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Here’s What Local Advertisers Are Thinking About In Second Quarter.

Will 2021 mark a return to 2019 spending levels for local advertisers?The answer, according to March survey data from Borrell Associates, is a definite maybe. One third (33%) of local advertisers in the company’s Small & Medium Business Panel said they’ll spend more, with an average increase of 31% more than in 2019.Another third indicated they plan to spend the same amount and 29% intend to spend less on marketing and advertising than they did in 2019, with an average decrease of 44%.

“Looking at the one in three who plan to spend more this year than they did in 2019, it’s clearly because they’ll be buying more things, not buying more of the same thing,” Borrell says in the report, “SMBs Prepare Their Q2 Marketing Strategies.” Seven in ten marketers who said they will spend more this year than in 2019 indicated they’re adding more methods to their mix. (Inside Radio would note that this represents a sizable opportunity to market to businesses that aren’t using all of the tools in radio’s toolbox.)

Among those upping their budget, six in ten (58%) said they plan to increase the frequency of their message and 34% plan to shift to marketing methods that cost more.

Conducted in March, the survey, which had 214 responses, asked marketers about how things shaped up in the first quarter and how they’re looking for the next three months and the rest of the year.

Nearly half of the panelists (46%) said things were better in first quarter 2021 compared with Q1 2020, while 29% described them as the same and 25% said they were worse than last year at this time. Underscoring how cautious local advertisers were in Q1 2021, half said they held back completely on local media advertising and on social media.

The new numbers also show that first quarter spending was flat to down. Four in ten respondents indicated they reduced their ad spending in Q1 compared to 2020, 28% increased it and 32% kept it the same. Looked at another way, 60% have maintained spending or increased it compared with last year.

With second quarter underway, competition is a concern, especially from local competitors. More than half of panelists (56%) are concerned over what competitors will do between now and September. More are more concerned about local competitors (60%) than national (18%) or regional ones (12%). Asked how their company will react to increased competitive pressure, 60% said their remedy will be more social media, 40% will spend more on marketing and advertising and 36% intend to add new types of media to their marketing mix.

A Good Deal Can Change the Ad Budget

Demonstrating that local businesses are bargain hunters, more than half of panelists say their spending plans are swayed by good opportunities and “deals.” While 43% say their spending is determined by what they planned for (their budget), 57% of panelists indicated they don’t go by the budget.

Several marketers participating in the survey said in verbatim comments that they would return to advertising with a "shop local" sort of message. “My shop is in a smaller, more rural type community so I am still hammering away with ‘shop small, shop local’ message,” said one participant.Said another, “What we plan to do differently is community-based and highlighting our participation/involvement.Alternatively, we will increase traditional advertising spend based on how the previous month’s sales are.”

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