Successful billboard owners don’t see their mission as making money, but instead as “matchmakers” that fill a need by combining property owners and advertisers to create advertising opportunities. If you approach the industry in this way, you can rarely not succeed. In this Billboard Mastery podcast we’re going to review the mechanics of “filling a need” and how this focus will help you to be much more successful with billboard investing.
Episode 51: Filling A Need Transcript
We all know what a matchmaker is. We see ads on television all the time, talking about various dating services, trying to link together, people who wanna go out and meet other people, potentially get married over time. But are you aware that billboard owners are also match makers? In fact, that's probably our number one primary purpose in life, is to match advertisers to property owners. Now, advertisers across America who try to reach customers, they wanna sell things, and we all know that advertising is the important first step to getting something sold.
And many of them would like to use outdoor advertising, but the problem is often there's none available where they want to be, or if it is, if there are signs there, they're not in a price point that they can afford to pay. So what the billboard person does is they try and seek out properties that have just the right visibility, just the right location to get a permit, and then to build the billboard that the advertiser truly wants. That's our role, nothing more. It would never be successful to build billboards in the absence of demand, so without us, those signs just simply won't exist.
There's no way that the advertiser can ever transfer their desire into making the billboard on their own. It's impossible. But there was a time when you could do it. Part of the Highway Beautification Act of 1960, billboards can be placed anywhere in America on any road, without any limitation, and the advertiser could simply march down the street and go in there and build a billboard by just painting their advertisement on a sheet of plywood and nailing it to a tree. You could have signs stacked up all over each other. If you look at pictures of highways back in the day, you see just that. At a busy intersection, you'll see 10 or 20 billboards all stacked upon each other, about an inch of difference between them. But the Beautification Act changed all that.
Suddenly there was a need for people to strategize where the signs could go. And because the capital investments then went up because the signs were fewer and therefore larger, it behooved the people building the signs to make sure that they were building something that was desirable to advertisers, and that's when the true matchmaking genes came into play. Now, all your early billboard companies, they understood this. The White Company, which later become Whiteco, now The Lamar, it was a company that was devoted to Holiday Inns. Mr. White basically went to all the Holiday Inns in America and sought out, where do they want signs? And they would hear, "Oh, well, I wanna sign on each highway coming into town." Or they'd say, "I wanna be on each highway coming in, but I wanna be exactly five miles distant from the exit." And he would then set about trying to find just such a location to build that sign for Holiday Inn.
That's how most of your billboard operators originally began, but today, we all lose sight perhaps of what our true role is in the world and that simply as a matchmaker. Instead, we see ourselves more fancifully as someone who builds giant steel signs along the interstate highway. And the problem is, if you get too carried away with the goal of simply to build things, often you're not building the right thing that people want. Not every advertiser wants or can afford the big steel monopole sign, some want the smaller wooden sign that actually more fits their budget. And there's some parts of America you shouldn't be building signs at all because there simply aren't any advertisers.
Now, being a matchmaker can go beyond just the boundaries of billboards. There's many other out of home products that also fall into that category. You see them all the time. You see ads at the airport, you see ads at shopping malls, you see ads everywhere. Parking lots, gas pumps, those all fit under the classification of out of home advertising, the same as billboards. But they're there designed to fit another need, because someone saw as a matchmaker the need for advertising in those places too. Remember when the mall advertising was a big deal? They brought mall ads typically around the directional signs in malls, and people said, "That was clever." Now, of course, Polo and Gucci and other brands would like to have ads inside the mall and now they can. That was a match-making idea.
You've seen those little signs across America's highways that have these little logos of every business at that intersection, every fast food, every hotel, every gas station. Another genius matchmaking idea, "Let's go ahead and match up advertisers at the exit to these little signs along the highway. And by the way, let's make money doing it." You see, in the world of billboards, matchmaking is a high paying job. Unlike when you're trying to get people together to have just that lunch or one of those dating accessories you see on television, the world of billboards creates lifetimes of income. Build the right sign in the right location, great things will befall you.
So there's good money in being a matchmaker if you're in the billboard business. But it's very important whether you want to enter as a billboard owner or just in the general out of home sphere that you understand your role, and your role is that as a matchmaker. And as long as you focus on that, you can never go wrong. As long as you realize that you have to fit something and put something together that meets the needs of the advertiser as well as the needs of the property owners, as well as the needs of you, then as long as you're making all three parties happy, nothing but success will befall you. But it's very important you never forget this simple fact, don't build signs that advertisers don't need. Don't build signs that are unprofitable. Don't build signs that can't pay a reasonable return to the property owner. When you start veering off to that path because you forget your true goal, then it's very, very hard to be the success that you feel you should be. This is Frank Rolfe with the Billboard Mastery podcast. I hope you enjoyed this. Talk to you again soon.