Out-of-home the Second-Fastest Growing Medium Behind Internet, with Digital Billboards Leading the Expansion

Adweek’s article today pictures a bright future for Out-of-home advertising, and especially for the digital billboard technology. “Next year,” Laureen Miles writes, “total spending on out-of-home will skyrocket 12.8 percent to $8.94 billion versus this year, per Veronis Suhler Stevenson. PricewaterhouseCoopers predicts more conservative but still outstanding growth of 9 percent to $8.12 billion in 2008, on top of this year’s 8.9 percent surge. Out-of-home is the second-fastest growing ad medium behind Internet, with projected 8.2 percent compound annual growth in the 2007-2011 period, according to PwC.”

Lamar Advertising digital billboardLamar Advertising currently has the largest electronic billboard network in the United States with at least 150 billboards deployed at this time. Photo credit: Lamar Advertising

Although static billboards are growing as well, digital billboards are leading the expansion of Out-of-home: “Billboards, both digital and static, constitute 65 percent of the out-of-home market, per PwC. The double-digit gains billboard have enjoyed since 2005 are projected to continue into 2008, mostly due to the growth in digital boards, which can generate 10 times the revenue of a static board,” said Stefani Kane, partner in PricewaterhouseCoopers’ Media and Entertainment Practice.

While digital billboard inventory has exploded, demand has stayed high, and so have rates. The targetability and changeability of digital boards and better measurement have kept prices aloft, experts say. “All this gives added value, so we’re not seeing a high slippage in dollars,” Kane explained.

Add comment September 24th, 2007

Industry Growth Stats: a Quick Refresh

This piece, published today, says the InfoTrends study that came out this summer, valued the narrowcasting industry (in this context meaning digital signage) at $1.1billion at the end of 2006, claiming an installed base of 630,000 screens at 97,000 sites.

“Compared to the 2004 statistics,” says the preamble to the study, ”these numbers represent a CAGR (compound annual growth rate) of 56%. This growth marks the first time that the narrowcasting industry has exceeded previous estimations and represents a significant turning point.

North American Narrowcasting Industry Revenue 2006-2011

By 2011, InfoTrends sees North American digital signage revenues exceeding $2.5bn.

An earlier study, by Profitable Channels, estimates the ad spending on Out-of-Home digital media in 2006 at $1.2 billion. The research summary says Out-of-Home digital ad networks are part of the new digital media ’slice of the marketing and communications pie’, which grows at a rate of over 20% a year.

Add comment September 24th, 2007