NEW YORK (AdAge.com) -- It's not just the U.S. media curbing their ad-spending projections for 2009. The global outdoor ad market is also forecasting signs of softness, as European outdoor titan JC Decaux recently scaled back its revenue projections for 2009 from 6% to 5.5%.
"We still expect to outperform the rest of the market," said Jeremy Male, CEO of JC Decaux U.K. and Northern Europe, at the 36th Annual Global Media and Communications Conference in New York. "But the key word I would use for next year is 'late.' All the money will be coming later. Advertisers, unless they feel compelled to lay money down now, will pay as the money comes."
The global outdoor advertising market has seen significant maturity in the past 15 years, when one-third of the top 200 advertisers were spending on media such as billboards, transportation and street furniture, Mr. Male said, a ratio that is now up to 90%. Although outdoor typically holds up well during times of recession as marketers look for efficient alternatives, transportation and airports have taken a few understandable hits.
"The problem during the last recession is we had 9/11 to deal with," he said. "But we've never had a negative year in street furniture, that's always been an area of growth for us."
Although static billboards still comprise the bulk of JC Decaux's revenue, the company is slowly becoming more digital as technologies become more widely available and cost-permitting. Mr. Male said about 18% of the revenue for Terminal 5 in London's Heathrow Airport were digital in 2008, accounting for about 10% of the British Airport Authority's total revenue. Billboards are also slowly becoming more digital, "but they only contribute a couple percent in total revenues," Mr. Male said.
Street furniture, which relies on expensive city leases and rental fees, has "very small, almost negligible" digital presence. "We haven't found the right product that works yet," Mr. Male added.