After years of stagnation, outdoor advertising exploded in the first decade of the 21st century, thanks to the advent of digital displays -- but its meteoric growth was cut short by the economic downturn from 2007-2009, according to a new study from SNL Kagan. Still, outdoor advertising is back on track, according to “Economics of Outdoor & Out Of Home Advertising,” which predicts strong sustained growth.
Indeed, SNL Kagan is forecasting a 5.9% cumulative annual growth rate over roughly the next decade. At this pace, total spending on outdoor advertising should reach about $10.55 billion by 2020.
Total outdoor advertising revenues came to $6.31 billion in 2011, up 3%, SNL Kagan calculates -- a respectable growth rate when compared with the advertising business overall, which saw total spending increase 1.5% in the first nine months of 2011, according to Kantar Media.
Total revenues are still down about $1.4 billion from their 2007 level, meaning the outdoor industry is still about 19% below its 2007 peak.
SNL Kagan’s figures are broadly in agreement with estimates from other industry organizations. According to separate figures from the Outdoor Advertising Association of America, total outdoor ad revenues tumbled from $7.3 billion in 2007 to $7 billion in 2008 and $5.9 billion in 2009, before rebounding to $6.1 billion in 2010.
However, outdoor advertising has since returned to a steady growth trajectory, as evidenced in seven straight quarters of growth at big players, including Clear Channel Outdoor, CBS Outdoor and Lamar Advertising Co.