Netflix May Spend $300 Million to Buy a Billboard Company

This would be the streaming media giant's biggest acquisition to-date

Stranger Things is among the Netflix series that use billboards in its marketing campaign. Netflix
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Brands have a wide variety of ways in which they promote their products. Print media, digital and linear television are considered mainstream marketing channels. But another method of advertising that has proved quite effective over the decades, and one that’s seemingly immune from the changing media landscape, is physical and out-of-home advertising. Especially advertising on billboards.

You can fast forward through commercials on linear TV, leverage ad-blockers when using digital media, but it’s a bit tougher to walk down the street and not notice a massive billboard when it appears in front of you. Physical advertising just gets the job done.

As a result, brands pay billboard companies lots of money to buy space for a specified length of time.

Reuters is reporting that Netflix has offered more than $300 million for the Los Angeles-based billboard company Regency Outdoor Advertising. This would represent Netflix’s most expensive acquisition in company history.

Because, why pay a billboard company to help with your marketing when you can just have one of your own?

“Netflix is a frequent and heavy user in the space,” said Evan Richheimer, CEO of New Tradition Media, another outdoor media company, which competes with Regency. “This allows Netflix to so-called ‘block the box’ on premium sites in one of the most important and desirable media markets in the United States.”

Regency Outdoor is owned by two brothers, Drake and Brian Kennedy. It has billboards across Los Angeles, including the trendy Sunset Strip in West Hollywood, the UCLA campus in the West LA neighborhood of Westwood, and near Los Angeles International Airport (LAX); as well as in nearby Orange County, per the company website.

Netflix is already deeply entrenched in the billboard advertising space. Traveling down Sunset Boulevard in Hollywood, one can see billboard images of Netflix originals. Hit series Stranger Things even used a billboard as part of its marketing campaign for season 2.

Its Netflix is a Joke billboard last September confused some passersby, until it was revealed the streaming juggernaut was behind the campaign.

Netflix is reportedly increasing its marketing spend for its original shows and movies to $2 billion this year as it competes with aggressive streamers Hulu and Amazon Prime, social networks Facebook and Twitter, and traditional media companies, including NBC Universal and The Walt Disney Co.

Reuters reports Netflix is not the only bidder for Regency Outdoor, and there is no certainty that its offer will win.

New Tradition’s Richheimer said his “door remains open” should Netflix or any other streaming company come calling. “That said, we have built a stable business with long term leases and iconic assets and we are in no immediate need to divest any assets.”

Regency Outdoor has not responded to Adweek’s request for comment. Netflix declined to comment.


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@ajkatztv aj.katz@adweek.com A.J. Katz is the senior editor of Adweek's TVNewser.
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