-specific results.
When it comes to the measurement of local advertising, the top metric respondents use is local sales (45%), followed by in-store visits (36%), lead generation (26%) and online conversions (25%).
The top two metrics, local sales and in-store visits, reflect why respondents said they began engaging with local advertising strategies — targeted reach and increased foot traffic correlate with local sales and in-store visits, thereby increasing ROI.
Most of our respondents (71%) have seen higher engagement rates from their local advertising campaigns. More than half have also experienced benefits including increased cost efficiency and ROI (59%), increased sales (54%), improved customer loyalty (51%) and increased flexibility (50%).
“Engagement should be the top priority for advertisers,” said Hailer. “Local messages have a stronger resonance with viewers when they connect to the audience’s community. Anytime a marketer can speak to local nuances — whether it’s charity efforts or local sports — you will see higher recall and lift. I would expect respondents to report positive results for localizing content and local brand awareness.”
Kazerman expects marketers to utilize local measurement to identify market-specific opportunities, increasing sales and ROI for incremental value. “Brands will look to drive foot traffic or increase conversions within particular localities that may be underserved by national campaigns,” he said.
The top two challenges for respondents implementing local advertising strategies are nearly tied at 63% and 61%, respectively: resource allocation and local competition.
In this select-all-that-apply category, many of the challenges advertisers face when implementing local buys are operational — localized content creation (32%), managing multiple campaigns (35%) and scaling efforts (45%).
“One of the biggest factors to local advertising that we receive feedback on is the cost of execution from a resources standpoint,” Hailer said. “Buying local can be complex — it’s fragmented, however, that’s also what Locality is great at. We’re working to better service advertisers and agencies that want to engage locally, and we’re able to take on most of the heavy lifting.”
While the prevalence of local competition among brands within local advertising can vary by market, some advertisers may also be unsure of how to position themselves within their market to stand out from the competition.
“A marketer either has a ‘conquest market’ from a competitive standpoint or a ‘protect your market share’ standpoint for their brand, so that plays into the notion that marketing strategies vary by competitor and market needs,” said Hailer. “For example, Walmart is obviously a national brand, and in the Midwest, it has tremendous competition from Meijer, which isn’t a competitor across the entire country. So, Walmart’s approach to conquest Meijer shoppers will be very different in the Midwest compared to a section of the country where Walmart might be one of the only big-box retailers in a given DMA.”
As for how advertisers plan to overcome these challenges, their tactics are rather varied, with leveraging first-party data for improved audience understanding (57%), utilizing AI and machine learning (56%) and developing standardized processes and templates (50%) coming in at the top.
Many of these obstacles, as advertisers see them, speak to solving resource constraints — AI, ML, standardization, automated workflows and modular frameworks, to name a few. Local targeting isn’t a challenge, however, planning to leverage first-party data speaks to opportunities in targeting, measurement and optimization.
As teams work to resolve resource constraints and develop more efficient first-party data strategies, one option many may be considering is whether a partner may be in their best interest.
“The right partnership is key,” said Kazerman. “When advertisers and marketers are considering a partner, the top consideration should be taking the heavy lifting off internal teams — a partner should be a one-stop-shop that can work with you to deliver multiple mediums, with transparency and in a convergent manner. Is that supply premium, and does it deliver the right connection to the consumer that you as an advertiser expect?”
A prospective partner should be able to prove the effectiveness of an ad campaign’s media mix in a given local area and educate and demonstrate the value of local advertising itself. The right partner will also provide specific insights regarding the location of the geography in which the advertiser plans to work.
“We’ve built trust in the advertising marketplace as dependable experts, especially with managed service,” Hailer said. “The benefit of services such as ours means that your specific advertising needs will be met and tailored to your specific goals. We design custom plans hand-in-hand with clients across every market in the country, and this level of trusted partnership is the only way to approach local.”
As brands, agencies and media buyers evaluate their advertising strategies, they continue allocating more resources to localized campaigns. With many respondents expecting their budgets specifically for local advertising to increase in 2025, these teams are focusing on the channels and tactics that will be most effective as they either expand their localized strategies or begin them for the first time.
With consumers demanding more targeted, personalized messaging and brands, agencies and media buyers facing increased pressure to demonstrate ROI, engaging in localized marketing campaign strategies is an effective way to accomplish both. Between broadcast, CTV, streaming and more, advertisers are reinforcing the goals of national campaigns with local angles, driving consumer engagement and behavior in specific geographic areas and delivering targeted messaging that resonates with audiences for greater customer loyalty — demonstrating that a local advertising strategy is complementary to national advertising, as well as many other types of campaigns.
About Locality
Locality is the industry’s pre-eminent local video solutions provider, committed to addressing the evolving needs of advertisers by unlocking the power of local and driving dollars to the local video marketplace. Locality brings together the best talent in both broadcast and streaming helping brands tap into the mindset of the local consumer and precisely reach optimal markets. Having served more than 1,500 ad agencies and 4,500 advertisers, to date, Locality offers the best premium inventory that the industry has to offer to help brands optimize their spend and target audiences at scale with direct access to over 150 streaming publishers and 400 local broadcast stations. Our team operates from 11 locations across the U.S. designed to strategically service 100% of DMAs. For more information, please visit www.locality.com.
