It is fashionable to say that out of home is a GDP-plus business, that is, that the US out of home business is growing faster than the US economy.   This isn’t true if you compare historic US out of home advertising revenues against the change in the Nominal US Gross Domestic Product.   US out of home revenues have grown slower than the rest of the US economy for the last 30 year, 20 year, 10 year, 5 years  and last year as you can see from this table.

Out of home outpaces US nominal GDP during a healthy economy but lags US nominal GDP over an entire business cycle because advertising and out of home revenues fall sharply in a recession.  Here’s the raw data which compares US out of home revenues (reported by the OAAA) with US nominal Gross Domestic Product.

Does this make out of home a bad business?  Certainly not.  There is limited technology risk, the business is simple and there are regulatory barriers to entry.  How many out of home companies do you know that have gone out of business due to competitive pressure?  It usually takes fraud or excessive leverage to do an out of home company in.  And out of home may grow faster than the US economy in the future by adding digital screens and taking ad spend from other forms of media but that’s a separate post.

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