People Are Spending Like Crazy, But the Ad Market is Flat? Hmmm.
by Nick Coston, OOH, DOOH, pDOOH Professional; Industry Writer
I’m on the road again, so a mishmash of OOH industry-related thoughts and observations during the previous week. My eyes are on you… and you… and especially you!
• Let’s start with some simple economics. Earlier this week, the August inflation stats said high consumer prices in gas and food caused a 3.7 percent uptick in costs over this time a year ago. That’s two months in a row the inflation rate has risen after a full year of monthly declines. But the unemployment rate is just 3.8 percent, consumer spending has risen each month over the summer, and people are going out to eat, buying new cars, taking vacations, and attending movies, concerts, and sports events. Count my family as one of the key contributors to this rise in spending this summer alone.
Spending seems to be at the pre-pandemic normal, right? Sure, no one likes a $10 lunch tab at the Mickey D’s drive-thru, but as of this month, the average hourly pay is $28.16 an hour. These numbers rise together.
So when some key OOH media execs were dismissed from their jobs recently, it was subtly alarming that Outfront CEO Jeremy Male told Billboard Insider, “It would be very hard to describe the ad market as robust.” Entire DOOH departments at big firms such as The Trade Desk, Yahoo, Ubimo, and Catalina USA, to mention a few, are gone. So what is the truth about the health of our industry?
In Male’s interview, he says Outfront’s plan for 2024 is to bolster transit (which I’m a fan of), cut expenses, convert more static units to digitals, and make fewer acquisitions. That’s a solid game plan following Outfront’s recent spending spree. But my answer is a return to pushing local and regional ad sales and filling all that space with slightly discounted 12-week-plus contracts, just as we did coming out of 9/11 in 2001. It worked then and it can work now with all the digital screens.
But I wonder: Is this just a smokescreen by one of the brightest chaps in our industry to lower expectations while deep down he knows otherwise? Outfront has outstanding management, aggressive, seasoned salespeople, the best markets, and magnificent OOH products, from transit to roadside. But I’m not buying Male’s message. It feels like a motivational tactic. So don’t turn your back on Outfront and don’t doubt that they can smash 2024.
• Who’s heading to the IBOUSA (Independent Billboard Owners of the good ol’ USA) Conference in Indianapolis, Oct. 4-6? I am, that’s who. The last time I posted up at their members-only events was two conferences ago in Kansas City. I had fun, engaged with a lot of medium-sized OOH owners, and ate a vatload of doughnuts. I also spoke for about 15 minutes, which is 15 minutes more than OAAA asked me to do in the eight years I’ve been attending their conferences. I’m excited to be heading back, however. They are serious business folks with an undeniable love for our industry. And doughnuts!**
• Anyone here in the U.S. had run-ins with a German-based company called FRAMEN? Through mostly bizarre LinkedIn posts, they have been attempting to do business here. That’s great, but maybe they should tell us what they actually do. And why are they blocking industry writers and bloggers on LinkedIn for inquiring about their business? They never mention any revenues, any advertising clients, and any screens they may own in this country or overseas. It’s all quite murky.
• Out of Home New York is the new name for Digital Signage Week, which runs Oct. 9-12. The highlight as of now is the daylong DPAA Global Summit on Oct. 10. It’s a long, fun event with awesome speakers, networking, food, and drinks. The last 2½ hours is the evening cocktail reception. Cool, right? But as the unofficial gatekeeper of the OOH Industry Event Calendar, that same evening may also have the OAAA cocktail reception and the always-engaging Solomon Partners cocktail party. That’s three simultaneous events for many of the same crowd. I’ve asked for confirmation that the OAAA and Solomon’s events conflict. No word back as of this writing. So bring your roller skates. You will need them for party hopping.
FYI: There’s nothing really scheduled for that Monday night, Oct. 9, besides a private VIP dinner party and a digital signage mixer. Many of us will be very thirsty if anyone wants to buy beers and nachos that night.**
• Finally, congrats to everybody’s best friend, younger sister, little cousin, fellow ice cream aficionado, and good pal Stephanie Gutnik. It was announced Wednesday she has accepted the post of global chief strategy officer at Billups, the OOH planning and placement agency. That’s a great move for everybody, here’s to many wonderful years ahead for Steph. In all her excitement, she made a news release that she’s buying everyone who’s still around by 7 p.m. at the DPAA Global Summit a hot fudge sundae.**
** = I made this part up.
Nick Coston has been in the advertising industry for over 35 years. He’s worked at newspapers, magazines, OOH/DOOH companies, programmatic platforms, and ground-breaking ad tech companies, including Washingtonian, Washington Times, New Republic, USA Today Weekend, Clear Channel Outdoor, The Neuron and Hypercell. Currently SVP media sales/strategy at Smartify Media, Nick also spent 10 years buying OOH for a top 10 national advertiser. He resides with his family in Dayton, Maryland, and has been musing about the Outdoor Media industry for over five years.