Posterscope Worldwide

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Posterscope Worldwide

Cardinal Tower
12 Farringdon Road
London EC1M 3HS
United Kingdom
Telephone: ( +44) 20 7336 6363
Fax: ( +44) 20 7490 4030
Web site: http://www.posterscope.co.uk

Wholly Owned Subsidiary of Aegis Group Plc
Incorporated: 1982 as Harrison Salinson
Sales: £800 million ($1.5 billion) (2004)
NAIC: 541850 Display Advertising

Posterscope Worldwide is the world's leading player in the outdoor (also known as the "out of home," or OOH) advertising media sector. The company provides campaign planning and purchasing services to clients (typically advertising agencies but also direct advertising clients) for the world's billboards, posters, in-transit advertising (such as in buses and trains), and related venues. Posterscope is the leader in most of the markets it serves; in the United Kingdom, for example, the company controls some 42 percent of the country's outdoor market. Originally focused on the United Kingdom, with additional offices representing northern England and Ireland, Posterscope has expanded in the 2000s and is now present in more than 16 countries worldwide, including the United States, France, Germany and other European countries, China, India, and elsewhere in the Asian region. Much of this expansion comes through the restructuring of parent company Carat, itself the main media buying subsidiary of Aegis Group Plc. Under that restructuring, Carat has re-branded many of the outdoor operations of its own globally operating subsidiary network under the single Posterscope name. The company has also grown through acquisition, notably that of airport media specialist PSI in 2003. In 2004, Posterscope posted worldwide revenues of approximatly £800 million ($1.5 billion). The company is led by CEO Anne Rickards and managing director Steve Bond.

Filling a Vacuum in the 1980s

Billboard advertising was a highly fragmented business in the United Kingdom into the 1970s. For the most part, the nation's billboards and other public poster locations, a market collectively known as "outdoor" or "out of home" in the trade, were owned by a large number of companies. Coordinating a billboard advertising campaign, considered part of an advertising agency's responsibility, was a time-consuming effort. This was particularly true for short-term campaigns, which generally remained in place for just days or weeks.

In the early 1970s, three of the largest billboard owners, Mills & Allen, Provincial Poster Group, and More O'Ferrall, joined together to create a new, centralized operation to take over their outdoor media buying needs. In 1971, the partners launched a new company, British Posters. David Harrison and Judith Salinson took charge of the new business and began seeking clients among the country's advertising agencies.

The agencies greeted the idea warmly, and British Posters took off, building up a large clientele across the United Kingdom. Meanwhile, other billboard owners recognized British Posters' successful formula and signed on. By 1974, the British Posters controlled some 80 percent of the United Kingdom's billboards. At the end of the decade, ten of the country's largest billboard owners had pooled their holdings in British Posters. By then, both Harrison and Salinson had left the company. Harrison went to work as a marketing director at a furniture company, while Salinson took charge of outdoor and local media buying for the Leo Burnett advertising agency.

British Posters' control over the outdoor market came under attack in the late 1970s. A number of voices began to criticize the company's control of the market and accused the company of hoarding billboard space. In the early 1980s, the company came under the scrutiny of the British Mergers and Monopolies Commission. In 1981, the commission called for British Posters to be broken up, despite opposition to the move both from the billboard operators and from the advertising agencies themselves.

British Posters was shut down in 1982, marking the first time a company had ever been closed down at the behest of the country's Mergers and Monopolies oversight body. The end of British Posters, however, represented an opportunity to create a new style of media buying and planning business, and a number of companies appeared to fill the vacuum. Many of these companies were launched by advertising groups.

In 1982, Harrison and Salinson came together again, and, joined by fellow ex-British Posters executives Anne Rickard and John Scurfield, launched their own outdoor media planning group, Harrison Salinson. The new partners went to work in much the same way they had under British Posters. The main difference, however, was that, rather than representing the billboard owners, Harrison Salinson now found their clients among the country's advertising agencies.

Harrison Salinson was not alone in the field. The company was joined, and even in some cases preceded, by several major competitors, including Concord, Poster Publicity Limited, and Portland, the latter set up by another former British Posters executive. Nonetheless, the new companies, like Harrison Salinson, filled a definite need in the advertising industry.

With the demise of British Posters, advertising agencies were once again faced with the task of organizing outdoor campaigns for their clients. The task involved a great deal of planning and, more and more, market research in order to provide for effective and appropriate placement. However, because an agency's clients did not always require outdoor campaigns, agencies were reluctant to devote full-time staff to this area. Instead, they preferred to turn over this business to the new specialist companies, which, at the beginning at least, remained independent of agency affiliation. This gave the specialist companies the appearance of remaining impartial in their outdoor placement strategies.

Joining Aegis in the 1990s

By the end of the 1980s, specialist companies like Harrison Salinson had begun to recognize the limitations inherent in their independent status. Linking up with a major advertising agency, or one of the newly appearing media buying companies, provided an opportunity for gaining scale and market share. At the same time, the specialist was guaranteed a client base through the agency's own clients, which also provided an opportunity to include outdoor placement strategy during the planning stages of an advertising campaign. Meanwhile, the specialist was able to continue to seek clients from other agencies.

Harrison Salinson chose this route when, in 1989, it agreed to be purchased by Carat Espace, the media-buying wing of fast-rising advertising agency WCRS, soon to be known as Aegis Group. WCRS had been founded in 1979 in London by several partners, including Peter Scott. The agency grew quickly and by 1984 had listed its stock on the London Stock Exchange. The public offering enabled WCRS to step up its growth, notably through a series of acquisitions in the United Kingdom, the United States, and France.

By the late 1980s, WCRS had branched out from its original advertising base to include public relations, design, and, through its purchase of Carat Espace, media buying. Carat Espace had been founded by Francis Gross in Paris in the late 1960s. Gross had recognized the potential in buying up media space—for example, in newspapers, magazines, and on billboards—in bulk at reduced prices. In turn, he was able to sell the space on to advertising agencies and corporations with their own advertising staff, while retaining profit margins as high as 15 percent or more. Gross also profited from year-end "rebates" that media sellers paid to the company, a legal practice at the time. Gross's idea took off, and revolutionized the European advertising industry before being imported into the United States in the 1990s. In the meantime, Carat quickly dominated France's media buying market.

WCRS paid Gross £64 million for a 50 percent stake in Carat Espace in the early 1980s. In 1984, WCRS acquired full control of Carat Espace. Gross, joined by his brother, and WCRS's Scott, then launched Carat on a massive expansion drive in the 1980s, buying up market-leading media planning and buying companies throughout Europe. By the end of the decade, Carat had moved into some 18 different markets and had a leading 11 percent share of the total media market. Carat counted some 4,000 clients, including such major accounts as Coca-Cola, BMW, Kodak, Walt Disney, Guinness, and Fiat.

Carat's rise, coupled with an advertising industry slump in the late 1980s, encouraged WCRS to exit its other businesses, including advertising, to refocus itself around its core media planning and buying activities. The company then changed its name to Aegis Group in 1990, later complementing its media operations with a market research arm.

Harrison Salinson's decision to join Carat was seen as a delicate choice. On the one hand, the company viewed the move as a means of catching up to outdoor leaders Concord and Portland. On the other, Harrison Salinson risked losing clients. In the end, however, most of the company's clients remained, and Harrison Salinson continued to win new clients independent of Carat. Into the early 1990s, the outdoor group claimed that less than ten percent of its revenues were generated through Carat.

Company Perspectives:

Posterscope is the undisputed market leader in the U.K. outdoor market with billings in excess of £270m, giving us 42% market share. We work for 130 different agencies (of which 11 were in the top 20 spending agencies in 2002) including the three biggest agencies in the country, Carat, ZenithOptimedia and Mediacom. The most obvious benefit of this market clout is our ability to secure the best deals in the outdoor market, providing demonstrable value to our clients, but the scale of our resource also enables us to invest heavily in sector-leading technology, not to mention sector-leading staff. Put these together and you have a level of market knowledge and a depth of experience that you won't find anywhere else in the industry.

Global Network in the 2000s

Harrison Salinson moved into the U.K. outdoor big leagues by 1993 when it won the coveted United Distillers contract, which was previously held by Portland. From there, Harrison Salinson never looked back, and, even after its name change to Posterscope in the mid-1990s, remained the United Kingdom's leading outdoor buying and planning group. Part of the reason behind the company's name change was the departure of David Harrison and Judith Salinson. At that time, Anne Rickard became Posterscope's CEO, a position she continued to hold into the mid-2000s.

Posterscope remained focused on the U.K. market into the early 2000s, becoming the dominant outdoor specialist with a market share of more than 40 percent. The company claimed a client base of more than 130 media agencies, including the top three players, Carat, ZenithOptimedia, and Mediacom. Posterscope's revenues had grown strongly during the 1990s as well, rising from around £20 million in the early 1990s to top £210 million by 2001. In that year, the company named Steve Bond, who joined the company in 1992, to the newly created managing director position.

CEO Rickard was now free to focus her efforts on developing Posterscope's new strategy: that of becoming the global outdoor media champion. At the beginning of the decade, Aegis and Carat decided to launch Posterscope as its international outdoor brand, built on the British agency's model. Posterscope then took over the outdoor operations of Carat's own global subsidiary network.

Posterscope at first focused on building its European network, integrating the former Carat's operations. Posterscope also benefited from acquisitions, such as Aegis's purchase of Outdoor Vision in the United States in 2000, and of HMS in Germany and Lord Media in Poland in 2001. Posterscope also expanded through new development, launching a subsidiary in Italy in 2001, for example. In 2002, the company entered China, and within a year Posterscope had built up a staff operating out of offices in Hong Kong, Beijing, Shanghai, Guangzhou, Chengdu, and Xian.

Posterscope continued its expansion in the mid-2000s. Taking advantage of the development of a new generation of digital outdoor media platforms, the company created a new division, Posterscope Hyperspace, in 2003. The company also adapted to a shift in the outdoor industry towards the broader out-of-home market, which targeted not only the traditional outdoor markets but also other public locations such as airports, buses, and trains. Boosting its business in this area, Posterscope acquired the United Kingdom's PSI in 2004. This move enabled Posterscope to become the world leader in the airport media segment as well.

Posterscope remained in expansion mode into 2005. At the beginning of that year, the company announced that it was entering India by purchasing a 51 percent stake in Percept. Through this acquisition, the company gained access to one of the world's largest populations. By then, Posterscope had become an important element in Aegis's media buying division, posting revenues of more than $1.5 billion.

Principal Competitors

Clear Channel Outdoor; JCDecaux SA; Zenith Optimedia.

Key Dates:

1971:: David Harrison and Judith Salinson lead the launch of British Posters.
1982:: British Posters is dismantled; Harrison and Salinson form Harrison Salinson and are joined by Anne Rickard.
1989:: Harrison Salinson is acquired by Carat Group, by then part of Aegis.
1996:: Harrison Salinson becomes Posterscope.
2000:: Aegis acquires Outdoor Vision in the United States, which becomes part of a new global outdoor strategy centered on the Posterscope model.
2001:: Lord Media, based in Poland, is acquired; the re-branding of Carat's outdoor media operations under the Posterscope name is launched.
2002:: Posterscope sets up its first office in China.
2003:: Posterscope Hyperspace, specializing in digital out-of-home media, is created.
2004:: Airport media specialist PSI is acquired, giving Posterscope the global lead in this market.
2005:: Posterscope enters India through the purchase of 51 percent of Percept.