Billboard Insider just read Signs of Opportunity by Dan Martin, a history of Lamar Advertising from 1902 to 2008. Here are three lessons from Lamar’s history which can help your out of home company .
Bad news can be good news.
In 1908 Charles Lamar was in a partnership with John Coe which included two assets: the Pensacola opera house and a bill posting company which handled the publicity for opera shows. Lamar and Coe flipped a coin to amicably liquidate the partnership. The winner got to chose first. John Coe won and chose the Pensacola Opera House, leaving Charles Lamar with the supposedly less valuable bill posting company. The Opera House closed within 10 years. The bill posting company went on to become Lamar Advertising.
In 1925 L.V. and Charles Lamar were expanding into New Orleans. General Outdoor Advertising, an industry giant “made them an offer they couldn’t refuse”. It would trade billboards in Baton Rouge for Lamar’s dozen billboards in New Orleans. The Lamar brothers thought they were stepping down to a tiny market in the boondocks but the alternative was to get squashed by an industry giant. The acquisition anchored Lamar in a flourishing oil economy with less competitive risk.
Crisis is Opportunity.
Crisis is opportunity. Lamar went on a buying spree in the 60’s when many out of home company owners sold because they thought the Highway Beautification act would put them out of business. When banks refused to rollover Lamar’s debt in the 1980’s the company found a way to retire the bank debt with the first out of home industry high yield bonds – a new source of capital with fewer covenants and easier payment terms than bank financing.
Stick to your knitting.
Lamar focuses on the US roadside billboard business. At one time 30% of Lamar’s revenues came from a neon sign business. The company wisely jettisoned the neon sign business in the 70’s to stay focused on roadside signs. Lamar had an unsuccessful foray into radio and TV in the 1950’s and has stayed away from traditional broadcasting since. Billboard Insider thinks the collapse of the SPAC market – which shelved Lamar’s plans to diversify outside the US roadside billboard business – is a blessing in disguise. Bad news can be good news.
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