A Bigger Pie in the Sky

I was chatting today with a friend about one of the coolest ideas I've seen in a long time - electronic billboards. I'm sure many people disagree with me about how cool they are, especially since the City of St. Paul was recently discussing a moratorium against building additional electronic billboards in the city. Yet despite the complaints against these new signs, you can't deny that they are innovative.

I hadn't thought much about the billboard industry until I saw the first electronic billboard in my area a few months ago. What I have observed since then is that, prior to electronic billboards, there seemed to be only a linear growth potential for the outdoor sign market. As urban sprawl marched on, and suburbs expanded, new billboard sites came available, and as the surrounding area developed, the sites became more valuable.

The truly revolutionary thing about electronic billboards is that they instantly give the companies in this marketplace the potential for exponential growth. Every existing site in the system can now be utilized for 2, 3 or 4 signs, on a rotating basis. This means that companies can immediately grow their revenues even without taking market share, simply because the size of their market pie is now increasing.

The outdoor sign companies can even charge their clients a reduced fee for a rotating sign relative to a static sign. This is great for the advertisers because they can utilize outdoor advertising as part of a more cost effective marketing strategy. And this is great for the sign companies, because even though they might charge less for each client, the total revenues per site could double or triple.

Outdoor sign companies have had some success with rotating signs in some other cities, utilizing a mechanical rotation that puts the physical sign on a series of rotating surfaces, not unlike the letters in the Wheel of Fortune puzzle. Even though there is likely a higher maintenance cost with electronic billboards than with manual rotating signs, and a much higher capital expenditure up front, the ability to design, update and publish content to the electronic signs via a satellite link would be very appealing to both the outdoor sign companies and to their advertisers.

The major objection to electronic billboards is the "light pollution" that they introduce into neighborhoods. I won't deny that this is a legitimate concern for people whose homes nestle up next to a billboard site, and I don't know if there is an easy answer for this problem. This is the primary reason St. Paul was considering a moratorium on adding additional electronic billboards in the city.

Despite the objections, however, it seems inevitable that these electronic billboards will proliferate, since there is so much potential revenue at stake. What really fires me up, though, is not the potential revenue, but the essence of the idea itself. I hope my next major business initiative could have half the potential impact of an electronic billboard - it could give a whole new meaning to the phrase, 'light it up...'.

Light it up...

Rob