Economics of Outdoor & Out Of Home Advertising, a newly-released study by SNL Kagan [1], 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 [2], Clear Channel Outdoor Holdings Inc. [3] and Lamar Advertising Co. [4] 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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