The good news is that the local online ad market is growing, and will continue to make up a larger percentage of the local advertising sector. In 2009, nearly 12% of local ad spending will be digital, with dollars focused on Internet yellow pages, local search, e-mail marketing and other online tactics.

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In 2013, the digital share will jump to over 22%, and might grow even higher.

“The share shift we expect [between traditional and digital] could actually be more pronounced if the major traditional media are not able to integrate new interactive products into their bundle,” said Neal Polachek of Kelsey.