Borrell Associates, a research firm specializing in U.S. local advertising spending and forecasts, expects streaming video to replace search as the largest local advertising category, reaching $30.8 billion in 2027. Its definition includes CTV and OTT alongside YouTube, Instagram, TikTok, and other social video, putting local broadcasters in direct competition with advertising systems designed to serve small businesses without dedicated salespeople.
Borrell raised its 2026 local digital-video growth forecast from 7.3% to 13.5%, with another 10% increase projected for 2027. The expanding market includes businesses that historically couldn’t afford TV advertising. Capturing that spending requires broadcasters to acquire and serve smaller customers at a lower cost while their traditional advertising revenue continues to decline.
The Prospect List Is Wrong
Borrell estimates that only 8% or 9% of local businesses historically could afford TV spots. The businesses entering video advertising increasingly operate outside the retail categories that supported traditional local TV sales.
Between 2020 and 2025, the US added approximately 1.6 million business establishments, bringing the total to 12.1 million.
Professional and business services establishments grew 29%, health and education increased 20%, and information-sector establishments expanded 49%. The combined retail, wholesale, and transportation sector grew just 4%.
The average private business also became smaller, declining from 12.7 employees in 2019 to 11.3 in 2025.
Local broadcasters historically concentrated their sales efforts on established retailers, dealerships, and regional businesses capable of making substantial advertising commitments.
Growth in smaller service businesses makes those traditional prospecting relationships less representative of the local economy.
An HVAC contractor, dental practice, or professional-services firm may have money for video advertising without having the marketing staff, creative resources, or budget associated with a conventional TV advertiser.
Those businesses also tend to have different advertising objectives. Customer inquiries, appointments, and qualified leads can carry greater immediate importance than broad awareness metrics.
Broadcasters must find more potential customers while generating less revenue from many individual accounts. That increases the importance of prospecting efficiency and the cost of converting each new business into a recurring advertiser.
A $500 Buy Breaks the Model
Roku Ads Manager allows businesses to launch streaming campaigns starting at $500. Advertisers can establish budgets, target audiences, upload creative, and measure results through a self-service interface.
Amazon offers self-service streaming TV advertising without a minimum spending requirement, including to eligible businesses that don’t sell products through Amazon’s retail store.
YouTube, Instagram, and TikTok have established similar expectations around video production, geographic targeting, budget controls, and campaign reporting.
These systems reduce the incremental labor required to serve another advertiser.
Traditional local TV sales operations carry costs that don’t decline proportionally with campaign budgets. Prospecting, creative production, campaign setup, reporting, and account management can consume substantial resources even when an advertiser commits only a few thousand dollars.
A larger advertiser can spread those costs across a meaningful annual commitment. A small business testing video for the first time may generate insufficient revenue to justify the same level of service.
The cost of acquiring and retaining CTV advertisers was already becoming a constraint on streaming growth. Borrell’s forecast puts that problem directly into the economics of local broadcast sales.
The growing number of potential video advertisers increases the value of automated onboarding, creative production, and campaign management. It also increases the cost disadvantage for sellers that require manual intervention on every account.
The 16% Problem
Borrell projects local broadcast-TV advertising will decline 4% in 2026 while local digital advertising grows 8.6%.
Traditional local advertising overall is expected to fall 3.8% this year and another 3.5% in 2027.
Digital advertising is projected to account for 75% of the local market by the end of 2027 and approximately 80% by 2030.
Traditional media companies already generate meaningful digital revenue. Borrell expects them to exceed $18 billion in 2026, representing only 16% of the local digital advertising market.
Broadcasters can generate digital revenue by selling their own streaming inventory or managing broader campaigns that include inventory controlled by other media companies.
Selling owned inventory preserves more of the media economics but limits the broadcaster’s ability to capture spending across the advertiser’s full media plan.
Reselling YouTube, social video, and third-party CTV allows broadcasters to manage more of that budget while introducing additional media costs and campaign-management expenses.
Gross digital billings can increase without a comparable improvement in retained profit.
The economics depend on how much revenue remains after paying third-party media owners, technology providers, sales commissions, and service expenses.
Broadcasters pursuing smaller accounts must also account for customer turnover. An inexpensive introductory campaign creates limited financial value if the advertiser doesn’t return or requires substantial ongoing support.
The more fragmented advertiser base makes repeat spending and contribution margin increasingly important measures of digital sales performance.
The Login Owns the Budget
Comcast is reducing the complexity of buying premium TV through Universal Ads.
In April 2026, the company added self-service access to Comcast-owned linear inventory alongside streaming, allowing advertisers to purchase and measure campaigns through one interface.
Magnite pursued a related approach through its acquisition of streamr.ai, adding AI-assisted creative production and campaign setup to help CTV publishers reach smaller advertisers.
Both approaches reduce the work required to purchase video advertising.
They also increase the influence of the company managing the transaction.
The buying interface becomes the place where advertisers establish budgets, evaluate campaign performance, adjust spending, and decide whether to renew.
A broadcaster supplying inventory through an outside marketplace can gain demand without controlling the advertiser relationship.
That relationship becomes more valuable when a business purchases advertising across several services.
An intermediary managing the campaign can recommend additional inventory, shift budgets between media owners, and expand the account into other products.
Amazon’s localized interactive advertising on Prime Video adds another competitive pressure by allowing advertisers to customize national streaming campaigns for individual geographic markets.
Advertisers can reach local audiences through a national buying system without negotiating separate campaigns with individual broadcasters.
Local stations retain established community relationships, market knowledge, and valuable programming. The buying systems increasingly influence how advertisers purchase those audiences and evaluate their performance.
The Renewal Pays the Bill
Smaller service businesses also place different demands on advertising measurement.
A regional retailer may evaluate video through incremental reach, store visits, and sales. A local home-services company may place greater emphasis on calls, appointment requests, and qualified leads.
Search captures consumers actively looking for products and services. Video can influence demand before that search occurs, including consumer activity that takes place later through search or direct website visits.
CTV sellers need credible ways to demonstrate that contribution without automatically claiming credit for every conversion that follows an ad exposure.
Measurement becomes more complicated when an advertiser runs search, social video, and CTV simultaneously.
A potential customer may encounter several advertising messages before contacting a business. Each advertising system has an incentive to associate that action with its campaign.
Smaller advertisers often lack the resources to reconcile competing measurement claims.
Broadcasters can provide value through local market knowledge, creative support, and campaign interpretation. Those services become financially sustainable when recurring advertising commitments cover the cost of providing them.
The ability to produce a first campaign cheaply expands the customer base. Efficient account management, credible reporting, and measurable business results determine whether those customers continue spending.
The Streaming Wars Take
Local broadcasters need to reconsider which advertisers justify direct sales attention and which should be served through automated systems.
The growth of professional services, health, education, and other smaller business categories creates an opportunity to rebuild prospecting around the companies entering the local advertising market.
Sales organizations organized primarily around established retail accounts risk overlooking that demand.
Large regional advertisers can still justify direct sales, customized planning, production services, and hands-on campaign management. Smaller businesses require standardized products, automated fulfillment, and reporting that doesn’t consume the economics of the campaign.
Station groups operating across multiple markets can spread those expenses across a larger customer base. Smaller broadcasters may depend more heavily on third-party systems and shared services to reduce operating costs.
Those partnerships require close attention to advertiser data, billing relationships, campaign history, and renewal rights.
A buying system that supplies leads, manages campaigns, and handles renewals can lower the broadcaster’s operating expenses while gaining greater influence over where future advertising dollars go.
Sales compensation also deserves scrutiny.
Rewarding teams primarily on gross digital billings can encourage revenue growth without accounting for third-party media costs or the labor required to manage small accounts.
Contribution margins, customer acquisition costs, repeat spending, and retention provide a stronger basis for evaluating the financial performance of those relationships.
The changing composition of local businesses also raises the cost of relying on historical advertiser lists. A station that continues pursuing the same shrinking group of large retail accounts risks missing growth among smaller service businesses already purchasing video through self-service systems.
Those advertisers establish buying histories, reporting processes, and renewal relationships with whichever company makes the initial purchase easiest.
A broadcaster pursuing them later must convince the business to change an existing advertising arrangement, increasing acquisition costs and potentially limiting its share of future spending.
Local TV stations that can’t profitably serve smaller advertisers early risk paying more to acquire those accounts after YouTube and other self-service buying systems have established the relationship.
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