WHY LOCAL ADVERTISERS OUTSHINE NATIONAL ONES FOR BILLBOARD ADVERTISING By Frank Rolfe

The landscape of billboard advertising varies greatly between rural and urban areas. This difference is often attributed to the type of advertisers – local versus national. Here are some insights into why local advertisers are generally more advantageous for billboard owners.

Local Advertisers Are Easier to Secure

Local advertisers are more accessible than national ones. Early on, many assume they can easily secure national advertisers like McDonald's or Coca-Cola. However, reaching these large corporations is challenging due to their reliance on major advertising agencies. In contrast, local businesses are more approachable, interested, and willing to sign contracts. There are thousands of potential local advertisers for every national advertiser, making local businesses a more viable option for billboard advertising​ (IBISWorld)​.

Higher Renewal Rates with Local Advertisers

Local advertisers are more likely to renew their contracts. They can directly measure the impact of their billboard advertisements on their business. A successful billboard often enjoys long-term patronage from local businesses, with renewal rates averaging around 80%. National advertisers, however, are less interested in renewing unless they have another specific campaign, making them less reliable for long-term income​​.

Flexibility and Negotiation

Local advertisers offer more flexibility and room for negotiation. If a local advertiser hesitates to renew, a simple price adjustment can often secure the deal. With national advertisers, decisions are made at the corporate level, and local billboard owners rarely get the chance to negotiate directly with decision-makers. Even if offered at a discount, national advertisers may still decline due to their rigid, top-down decision-making processes​ (DASH TWO)​.

Longer Lease Terms

Local advertisers are more likely to commit to longer lease terms. They recognize the value of consistent advertising and are willing to sign multi-year contracts. In contrast, national advertisers typically prefer shorter, six-month agreements, which increases the frequency and effort needed to re-rent the billboard space​ (IBISWorld)​.

Profitability and Reduced Vacancy

Local advertisers generally provide more profitable and stable revenue streams. A consistent $500 per month from a local advertiser for a year is more advantageous than $1,000 per month from a national advertiser for six months, followed by six months of vacancy. The time and resources spent on re-renting space, along with potential financial stress from vacant periods, make local advertisers a more reliable and profitable choice in the long run​ (Grand View Research)​.

Conclusion

While national advertisers may offer higher rents initially, the benefits of local advertisers outweigh them in the long run. The ease of securing local advertisers, higher renewal rates, flexibility in negotiations, longer lease terms, and overall profitability make local advertisers the better choice for billboard owners. Building long-term relationships with local businesses can lead to a more stable and lucrative advertising business.

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.