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Why pay a company to run your ads on billboards across major metropolitan areas when you can just own the company?
That seems to be Netflix’s thinking as it proposes a $300 million acquisition of billboard company Regency Outdoor Advertising, owned by brothers Drake and Brian Kennedy. Considering that’s the cost of about three episodes of The Crown, it seems like a small investment as Netflix prepares to launch For Your Consideration campaigns across Los Angeles and New York City. A billboard ad on Los Angeles’s Sunset Strip, where Regency Outdoor owns many billboards, can cost $140,000 per month, Barry Lowenthal, president of The Media Kitchen, a New York-based media buyer, told Reuters.
Reuters also reports that Netflix isn’t the only company in the running to acquire it.
Regency also owns billboards around Los Angeles International Airport, next to major freeways such as the 101, 110 and 405, near the University of California Los Angeles (UCLA) and in sight of Orange County’s Edison Field, according to the company’s text-heavy website.
While Netflix is spending bundles of cash each year — $8 billion annually, at last count, on a planned 700 original series in 2018 alone — on original content, it hasn’t done much in the company acquisition space. It’s only other acquisition was of comic-book publisher Millarworld last year.
Both Netflix’s content and marketing spends continue to increase. Analysis firm MoffettNathanson wrote in a recent research note that the firm’s expenses per subscriber are expected to jump 25 percent to $16 per subscriber in 2018, up from $13 per subscriber. At the end of last year, Netflix reported it had 117.6 million streaming subscribers around the world, making it by far the world’s largest subscription-video-on-demand provider.