The U.S. economy seems to be slowing down, and even if it does not hit the "recession" threshold it’s important to understand what to do if it does. There is a strategy to renting billboards in tough times that revolves around certain advertisers and methods. In this Billboard Mastery podcast we’re going to explore successful "recession-resistant" marketers and how to attract them.
Episode 117: Recession-Resistant Advertisers Transcript
Back during the Great Depression in 1929, St. Louis, Missouri liked to have as a slogan that they were first in shoes and first in booze. Because people found during the Great Depression that there were only two kinds of things that sold. Necessities and vices. By first in shoes, shoes are a necessity, you had to have shoes. Even during the Depression, shoe sales actually went up because as people were walking around more trying to get work, they would get holes in their shoes and have to buy a new pair. And the same with booze. When they said first in booze, St. Louis was a very large beer market. And again, that's a commodity people bought. Even when times were bad, they refused to give up liquor. It gave them kind of an escape valve from the hard realities of the Depression. But that same slogan from St. Louis back in the Great Depression still holds true today. This is Frank Rolfe, the Billboard Mastery Podcast. We're going to explore recession resistant advertisers. And I'm kind of an authority on this because I've been through so many recessions, including the mother of all recessions in my lifetime, which was the Texas savings and loan crash of the 80s.
And here's what happens when times get tough. When times get bad, some advertisers go bankrupt. Some withdraw completely from marketing. Some cut their budgets. But others don't even realize there's a problem and some actually find that they have higher sales when times are bad. Those are the ones you clearly want to focus on. So who are those advertisers? Well, the first category of recession resistant advertisers are fast food restaurants. And that's a good thing because McDonald's has long been one of the largest advertisers in the entire outdoor advertising spectrum. So why do fast food places do good in bad times? Well, it's simple. They're cheap. You can sometimes some people argue you can eat at fast food restaurants like McDonald's cheaper than you could actually buy the ingredients to make the food. Now, of course, that would be necessitated on using the value menu probably, but heck you can go over to Taco Bell on any day and get a bean burrito and a taco and walk out with change on $3 in your pocket. You couldn't buy the ingredients probably for $3 and cook it. So fast food when times are bad, people buy more of it.
It's the cheap alternative to other types of dining. So fast food has always been a very good recession resistant advertiser. If you can get a McDonald's or a Wendy's or a Taco Bell or anything of that variety, that's an advertiser that will typically not let you down. Now another recession resistant advertiser are roadside hotels and motels. Places like Holiday Inn. Those have been mainstays of the industry since it began. Now why are those recession resistant? Well because they have no way to advertise except on a billboard. There's nothing else they can do that is point of purchase that reaches people right when they're approaching the exit to where they are. And people tend to travel about the same in the bad times as the good times. Some of it is work related. Sometimes people are driving across America trying to find new employment, but nevertheless they have to have a place to stay when they're out on the road. And if you have a Holiday Inn, exit number 173, the best thing you can do, as the owner of that Holiday Inn, is to have a billboard coming each way so people know where to get off.
So again, those kinds of advertisers are very recession resistant. And then you also have gas stations and fuel stops. So gas stations and fuel stops, you have to have gas for your car. It's an absolute necessity. If you don't buy it, your car comes to a complete screeching halt. And once again, it's a point of purchase issue. If you've got a British Petroleum, a BP station at mile marker 275, you've got to get a billboard out there each way saying, hey, you need gas? Exit at exit number 275. So again, those advertisers still sell pretty well during recessions and they still definitely need those billboards. Now those are all necessity styles of recession resistant advertisers but what about vices? What are some of the things that people will buy which they probably should and it's not really good for them but they do even in recessions and depressions? Well one that I found during the Savings and Loan crash that their business seemed to be doing fine, or even better, were topless bars. Any type of adult entertainment venue. Because people were so depressed with their life, they wanted to retreat into some other happy place for them, and that made the sales at things like topless bars go up significantly.
So that's a fairly recession resistant good advertiser, which I've had many topless bars on billboards, and they've been very, very good payers, easy to work with. So there's a recession resistant vice. Another one are personal injury lawyers. Now many people in America kind of look at the American judicial system as a lottery, as a way to score big. It's no different than going to Las Vegas and putting all their money on Black 23 on the roulette wheel and hoping that they win. And those personal injury lawyers realize that. And when times are tough, people really tend to sue more, trying to get money. So that's why you'll see a big proliferation of personal injury lawyer billboards when times go bad. And when they're good too, because it is a recession resistant little niche. People are always daydreaming about getting a big settlement for almost anything.
You probably saw recently that a guy who drove through I believe a Starbucks and then sued Starbucks because he claimed that the lady working at the window dropped hot water on his lap. Now I saw the video as you may have also and it sure looked like she did everything exactly according to plan, handed him his, I guess, coffee drinks on a drink carrier. And he's the one who dropped it. She did. And you can see she clearly hands it through the window and he takes it away from her. Then he drops it. But nevertheless, the jury awarded him millions of dollars in damages. It will certainly be appealed. But every time Americans see these kinds of bad jury decisions, it just entices them more to want to sue. So personal injury lawyers, those are again very, very recession resistant. And then you have attractions, things like, you know, RV parks, caves, Meramec caverns. Again, these are things that they don't really have another way to reach customers other than your very point of purchase billboard. And a lot of Americans will still stop and do those things as a vice because it's experiences they want to share with their family. And even though it's it's it's money. They shouldn't really probably spend if times are tight. They still are not going to forgo having those kinds of memories as families. So those kinds of attractions are also fairly recession resistant. I've had a lot of them over time. They pay very well. They're very consistent.
But now despite those necessity and vice options, here's another tip that you should know of how to really do well and survive and flourish in bad economic times. And that is to reduce the cost of the sign to the advertiser and you can do that by combining advertisers together. So let's say from that necessity list we just went over that you've got a McDonald's that's next door to a Holiday Inn. What do you do? Well, put both of them on your sign. You can take any sign and basically split it in half and that means each advertiser will still reach the population out there but at half the cost. And best yet, have them at the same exit. That makes it so easy because they have a common exit line across the bottom and then you divide the upper portion in half each with their own ad message. And if you've got three at that exit, If you have the triple crown of fast food and a hotel and a gas station or fuel stop, well, let's get three on there. As long as they share that same common exit, now you're talking they each would only pay a third of what they would have to pay on their own.
Same with attractions. If you can find multiple attractions and often there are multiple attractions at the same exit, get those on the sign. Or you could even mix some of those attractions with the necessities. I've had billboards where they were split between a topless bar and a truck fuel stop. Again, what it allowed me to do was to get the cost of the advertiser down significantly and they really appreciated that. The bottom line is even when the economy goes down the drain it doesn't mean you as a billboard owner should have any problem getting your ad space rented. But it requires you to think a little outside the box and get back to the basic roots of what works in tough times, and that's necessities and vices. This is Frank Rolfe, the Billboard Mastery Podcast. Hope you enjoyed this. Talk to you again soon.