The Thomas Partnership: The 'Outdoor' Market
Overview
Unlike TV, radio or print, which can see the launch of new channels or publications, town planning control limits the number of potential new advertising hoardings.
As the media cannot be diluted by the sudden influx of new sites the long-term value of 'Outdoor' advertising is assured.
The positive effect of this and of the market consolidation is that contractors are well financed and committed to provide an efficient service to advertisers by maintaining existing plant and investing in the development of new products/formats. However, from the landowners perspective the consolidation of the number of national hoarding contractors and the limited opportunity for new entrants may result in less competition between contractors to win or retain sites.
Furthermore, small regional contractors are, for the most, part selling their sites through the larger contractors and accordingly acting more in the roll of site brokers, extracting income by way of a profit rent which the landlord could otherwise receive.
Recent Market Activity
The last three years has seen considerable activity within the corporate world of 'Outdoor' which has included the public listing of Maiden Outdoor, takeovers of More Group, Mills and Allen, Primelight, Parkin Advertising, Maurice Stam, Signways, Vision Posters, Postermobile, Allied Outdoor, Town and City Poster Advertising, Wessex and Trainer to name but a few.
This consolidation may ultimately limit landowners options for inviting competing bids, particularly on a regional basis. Hence, TTP’s continued observations of the working practices of Outdoor contractors.
The indications are that if restrictive practices are identified and reported the Office of Fair Trading (Media Department) may be willing to act. If any such restrictive practices are known to you please e-mail your information to info@thethomaspartnership.com. This is a very serious issue which needs to be addressed.
If restrictive practices do manifest themselves and no enforcement is taken the only viable option will be for landowners to retain control of advertising rights and to market them individually or collectively via contractors/marketing agents on a commission basis. Realistically, this could be achieved within a 3-5 years timeframe and would generate considerably enhanced income, albeit that operational management and servicing would then need to be sub-contracted directly.