Despite the enduring presence and power of out-of-home (OOH) advertising in an increasingly digitized world, “How much does a billboard cost?” remains a common query among advertisers and entrepreneurs eager to explore this time-tested ad medium.
Unfortunately, the answer isn’t straightforward, as billboard advertising costs vary and depend on several factors, including location, circulation, size, format, and audience demographics. According to Solomon Partners’ 2023 Media Trends Report, in the U.S., you can expect to pay an average of USD$2-9 per thousand impressions for an OOH bulletin, poster, transit shelter, or digital place-based ad.
This variability in pricing means it’s important to understand just where and when you want to reach people with an OOH campaign before you go to set a budget. OOH inventory is found in cities, roadside, in malls – they’re a part of our daily landscape and provide a level of visibility (and un-skippability) not available to other types of media. So what sort of pricing should you expect for your billboard campaigns when considering ROI? To start, you’ll need to understand a little more about the medium’s specifics and its unique opportunities.
In this comprehensive guide, we unravel the key determinants shaping billboard advertising cost, demystifying concepts like CPM (Cost Per Thousand Impressions) and exploring approaches and tactics to help businesses maximize their return on investment.
What is a billboard? Types of OOH ad formats
Billboards, or large out-of-home ad placements, remain one of the oldest and most iconic forms of advertising, with the first recorded leasing of a billboard dating back to the mid-1800s. In today’s digital-dominated ad space, billboards continue to be a powerful medium for brands to showcase their messages to a wide audience. In fact, research has shown that out-of-home advertisements produce significantly higher ad recall with consumers versus live and streaming television, podcasts and radio, print, and online executions.
Typically found in high-traffic areas like dense city centers or alongside busy streets and interstate highways, these larger-than-life displays come in various formats, each catering to specific marketing needs. By understanding the distinct advantages of each OOH ad format, advertisers can craft compelling campaigns that resonate with their target audience and make the most of this enduring advertising medium in the digital age.
Static billboards
Pros:
- 100% share of voice
- Always on
- Long-term exposure
Static, or traditional, billboards are the classic fixed displays that grace highways, cityscapes, and other strategic locations. These eye-catching structures often feature printed graphics and text, delivering a clear and memorable message to passing motorists and pedestrians.
READ ALSO: Why static billboards thrive in the digital age: Insights for advertisers
Static billboards are popular with big and small brands alike, particularly those with large or all-encompassing target audiences. Since billboards are so highly visible, they present an excellent opportunity for you to reach a lot of people at once, provided you’re not looking to connect with only a very specific niche audience.
And there’s no beating the longevity of a static billboard ad. It would cost significantly more to buy up a comparable amount of ad time on a digital billboard, and that ad time would be split up into many smaller slots. If you want to repeatedly hit the same audience with your message, maybe while they’re back and forth on their daily commute, a static billboard is a great choice. Despite the rising popularity of digital out-of-home advertising (DOOH) in recent years, static OOH remains the dominant format in this space, accounting for 69% of OOH ad spend in the U.S. – proving the enduring value of this iconic media format.
Digital out-of-home (DOOH) billboards
Pros:
- Flexibility to adjust creative
- Support for dynamic ad formats
- Data-driven measurement and targeting capabilities
On the other end of the spectrum, we have digital billboards, which represent one of the fastest growing media sectors in the world. These dynamic displays utilize LED or electronic screens to rotate through multiple ads, allowing advertisers to tailor their messages throughout the day or in response to ambient conditions or data triggers.
Digital billboards also afford the opportunity to get more playful with the format. Through digital, you can explore the possibility of animation and video and even incorporate interactive elements. All of these are effective ways to engage your audience through digital displays. And the bright displays don’t hurt, either. Unlike static billboards, no additional lighting is needed on a dark night. Colorful, eye-catching screens have the power to mesmerize and, more important, get the message across in a big, hard-to-miss way.
Mobile billboards
Pros:
- Extremely versatile
- Highly targeted
- Electronic and digital-friendly
Furthermore, the evolution of technology has given rise to a unique and highly engaging form of billboard advertising: mobile billboards. These mobile units mounted on trucks or trailers navigate busy streets and events, ensuring maximum exposure to potential customers. With their ability to cover a wide area and target specific demographics according to geographic location, mobile billboards offer unparalleled flexibility and impact, allowing you to dynamically refocus your campaign in terms of location and audience.
Since mobile billboards can be either static or digital, they offer many of the same benefits outlined above – plus, the addition of wheels means that your message is no longer stuck in one place. Mobile billboards can go anywhere there’s a road. And geo-targeting helps advertisers strategically plan routes according to campaign goals. So instead of waiting for their target audience to walk or drive by, businesses and brands can proactively take their message directly to them.
Understanding CPM for billboards
In the world of billboard advertising, CPM (Cost Per Thousand Impressions) plays a vital role in determining the cost-effectiveness and reach of an outdoor campaign. It’s a widely used metric that calculates an advertiser’s cost for every one thousand impressions received on a billboard.
Impressions represent the number of times an ad is potentially viewed by people passing by. Essentially, one impression is meant to correspond to one person viewing the billboard one time, making CPM a critical measure of an ad’s efficiency in capturing the attention of its target audience.
To calculate CPM rates for billboards in out-of-home (OOH) advertising, advertisers need to divide the total cost of the billboard campaign by the number of impressions it generates (in thousands). For example, if a billboard campaign costs $5,000 and generates 300,000 impressions, the CPM would be calculated as follows:
CPM = (Total Cost of Campaign / Impressions) x 1000
CPM = ($5,000 / 300) x 1000
CPM = $16.67
Though this is a good illustrative example, in reality, the average CPM for billboards tends to be much lower, especially in comparison to other media. Per a 2022 Solomon Partners report, the average CPM of a static bulletin in the U.S. market ranges between USD$3 and USD$6 per thousand impressions, with the average cost of a digital bulletin climbing to USD$8 on the higher end. Place-based digital inventory is typically a little more expensive, falling between USD$4.50 and USD$9 per thousand impressions, as advertisers often use place-based OOH for contextual advertising to reach specific audiences at specific, often peak, times.
For the sake of comparison, a broadcast TV ad in the U.S. can have a CPM of anywhere between USD$16-45. Online display ads seem like a relative bargain at just USD$0.80-4 per thousand impressions, but digitally fatigued audiences have largely tuned these out in recent years, making ROI a challenge.
Want to dig into OOH metrics a little deeper? Check out this blog post.
Factors affecting billboard pricing
Understanding CPM is crucial for effective OOH campaign planning, as it enables advertisers to evaluate the cost-efficiency of their billboard ads. But there are a number of variables that impact the CPM for billboards, including the location of the billboard, its size, traffic volume in the area, and the type of audience it attracts.
By comprehending the factors influencing CPM and optimizing their campaigns accordingly, advertisers can strike the right balance between cost and reach, ultimately enhancing their ROI on billboard advertising.
Billboard location
It should come as no surprise that one of the major elements that determine the price of a billboard is its location. After all, a prominent and highly visible location constitutes a decisive benefit for your business – the right spot means your messaging can reach thousands.
If a billboard is located in a premium area like an urban center, it’ll likely cost more than it would in other locations. Similarly, a placement installed along a major roadway will affect pricing, too. Also, the side of the road your OOH signage is located on will also have an impact, as the signage will either be directly visible to oncoming traffic or not. Additionally, market saturation might lead to more competitive pricing in areas with a high concentration of billboards as advertisers vie for limited premium spaces.
The “right” location for an ad is going to depend heavily on what is being advertised. While a fast-fashion ad will feel right at home in the heart of Times Square, you wouldn’t likely be purchasing space for the same product along a rural highway.
Billboard sizes
Billboard size matters significantly in pricing. Larger billboards offer more prominent displays and greater visual impact, leading to higher costs compared to smaller ones. Advertisers must strike a balance between size, location, and budget to find the most effective combination for their marketing objectives.
Billboards come in many different shapes and dimensions, but we’ll break them down into basic categories to give you an idea of what to expect:
Spectaculars
These spectacularly large billboards are specially designed to grab attention in high-traffic areas like Times Square.
Common sizes include:
- 20’ h x 60’ w
- 16’ h x 60’ w
Because they’re typically used by large national brands with equally spectacular advertising budgets, they can have custom dimensions and often use special effects to guarantee people will stop and take notice.
While these are, as advertised, spectacularly huge, they can also be spectacularly expensive. Luckily, most businesses probably don’t need something quite this huge to achieve their campaign goals.
Bulletins
The most popular billboard size (and likely the type most people picture when they hear the word “billboard”), bulletins are best suited for large roads and busy highways.
Though not quite as big as a spectacular, they’re still very large and eye-catching—and are available to rent in many more locations around the country.
Standard bulletin sizes:
- 14’ h x 48’ w
- 10’ h x 40’ w
- 10’6” h x 36’ w
Average CPM (according to the OAAA):
- Static: $3-6
- Digital: up to $8
When renting a bulletin, there are considerations beyond size and location—for example, longevity. Bulletins are also large enough that, like spectaculars, they can be customized in eye-catching ways. Just keep in mind that any kind of customization = more time and added installation and design costs.
Posters
If your goal is more targeted advertising, a poster (also called a 30 sheet) or a junior poster (also called an 8 sheet) are both options that are a bit smaller than a bulletin and better suited for smaller spaces and local roads.
While these placements may not be seen by as many people, by being more targeted they can prove more effective in helping you achieve certain campaign goals.
Standard poster sizes:
- 12’3” x 24’6” w
- 6” x 12’ w (junior)
Average CPM (according to the OAAA):
- Static: $2-6
- Digital: up to $7
Billboard traffic count
Another consideration in the pricing of billboard advertising is circulation, since the volume of traffic passing by a billboard (i.e., its traffic count) directly affects its value. This metric tracks the number of passersby exposed to a billboard or out-of-home signage in a specific region or market. Higher traffic counts translate to more impressions and potential customer exposure, making billboards in heavily travelled areas more expensive.
Media owners work with local municipalities and transportation authorities to count the number of cars going by, tracking the circulation rate while considering certain elements. For example, if the vehicle is traveling past the billboard in the morning, it’s typically presumed that the driver is alone in the car as they are likely commuting to work. That means it’s a single view. Many of the newer, more technologically advanced digital billboards also include in-screen data sensors that can help provide a more accurate traffic count and aid in measuring the number of delivered impressions.
Within the industry, innovation and first-party data integration have led to improved measurement and understanding of these metrics, with a growing number of companies and third-party software providers increasingly performing deep analyses to accurately assess any particular billboard’s traffic count and circulation.
Takeaway: Higher traffic counts = more potential customer exposure and typically higher pricing.
Audience demographics
As is the case with many different advertising formats, demographics are going to play a part in the pricing of your signage.
Demographics determine the breakdown of age, gender, purchasing habits and income bracket for potential consumers. Pooling and analyzing these metrics can help advertisers recognize who is more likely to see their ad.
An example of when audience demographics come into play is when you have a billboard that’s positioned near an affluent part of town or in an environment in which a lot of affluent people work. These billboards will be more likely to cost a little more, given that the neighbourhood’s residents probably have higher disposable income.
Takeaway: Attributes of a billboard’s audience demographics that can increase OOH ad pricing include:
- Affluence/higher disposable income
- Strategically positioned to target a specific demographic group
- Demand for proximate audience types
Seasonal demand
The seasonal demand for certain billboards can also influence pricing. For instance, billboards near popular vacation spots might experience increased rates during peak tourist seasons. On the other hand, some advertisers may opt for off-peak periods to secure more cost-effective campaigns.
Additional expenses and considerations
Beyond the base cost of billboard advertising, there are several additional expenses and crucial considerations that advertisers must take into account to execute successful out-of-home (OOH) campaigns.
Billboard design plays a pivotal role in catching the attention of passersby, and investing in captivating visuals and compelling messaging is essential. However, this creative endeavor incurs its own costs, ranging from graphic design fees to high-quality printing expenses. It is vital to allocate a portion of the budget for a professional, eye-catching billboard design that effectively conveys the intended message.
If you decide to go with a static billboard, then production and installation costs are other critical factors to consider when planning your campaign. Crafting a durable billboard that can withstand various weather conditions is crucial for ensuring its longevity and message retention. The production process may involve weatherproofing materials and additional construction expenses to ensure the billboard remains in optimal condition throughout the campaign’s duration.
Additionally, advertisers must carefully review the contract details with the billboard owner or operator, as hidden or unforeseen fees might arise, impacting the overall campaign budget.
Streamline campaign creation & activation to optimize ROI
Maximizing the return on investment is the ultimate goal for any advertising campaign, and billboard advertising offers a powerful avenue to achieve just that. But in the rapidly evolving OOH landscape, mastering the art of campaign creation and activation is crucial to unlocking optimal ROI.
Campaign planning & asset creation
To optimize ROI with OOH billboards, businesses must begin with strategic planning. Thoroughly researching target audience demographics, traffic patterns, and competitor insights will help advertisers identify prime billboard locations that guarantee maximum visibility and engagement.
Crafting compelling and memorable creative content is equally crucial, as it can captivate audiences and leave a lasting impression. By aligning the billboard’s message with the brand’s identity and campaign objectives, businesses can foster stronger connections with potential customers, ultimately enhancing ROI.
Leveraging data to track & maximize impact
Measuring campaign effectiveness is another critical step in optimizing ROI for OOH billboard advertising. Employing tools like unique URLs or dedicated QR codes in the billboard design can help track the response and impact of the campaign. Regularly analyzing campaign performance and adjusting strategies based on the collected data can help fine-tune billboard placements, creative elements and overall messaging to deliver better results.
Additionally, leveraging digital billboards that allow dynamic content changes based on time of day or audience demographics enables advertisers to adapt their messages for maximum relevance, further boosting ROI. And while it’s not, strictly speaking, a prerequisite for running dynamic ads on digital out-of-home billboards, programmatic enablement (pDOOH) gives advertisers additional opportunities to launch dynamic and interactive DOOH campaigns.
Activate campaigns at scale with dedicated OOH tools & software
Beyond its dynamic ad capabilities, digital offers tons of potential for streamlined, self-serve campaign management using software like Broadsign Ads. These tools provide advertisers with full control and flexibility over their campaigns and are handy for developing impactful out-of-home and omnichannel campaigns. Furthermore, buyer-friendly tools like these facilitate the process of running a DOOH campaign, empowering advertisers to go from idea to execution in a matter of hours or even minutes, ensuring a quick, cost-effective turnaround.
Technology is also helping to simplify and streamline the turnaround for static billboards, which continue to depend on labour-intensive buying processes and typically involve a lot of back-and-forth emails and phone calls. With the introduction of dedicated static campaign management software, media owners now have access to things like real-time inventory availability and streamlined scheduling tools, allowing them to create and deliver static billboard campaigns faster, which can also help you save money on overall turnaround costs.
By continuously refining their approach and making data-driven decisions, and by choosing a media partner or DOOH-specific DSP that’s equipped to handle any kind of billboard campaign request, businesses can unlock the full potential of OOH billboard advertising to achieve remarkable ROI and make a significant impact in the market.
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