Out-of-Home Outperforms in Oz and NZ
After less than three years in private ownership, at least one and perhaps both of the two largest out-of-home (OOH) media companies in Australia and New Zealand in terms of revenues are soon to be listed, either directly or indirectly, on the Australian Stock Exchange.
In view of both the impending listing of APN Outdoor and the likely relisting or trade sale of the now acquisition-enlarged oOh! Media, it is timely to examine the revenue performance of the out-of-home (OOH) sector in both Australia and New Zealand over the past decade.
Such an analysis reveals that there has been appreciable over-performance by the OOH sectors in both Australia and New Zealand with each growing more strongly than any of their larger traditional media rivals since 2003.
In Australia, OOH ad revenues increased by 8.4% in FY 2014, which was significantly better than the performance of the broadcasting and print sectors and which was also above the sector’s ten year compound annual growth rate (CAGR) of 6.0% and also its post-GFC CAGR of 3.7%.
Recently the highest revenue growth has been recorded by the two smaller OOH segments of transport and retail, which enjoyed advertising revenue growth of 9.0% and 7.9% per annum respectively over the past three financial years.
Three important drivers of the OOH sector’s over- performance have been: the continuing consolidation of ownership in the industry; the increasing digitisation of the sector’s signage stock and a significant improvement in the measurement and reporting of the medium’s usage and effectiveness.
Although statistics for the OOH sector in New Zealand are both less up-to-date and less comprehensive than they are in Australia, they nevertheless still show that the sector outperformed all larger forms of traditional media over the past ten years.
In the decade between CY 2003 and CY 2013, OOH ad revenues increased at a compound annual growth rate of 4.9%, which was significantly higher than the growth recorded by any other form of traditional media in New Zealand over the same period.
Moreover, OOH has been the only traditional media sector in New Zealand to return to and then exceed pre-GFC revenue levels.
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