All signs point to a struggling out-of-home industry as consumers stay indoors amid the novel coronavirus outbreak.
Outfront Media's stock, for instance, has fallen 64 percent to about $11 a share since late February; Lamar Advertising is down 52 percent to $41 a share during the same time period. Clear Channel, meanwhile, is coming in under a dollar ($.45) for the first time in its history.
Lamar declined to comment; Clear Channel and Outfront did not comment at deadline.
“There is no way to sugarcoat that demand is incredibly soft right now,” says Matthew O'Connor, co-founder and CEO of AdQuick, a tech company that’s applied programmatic to buying out-of-home media. “Nobody wants to do a huge product push right now, so business is down and will continue to go down until things go back to normal.”
Prior to the coronavirus outbreak, out-of-home had been enjoying an incredible run. Revenue for the vertical rose 7 percent in the third quarter of 2019 to nearly $2 billion, according to the latest figures from the Out Of Home Advertising Association of America. Year-to-date, the out-of-home industry generated $6.4 billion through the first three quarters of 2019, a 7 percent uptick when compared to the same time last year.
“Like every industry, out-of-home is currently navigating the COVID-19 crisis in real-time,” says Anna Bager, president and CEO of OAAA, who adds that it’s “too soon to know exactly what the impact of this crisis will be in the near-term.”
“We’re taking this day-by-day,” says Bager. “I can say with confidence that the fundamentals of our industry are strong.”
Still, companies such as AdQuick are reacting to the pandemic now. Just yesterday, AdQuick said it was waiving its 3.9 percent buying fee in an effort to drum up business — a practice some billboard owners are also applying.
Such moves are a direct result of cancelations for major tentpole events. Concerts such as Coachella, for example, increase the cost of acquiring prime billboard inventory near the music festival by 40 percent, but it — along with nearly all other events — have been canceled or postponed until further notice. Overall, prices for out-of-home inventory are down about 15 percent, says O'Connor.
“It’s reflective of the amount of people willing to leave their homes,” says O’Connor, who adds that consumer foot traffic has fallen between 30 to 70 percent.