- Real Estate
- Food & Drink
May 6, 2019
A few years ago, Zach Neugebauer changed his marketing strategy and ended up in a new business venture.
The owner of Year Round Brown moved away from television advertising and shifted his approach to billboards.
“And we had good success,” Neugebauer said. “We really loved how digital billboard messages were local. You wouldn’t DVR through it.”
The marketing approach led him to connect with Doug Muth, who had established O2 Media in 2006 along with other investors before becoming the sole owner.
“I started telling him how much I loved the business, and we decided it made sense to do this together,” Neugebauer said. “So we partnered about three years ago and have grown it a lot.”
The business now is called Book Your Billboard and is the only locally owned company in the outdoor LED advertising space.
It’s also one of few players in the Sioux Falls billboard industry.
The biggest, Lamar Advertising Co., promotes itself as the nation’s leading out-of-home advertising provider, with more than a century in business. Its inventory shows more than 250 billboards in and around Sioux Falls.
Omaha-based CK Outdoor has 43 billboards in the Sioux Falls metro area, mostly concentrated on the interstates.
Book Your Billboard has been steadily growing its presence in the past couple of years, increasing from five to 14 digital billboards, plus seven static ones.
“I saw the potential for growth, and when Zach came on board, we really hit the ground running and started finding spots,” Muth said.
“Realtors found out there was an opportunity to have another person enter the market, so if a lease came due, they would come to us and see if we were interested in providing a proposal. Our whole world opened up at once. Then when you go from five to seven or 10 or 12, your name gets out there, and you’re locally owned, and if you treat people right, good things happen.”
The company offers the newest high-resolution, Daktronics-made billboard, Neugebauer said, including the first back-lit LED board in the state at 26th Street and Marion Road.
“We have a lot of innovative things in place, where owners can upload their ad and control their own schedule,” he said.
“We’ll do it all for them, but customers also want backdoor access and the flexibility to update it as quickly as it takes to send a mass email or do a social media post.”
The company also uses software that allows clients to purchase a rotation package.
“Our inventory is very well balanced. We have boards all around town,” Neugebauer said.
“You can buy specific sites, but what we noticed was that took a lot of medium-sized businesses out of the game. To buy every board every month can be expensive. Now, we have a rotational package that allows you to rotate on our boards for a good, low rate, and that’s really opened the door to attract midsized and small businesses like mine that can have this be part of their budget.”
Many businesses focus on main commuting routes such as 10th and 12th streets and south portions of Western Avenue and Marion Road, he said.
“It’s all about repetition and frequency,” he said. “And we believe the longer the message holds, that makes a big difference.”
Billboard expenditures continue to increase nationwide, he said. Lamar reported $1.63 billion in revenue for fiscal 2018, a 5.6 percent year-over-year increase.
“Companies are saying ‘We can’t spend all our money online,’ so they want to find a localized approach, and it really localizes the message,” Neugebauer said. “We’re seeing a paradigm shift to a local, digital product.”
Opportunities for placing new billboards are limited because of city regulations.
After a permit was issued and a billboard installed in 2014 at 41st Street and Sycamore Avenue, residents in the area complained to the city and prompted a City Council study group to review the issue.
It led to a six-month moratorium on new billboards that started in April 2015 and then the creation of 10 billboard opportunity districts.
Any new billboard must be located in a designated billboard opportunity zone. Within these areas, properties must be zoned commercial or industrial. New billboards must be placed 600 feet from existing billboards.
The blue dots on this map indicate existing off-premise signs, while the purple shaded areas indicate billboard opportunity zones. For a closer look at the map, click here.
Between early March 2017 and the same time in 2019, there were 29 off-premise sign permits issued. Thirteen of those have been built, four were canceled, one expired and 11 have permits but are not yet constructed.
“We receive inquiries,” urban planner Jason Bieber said. “But … roughly one permit is issued per month, and that number will continue to shrink once the opportunity district is full.”
Any additional opportunity districts would need to be created using a rezoning process that would require them to be at least 500 feet from land uses such as single-family residential, a cemetery or a historic district.
“In a way, it’s limited future growth,” Neugebauer said. “Newer parts of Sioux Falls aren’t zoned for billboards. You have to go through a board process, so it’s difficult. And there are big national players that have a big legal team and a lot of capital, so it is harder for a local company to grow. But we’ve been able to do it in kind of a grass-roots way and find the right spots.”
Book Your Billboard is able to take on new clients in part because of its digital-centric approach, which allows multiple business to advertise on the same board.
“The market is definitely moving to digital,” Neugebauer said. “The biggest thing is that the change in the sky re-engages the eyeball. Static billboards are great, but we strongly encourage the message to change every few months. People subconsciously tune it out if they drive by every day.
The company also doubles the spend from any nonprofit.
“It’s just a fun thing we put out there, and it’s been awesome,” Neugebauer said. “A lot of times, they’re working on a limited budget and trying to build awareness. We want to give back to our community.”
Book Your Billboard also recently installed a digital billboard in Tea in the parking lot of Pizza Ranch. It’s a 9-foot-by-32-foot board similar to the back-lit LED one at 26th and Marion.
“Our goal is to have 100 billboards at some point,” said Ryan Simmons, director of sales.
“So we view that as going outside the market. We think South Dakota and surrounding states like Iowa and Minnesota make sense.”
There are plans to add inventory in the city too.
“We want to keep growing,” Simmons said. “We’ve identified five to seven locations in Sioux Falls we think would be good, and we’re exploring getting those in the ground. It starts with working with the landowner and then the city, and the economics has to come together, but we’re always looking for locations.”
It’s not the easiest industry if you’re trying to grow, but a local billboard provider is using new technology and grass-roots efforts to expand its presence in the market.