INTERNATIONAL: Poster giants defy economic troubles to conquer the globe - Richard Cook investigates the overseas expansion of Europe’s poster specialists

Today, despite alarm bells from Maiden Group about the impending recession, posters in the UK seem to be defying early indicators of a downturn. In fact, posters are growing at the rate of about 12 per cent a year, making outdoor the UK’s fastest growing medium. But that’s only a part of the story. It is overseas where the poster market is really taking off.

Today, despite alarm bells from Maiden Group about the impending

recession, posters in the UK seem to be defying early indicators of a

downturn. In fact, posters are growing at the rate of about 12 per cent

a year, making outdoor the UK’s fastest growing medium. But that’s only

a part of the story. It is overseas where the poster market is really

taking off.



Contractors like the More Group now operate in 22 countries around the

world and sell billboards from San Francisco to Singapore. Outdoor

specialists operate in nearly as many countries, taking the best

roadside and airport sites from Addis Ababa to Anchorage. And still the

urge to expand international operations continues. In July, Poster

Publicity International announced the acquisition of the airport buying

specialist, Airport Media International, from the French group, Havas.

At a stroke, it brought the independent company’s billings to more than

dollars 25 million and represented the first stage of an ambitious

expansion plan in North America. PPI already operates offices in Moscow,

Budapest and Singapore, while a rival company, Portland International,

runs 30 offices in 14 different countries. And this is just the

beginning.



’This move toward internationalism is almost entirely client-driven,’

points out Dennis Sullivan, the chairman of Portland. ’But it does show

that poster companies are confident about the strength of this demand,

because its international expansion represents a considerable investment

for them. We routinely expect a new office to start to break even after

around three years.’



To a large extent, growth up until now has been fuelled by increases in

some of Europe’s faster growing economies. Eastern Europe has been and

continues to be a particularly fruitful hunting ground for UK poster

contractors and specialists. According to this year’s PPI European

Outdoor Review, which looks at 33 markets across Europe, outdoor

revenues across Europe now total dollars 4.2 billion. France remains the

largest single market, with the UK in second place and Germany third,

but most of the extraordinary growth is in central and eastern

Europe.



Russia, where the bulk of outdoor expenditure remains rooted in just two

cities, St Petersburg and Moscow, is already the eighth largest European

market in outdoor with total billings of dollars 140 million last year.

This represented a 25 per cent improvement on the previous 12 months.

Given that there are a further 19 cities in the CIS with populations of

one million or more, there would still seem to be considerable potential

for the medium in such unlikely sounding places as Novogibirsk and

Rostov on Don.



Poland is actually growing even faster - it improved by 100 per cent in

1997 alone, while the Hungarian outdoor market expanded by 30 per cent

and revenues in Slovenia and Slovakia each improved by more than a

quarter.



Further proof of the rich pickings to be had from a global poster

presence came with last month’s creation of a company called Outer

Space. This is a joint venture between Alban Communication - the holding

company of Concord, Blade and Outdor Connections - and the specialist

airport advertising agency, Primesight.



’What we have found is we now need a much greater resource to service

international clients,’ points out Alban’s chief executive, Alan

Simmons.



’So it has made sense for us to team up in order to share development

costs. Outdoor is increasingly an international business and the hard

facts are that you have to be equipped to handle a whole host of

feasibility requests from potential advertisers. That means investing in

sophisticated systems and mapping procedures across a range of markets.

At the moment, for instance, we are being deluged by clients wanting to

know everything there is to know about Sydney in preparation for the

next Olympics, and you have to be able to answer those inquiries in

great detail and within a tight time-frame.’



For the specialists, that has meant considerable investment in new

offices and in the kind of modern computer systems that planners now

take for granted in western markets. For the contractors, it has meant

concentrating on their core strengths. More Group, for example, was a

pioneer of a diversified global acquisition strategy, picking up

companies as far apart as Taiwan and San Francisco in the early 80s.

However, the company’s expensive investment in park-bench signage in

California at that time was not a success. Its return to the US during

this decade has come with its six-sheet format which has enjoyed much

greater success.



’Although the contractor side is now much more international, that isn’t

yet having an effect on the way campaigns are planned and bought,’

points out PPI’s managing director, John Ellery. ’The very fact that the

American company, Clear Channel, bought More Group hasn’t in itself made

its offering international. We still call up Eller, Clear Channel’s US

poster company, rather than attempt to deal with More O’Ferrall in

London, for instance.’



Contractors like JC Decaux have long preached the benefits of a more

integrated international approach. Three years ago, Decaux was able to

post a total of 150,000 panels every week in 13 countries across

Europe.



But even the biggest of the contractors are still not really in a

position to offer a one-stop shop to advertisers across the

Continent.



Although the airport advertising business is, on the surface, a

straightforward medium, in reality it’s a complex undertaking. For

example, the top 15 airports in Europe are run by 13 different

concessionaires. A standard European campaign, including Scandinavia,

can take around 25 different calls to book. There are pockets of

dominance by individual contractors - AP Systeme represents more than 80

European airports including all 62 in France - but no two or three

contractors are yet in a position to offer a truly pan-European

deal.



But the trend for outdoor companies to become global operations is clear

enough. The fact that two bidders, Clear Channel and Decaux, were

prepared to bid for More Group this year shows how potent the

attractions of economies of scale and bulk are. And, of course, the

medium is benefiting from the fragmentation of other media around the

world in much the same way as it is in this country.



’It’s not rocket science,’ points out Neil Aldritt, chief executive at

Primesight. ’Media is fragmenting all over the place and posters are an

easily understood way around that fragmentation. In the UK, all you have

to understand is that the population is 65 million and that an airport

campaign will be seen by 45 million people and cost pounds 35,000.

That’s not difficult and it’s the same story around the world. That’s

the largest part of the appeal.’



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