REASON FOR OUTDOOR ADS

The American consumer has little time to hear that commercial on the radio, view the commercial on television or read the ad in the newspaper (see "Viewing Habits of the American Public"). The one advertisement that they are guaranteed to see is Outdoor Advertising. When they are driving, they are Outdoors captive audience.

As described in greater detail below, Outdoor Advertising is:

  • Less costly than other forms of advertising
  • Targets consumers who are more mobile than previously.
  • Competitive reach as compared to other media venues.
  • Creative design can create market awareness and name recognition.
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OUTDOOR ADVERTISING FOR PEOPLE ON THE MOVE
Outdoor Advertising provides your product and services a direct way to reach your audience. For this reason, beginning in 1994 through 1996, business entrepreneurs saw an opportunity to capitalize on the upcoming demand for outdoor advertising. They knew that outdoor advertising was moving up, from a discretionary advertising buy to mainstream advertising.

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BIG BIG OUTDOOR ADVERTISING

A privately held company was and still is, one of the largest outdoor buying services in the country, placing clients in outdoor advertising. Since they had the business, they began to purchase outdoor vendors and went public. One of their first purchases was Gannett Outdoor, a large billboard company in the northeastern United States that was purchased for 672 million dollars, to be following one year later by the purchase of 3M Media for 1.2 billion.
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During this time the stock had a price earnings ratio (PE ratio) of 200. The highest PE ratio of technology stocks were in the 70's.

What made this stock sell at this price, knowledge that the advertising market was shifting due to the habits of the American consumer, and the fragmentation of radio, television and print media.

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The consolidation in the outdoor advertising industry has been fast and furious, with companies acquiring the assets of smaller independent operators. Those companies acquiring the smaller operaters, know that demand for outdoor advertising is rising. As these acquisitions increase, the competitive pricing of the independent operators is fast disappearing.

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Additionally, more national clients are demanding a greater presence in outdoor advertising then ever before, creating a greater demand for limited signage. The national advertisers are aware of the fragmentation of newspaper, radio, television, and print media.

The nationals are changing their media mix to generate a greater return on their advertising investment, and they are doing it with outdoor advertising. Shouldn't you do the same?