STRATEGIZING YOUR BILLBOARD INVESTMENT: A MODERN APPROACH By Frank Rolfe

Securing a legal spot for a billboard is just the first step in a nuanced process of deciding on the best size and type for your investment. The landscape of outdoor advertising has evolved, offering a diverse array of options to match every possible scenario. Here's how to navigate these choices effectively today.

Diverse Options for Every Setting

The billboard industry has innovated extensively, providing solutions for various environments—from rural roads to urban highways, and everything in between. Whether it's a compact 8-sheet billboard or a massive wallscape, or whether the structure is a single metal pole or a more complex wooden assembly, there's a design to fit specific needs.

Starting with the Budget

Your journey begins with financial modeling. By comparing your potential billboard's rates to those nearby and accounting for expenses like ground rent, maintenance, and utilities, you can forecast the net operating income (NOI). This NOI, when divided by the desired return rate (often 20%), dictates your construction budget. For instance, a billboard expected to generate $10,000 annually gives you a $50,000 construction budget when aiming for a 20% return.

Budget-Driven Choices

Your construction budget immediately influences your options. In less trafficked areas, you might be limited to simpler wooden billboards due to budget constraints. As your budget increases, more sophisticated structures like steel monopoles become feasible. It's critical to adhere to this financial discipline to avoid overextending financially for minimal returns.

Determining the Size of the Billboard

Choosing the right size involves several considerations. Competitive analysis, visibility from the road based on traffic lanes and setbacks, and adherence to industry standard sizes are paramount. Matching the size to competitors while ensuring visibility and sticking to standard sizes can make your billboard more appealing, especially if you aim to attract interest from larger, national advertisers in the future.

The Importance of Standardization

Big players in the billboard industry, such as CBS, Lamar, and Clear Channel, prefer standardized sizes for ease of operations and inventory management. Aligning your billboard to these standards not only facilitates future sales to larger entities but also streamlines the production and installation of advertisements.

On-the-Ground Realities

When your budget allows for a choice, consider the activities on the property beneath the billboard. A bustling retail or industrial space might necessitate a steel monopole to minimize interference. The specific placement and design should accommodate the landowner's needs without compromising your budgetary constraints.

Optimal Height Considerations

A common mistake is building billboards too high, diminishing their visibility and impact. The ideal height balances the need to rise above obstructions with maintaining prominence in the driver's field of vision, enhancing the advertisement's effectiveness.

Conclusion: Choose Wisely for Success

The decision on the type and size of billboard to construct should be made with careful consideration of all relevant factors, from budget constraints and competitive landscape to visibility and industry standards. A strategic, informed approach in the initial stages of development can set the foundation for a profitable and successful billboard investment.

By Frank Rolfe

Frank Rolfe started his billboard company off of his coffee table, immediately after graduating from college. Although he had no formal training on the industry, he learned as he went, and developed his own unique systems to accomplish things, such as renting advertising space. Frank was formerly the largest private owner of billboards in Dallas/Ft. Worth, as well as a major player in the Los Angeles market.