When I visit local competitions, nobody is in the audience outside of some parents and a few skaters from the club. This makes sense if you view a local meet the same as say, a little league baseball game -- the little league stands are also just filled with parents and siblings. There's a little league game every weekend, the sport is there to burn off energy and teach the young kids good sportsmanship, and if you miss the game this time you can go next week and it will still be the same.
But a skater attends a local competition maybe three or four times a year. It takes months of practice to reach reasonable competency on a skating program, and there's the added expense of coaching and a skating costume. Practicing for the event is a five-hour-a-day endeavor, six days a week. Sorry, even a local skating competition is much more like a college baseball playoff game than like a little league weekend scrimmage.
The other place where this analogy breaks down is that the skill gap between little league compared to MLB is magnitudes wider than that same gap between a local skating competition compared to, say Worlds. For example I've attended some local Open competitions where a budding elite world-class skater would show up and skate, either to get in a good competition-mood practice session, or to motivate the friends in her club. Can't say though I've ever heard of a little league game where Kershaw pitched an inning or two.
A great deal of this difference in the sports naturally flows from the paucity of participants in figure skating (compared to baseball), and the compressed timescale over which competitive participation is viable. Skaters and little ballplayers can start at five and six years old, but you don't see a lot of Grand Prix skaters past the age of 25. A good number of MLB gents are in their late 30's.
Also different from baseball, there are no minor-league clubs in figure skating: everything is based upon individual athletes who affiliate with a local club forever (until the USFSA sponsors them globally). Ashley Wagner skates for Wilmington when she is a twelve year old novice as well as when she is the national champion runner-up. As a skater, this puts you in the "big leagues" pretty much as soon as you qualify for Nationals.
So why are local skating competitions so poorly attended? Besides simply a lack of marketing I can understand several other reasons: it's because watching the competition is cold and boring, it takes so long, there isn't enough variety, and the seats are hard without a backrest. If you're not an aficionado then there simply isn't much to see here. Frankly, in the United States figure skating's present appeal as a sport is rather limited.
It didn't always used to be that way. Back fifteen, twenty years ago you would get a reasonable crowd at the local competitions. Brothers and sisters, aunts and uncles, and neighbors a short drive away would all show up to enjoy the music and skating. It was more like coming to watch an inexpensive amateur Ice Capades. People could spend a couple of bucks for a couple of hours of artistic entertainment.