Memo From Frank
I have noticed a lot of vacant signs in my area recently, which is a direct result of the election ending and a huge number of billboards going empty at the same time. This is a tradition in outdoor advertising which has gone on every four years since our country was founded and they could find things to paint ads on. Whether you were an Obama or Romney supporter, nobody is a supporter of vacant billboards. So if you ever get a call during a political season on renting your sign, always remember that political advertisers share one thing: non-renewal. There is absolutely no future in a political ad. After the election, it’s absolutely worthless and the chance of renewal is zero. So think about that before you rent your sign for a campaign ad. I used to always avoid them like the plaque for that very reason. Sure, they often pay above-market rents. Sure, they are always courteous and professional on the phone, and can have the creative to you immediately. But the long term effect is that you get stuck with a bunch of vacant signs going into Christmas –when most advertisers are already procrastinating until after the holidays. I’d rather have a good old-fashioned Motel 6 on a billboard at $500 per month continuously, than a political ad for $700 per month for 6 months followed by a few months of vacancy – and the revenue is the same.
The Difference Between Art And Science In Billboard Leases
Everybody has a right side and left side to their brain. One is artistic and one is mathematical. Most people are best at one function or the other. But there is the need for mastery at both if you are to succeed in the billboard business. Most of the top names in the billboard industry, since inception, were people who either had aptitude at both skills (like Ted Turner), or were very good at delegating it (such as John Kluge). But you need to understand these two roles and how they relate to the business.
The Importance of Volume
Obtaining leases to either build billboards or rent their advertising space, are the end result of one statistical fact: the power of volume. Essentially, the more billboard locations you call on, the better your odds of scoring a ground lease. And the more advertisers you call on, the greater chance you have of renting your ad space. So if we are all in agreement that the key to success is volume, then how does that relate to science?
How Science Creates Volume
Volume is the end product of science skills. You create a machine to sort information into prospective targets, and then you feed as much information into the machine as you can to get the largest number of possible targets to hit. Like any assembly line, the industrial engineer – you – has to figure out how it’s all going to work. For billboard ground lease production, you need to know the ordinances, then map out the correct zonings on a zoning map, and then mark in the legal spacing on those zonings. Then you’d have to build another assembly line to find the name and address of the property owner and then send the offering letter. Like any good assembly line, if you don’t have the steps in the right order, you won’t be able to create decent volume. The same is true on renting billboards. You have to find all the potential advertisers, and then create assembly lines to reach them, whether it’s by direct mail, phone call, or some other means. All of this requires science skills in math and organization.
But Art Skills Are Just As Important
The biggest “art” skill you need are sales and people skills – not the ability to draw a picture. Many people who are good at science are terrible at selling. If that’s you, then you need to start studying and practicing sales techniques. Because even if you reach 1,000 potential advertisers through terrific science skills, you’ll never be able to sell them anything if your basic sales skills are lousy. It would be like a television show that is well promoted and everyone tunes in, and then the show is horrible.
You Have To Have Both
Being a terrific salesman is a great thing, but of no value if you have to customers to pitch. And having a giant list of potential customers is of no use if you have no sales skills. So I think we can all agree that you have to have both skill sets to succeed. But what if you only have one? Then you have two choices: 1) get better at the one you are weaker at or 2) hire someone to take over or you on the one you’re bad at. The problem with hiring somebody is that it’s expensive, and open you up to the potential of them starting a business of their own after you show them the ropes. So most billboard owners go it alone. Another option, of course, is to forge a partnership with someone who complements your skills by having the opposite skill set. But the bottom line is that you have to acknowledge what you’re bad at, and find a way around it.
The Billboard Business Is Not Alone In This Issue
Most great businesses began with a founder who had both of these skill sets – people who could sell but were also good with numbers and building systems. Sam Walton, as an example, was a great salesman, but equally good at coming up with efficient systems and watching numbers, which is what made Walmart such a huge success. The same is true of Ray Kroc, who founded McDonalds – and the list is endless.
So What’s The Point?
The point is that you need to be honest with yourself on what your weak spots are, and take steps to improve them or work around them. You can’t be one-dimensional in the billboard business and succeed. You need to be good at both art and science. If you can find your weak spot and make it equally strong, your odds of success will go up exponentially, and you will even make gains in your personal life. Our educational system encourages specialization and focusing only on your strong suits. That’s great if you are a doctor, lawyer, or CPA, in which their business success is based on only that one narrow skill set. But business owners have to be well-rounded to succeed. So start working on your weak spots and you’ll enjoy much more success.
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A Billboard Tip
I recently was horrified to see some guys from a billboard company chopping down foliage off the highway right-of-way that was blocking the view of their sign, in the middle of a week day. Even though I don’t advocate doing such a thing, it makes a whole lot more sense to perform such a project at 6 AM on a weekend, when nobody from the highway department is out driving around. You can imagine the end result if somebody had seen them and pulled over (like the highway patrol, for example). The penalties for illegally cutting trees and bushes on highway property is severe, so it makes little sense to do it at prime time on a weekday.
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Billboard Boot Camp
February 23 & 24 2013 - St. Louis, Missouri
How to find billboard locations in small, medium and large towns and cities.
10 “outside the box” ways to find billboard locations almost everywhere.
The right way to approach a landowner.
How to determine the correct size and location for the sign.
10 ways to always find an advertiser – even in the recession.
How to properly service your customers.
How to get financing.
The steps to flip leases and permits for immediate cash flow.
How to build an operation that you can sell down the road.