The Wall Street Journal (paid sub. req.) examines the booming business of outdoor advertising today. In particular, the paper looks at upstart Van Wagner, the nation’s fourth-biggest billboard business.
With cities increasingly passing restrictions, the number of billboards — 168,000 nationwide last year — isn’t keeping up with demand. As a result, rents are rising. A large billboard on the Bruckner Expressway in the Bronx or on Tenth Avenue in Manhattan might go for around $21,000 a month today, compared with about $10,000 10 years ago.
With economics like that, Richard Schaps, Van Wagner’s chairman and chief executive, couldn’t resist getting back into the business. A wily former taxi driver with a tattered hack license to prove it, Mr. Schaps had made a name for himself thinking up innovative ways to carve new advertising space from the urban landscape. He founded an earlier outdoor-advertising company, also named Van Wagner, which pioneered much of the iconic advertising in New York’s Times Square, such as Nissin’s steaming steaming cup of noodles.
In 1997, he sold that company for $170 million to Outdoor Systems, now part of CBS Outdoor. But instead of retiring to the golf course, Mr. Schaps promptly started building a new outdoor business, with the same name, from scratch.
The article explains that Van Wagner’s success is a result of their willingness to hustle and find cracks in local codes–for example, most federal buildings aren’t included in local zoning, which provides an opportunity for Van Wagner to erect $20K/month signs on their sides.
Mr. Schaps says his company goes out of the way to work within the law, fearing tactics that are too aggressive would sully the reputation of the industry and potentially scare away clients. “It’s not the way we should be acting,” he says of the industry. At Van Wagner, “we’re almost entirely legal.”
