Podcast Summary: The Economics of Everyday Things — Episode 109: Billboards

Host: Zachary Crockett, Freakonomics Network
Date: October 6, 2025

Overview

This episode of The Economics of Everyday Things dives into the surprisingly vibrant world of billboards — the "world’s oldest advertising medium." Host Zachary Crockett explores how billboards have survived and even thrived in the age of digital advertising, the economics and logistics of their operation, innovations like digital billboards, and the persistent debates about their place in public spaces. Featuring insights from Dan Levy (Chief Marketing Officer at Clear Channel Outdoor) and Anna Bager (President & CEO of the Out of Home Advertising Association of America), the episode uncovers the business, history, and future of these towering roadside advertisements.

Key Discussion Points & Insights

1. Billboards in the Digital Age

• Dan Levy's Entry into Billboards
  • Initially hesitant to leave digital marketing for billboards, Levy embraced the opportunity to modernize the medium.
  • "I originally turned down the interview because who wants to be a billboard marketing guy?...On a second pass, I learned that the job was about trying to help bring the world's oldest advertising medium into the 21st century." — Dan Levy [01:55–02:19]
• Adapting with Technology
  • Billboards are evolving with digitization and data-driven placement, influencing both when and what ads are shown.
  • "If you've ever downloaded an app on your phone...that feed of data helps with decisioning on what you're gonna show on a billboard and when and in what locations." — Dan Levy [03:38]

2. History & Evolution of Billboards

• Origins
  • Billboards trace their roots to traveling circuses and painted posters hundreds of years ago.
  • "Some of the earliest examples...were when a circus started to promote their business by putting up large posters to advertise their traveling shows." — Anna Bager [04:48]
• Proliferation with Automobiles
  • Brands recognized the value in putting messages where people traveled, leading to the boom in roadside advertising.

3. Economics & Scale of the Billboard Industry

• Market Breakdown
  • Billboards are part of the broader $370 billion US advertising market, with "out of home" advertising (billboards, transit ads, etc.) making up $9 billion.
  • The US hosts approximately 350,000 static and over 30,000 digital billboards. [05:30]
  • The industry is dominated by three major players: Lamar, Outfront Media, and Clear Channel Outdoor.
• Why Billboards Thrive
  • "You tend to spend more time with physical signage than...any other form of advertising." — Anna Bager [06:48]
• Ownership and Operation
  • Companies either own land or lease it from private or public landowners, typically paying rent or a percentage of ad revenue.
  • Standard build cost: $100,000+ for a freeway billboard (permits, construction, installation).
  • Many billboards are acquired from smaller businesses in local markets.
• Advertiser Dynamics
  • National and local advertisers alike use billboards, with varying rental periods (from four-week stints to long-term "perm" contracts) and costs ranging from hundreds to hundreds of thousands of dollars.
  • "We have billboards that will cost you hundreds of thousands of dollars to rent for a few weeks, and we have billboards that cost hundreds of dollars." — Dan Levy [11:41]

4. Creative & Logistical Realities

• Design Best Practices
  • Billboard design must be bold, simple, and quick to communicate.
  • "We advise our advertisers on, for example, seven words or less. We recommend that they have one image." — Dan Levy [12:10]
  • "Quick, well designed, clean layout, ideally with copy that is easily understood or clever..." — Dan Levy [12:38]
• Production
  • Transitioned from painted sheets to large-format vinyl printing [13:00]
  • Digital transformation further streamlines creative changes.

5. The Digital Revolution in Billboards

• Shareability and Irrepressibility
  • Billboards can't be skipped or blocked, creating "public conversation."
  • "You can't skip us. You can't block us. Technology as it advances only enhances our medium." — Anna Bager [17:38]
• Resilience Against Media Fragmentation
  • While consumers self-select traditional and digital media based on identity/politics, billboards reach everyone.
  • "Billboards are very serendipitous...We will expose audiences to messages that they would normally maybe avoid, but they might have liked if they had seen them." — Anna Bager [18:02]
• Digital Billboards & Programmatic Buying
  • Number of digital billboards doubled from 2018–2023.
  • Each digital sign can display multiple ads (typically 8 slots x 8 seconds).
  • Space sold via automated auctions, mirroring online ad practices.
  • "Programmatic advertising is a way of automating the buying and the placement of advertising..." — Dan Levy [19:20]
  • Digital billboards allow for dynamic, data-driven creative: e.g., showing breakfast ads in the morning or updating for weather and sports scores.
  • "You can have a fast food restaurant that promotes breakfast during morning drive, but dinner during evening drive... All of this happens by having a feed of data that goes into the ad." — Dan Levy [20:25]

6. Targeting & Analytics

• Using Location Data from Mobile Devices
  • Anonymous, aggregated data determines which billboards reach the “right” demographic composition.
  • "We don't follow individuals, we don't know anything about specific people... But we have the ability to understand the prior behaviors of those devices that we've seen." — Dan Levy [21:24]
  • Example: A coffee shop can choose the billboard that passes the most coffee-drinkers, minimizing waste.

7. Criticism & Regulation

• Public Pushback
  • Scenic America and others consider billboards eyesores; they’re banned outright in four states.
  • "Not everyone loves a billboard, but most people don't mind them." — Anna Bager [22:45]
• Minimal Intrusiveness
  • Billboards are passive; they don’t interrupt content consumption.
  • "We’re surrounded by signage, but it's really not interrupting our journeys or what we're doing in the moment. It's just kind of there. If you don't like it, you don't look at it, and you move on." — Anna Bager [22:57]
• Comprehensive Regulation
  • Governed federally by the Highway Beautification Act (1965), also subject to complex state and local rules regarding placement and content.
  • "Most people think of Los Angeles as a city. For us, it’s more than 70 different municipalities, each of which have their own signage ordinance." — Dan Levy [23:42]
• Ad Content Restrictions
  • Landowner and community restrictions prohibit certain topics or categories (politics, alcohol, cannabis) near sensitive locations.

8. Lasting Role in Advertising

• Broad Appeal and Measurement
  • Sophisticated data and creative tools have kept billboards relevant to both local and multinational brands.
  • "Having a media environment where you can tell your brand story effectively and creatively, where we also now have the data to help you understand...how is it contributing to your mix? That would be something most marketers should be considering, if not embracing." — Dan Levy [25:33]
• Memorable Billboard Innovations
  • A creative example: "We did a billboard on the Sunset Strip that snowed...snow in Los Angeles would be falling from the billboard." — Dan Levy [26:33]

Notable Quotes & Memorable Moments

• [02:19] Dan Levy: “I learned that the job was about trying to help bring the world's oldest advertising medium into the 21st century.”
• [06:48] Anna Bager: "You tend to spend more time with physical signage than the other forms of advertising."
• [12:38] Dan Levy: "Quick, well designed, clean layout, ideally with copy that is easily understood or clever that will get your attention..."
• [17:38] Anna Bager: "You can't skip us. You can't block us. Technology as it advances only enhances our medium."
• [18:02] Anna Bager: “Billboards are very serendipitous. We're out there in the real world. We will expose audiences to messages that they would normally maybe avoid, but they might have liked if they had seen them.”
• [19:20] Dan Levy: "Programmatic advertising is a way of automating the buying and the placement of advertising..."
• [21:24] Dan Levy: "We don't follow individuals, we don't know anything about specific people, but we have the ability to understand the prior behaviors of those devices that we've seen."
• [22:57] Anna Bager: “You're watching television and it interrupts what you're doing ... We're surrounded by signage, but it's really not interrupting our journeys or what we're doing in the moment.”
• [23:42] Dan Levy: “Most people think of Los Angeles as a city. For us, it’s more than 70 different municipalities, each of which have their own signage ordinance.”
• [25:33] Dan Levy: “Having a media environment where you can tell your brand story effectively and creatively ... seems to me that would be something most marketers should be considering, if not embracing.”
• [26:33] Dan Levy: "We did a billboard on the Sunset Strip that snowed..."

Timestamps for Key Segments

• Billboard Industry Overview: [01:55–03:07]
• History of Billboards: [04:24–05:48]
• Economic Landscape: [06:19–07:29]
• How Billboards Are Built and Operated: [08:03–10:18]
• Advertiser Perspective & Rental Dynamics: [10:41–11:57]
• Design & Production of Billboards: [12:10–13:20]
• Shift to Digital & Programmatic: [17:38–20:17]
• Data, Targeting & Analytics: [20:53–22:19]
• Regulation & Criticism: [22:19–24:23]
• Big Picture & Creativity: [25:12–26:33]

Conclusion

Billboards remain a dynamic, multi-billion dollar sector of the advertising industry, uniquely able to bridge physical presence with digital innovation. Embracing advanced targeting technologies, dynamic content, and shareable, memorable campaign design, the humble billboard continues to be, as Anna Bager says, both “everywhere outside the home” and an integral part of the public conversation. The episode highlights that while digital has transformed the ad world, it has also invigorated this storied medium.