Economics of Outdoor & Out Of Home Advertising, a newly-released study by SNL Kagan, Monterey, California, has projected the outdoor/out of home industry will grow at a 5.9% CAGR to reach a total market value of $10.55 billion in 2020.
The company says that although the outdoor advertising market was up by an estimated 3.0% year over year overall in 2011 to $6.31 billion, it has not managed to claw back the roughly $1.4 billion of revenue it lost between 2007 and 2009. it notes that, although none of the three major public outdoor/out of home groups escaped the recent financial crisis, the trio of CBS Outdoor, Clear Channel Outdoor Holdings Inc. and Lamar Advertising Co. has seen some upswing since, managing to grow total revenues over each of the past seven quarters.
These companies have been riding a positive trend since the beginning of 2010, with combined revenues for the first nine months of 2011 up 6.8% to $4.41 billion from $4.13 billion in the prior-year period. The gains have not been able to cover the $1 billion decline between 2007 and 2010, however, when combined revenues for the top three operators dipped from $6.70 billion to $5.71 billion.
While SNL Kagan expects the outdoor/out of home ad industry to continue its mid-single-digit revenue growth over the 10-year projections period, it says that operators will need to remain versatile in delivering low-cost and effective ways to reach both mass and targeted audiences, even as other media platforms become more niche-oriented and fragmented.
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