Clear Channel Outdoor Holdings (CCO)

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William Eccleshare on the emergence of green shoots for Clear Channel
by Gurjit Degun
Added 4 hours ago
https://www.campaignlive.com/article/william-eccleshare-emergence-green-shoots-clear-channel/1689773

Signs of recovery for outdoor advertising are beginning to appear in town centres.

It’s no big surprise that Clear Channel’s worldwide chief executive wants to forget the financial implications of the coronavirus lockdown as quickly as he can. "[The second quarter has] been one of the toughest outdoor markets," William Eccleshare says.

As lockdowns were initiated around the world over the first quarter of the year, the deserted streets, transport hubs and shopping centres meant that no-one was looking at outdoor sites – a huge blow to the sector.

For Clear Channel, this led to a $25m cut in capital expenditure in Q2; for the year, it expects a 50% cut.

So of course Eccleshare wants to focus on the future and he says there is good news in that the business is "undoubtedly seeing signs of recovery". According to Clear Channel's anonymised data, green shoots have begun to emerge in town centres as the nation continues to work from home.

"What is interesting is that local high streets are massively over-indexing in terms of the speed of recovery, whereas city centres are significantly under-indexing," Eccleshare explains.

"The activity may not be back to normal, but from our data, it's probably running at about 80% of people [out and about in town centres]. That is three times the level of activity that we're seeing in the West End."

It’s a similar picture right across Europe. This means that Eccleshare is positive about the third quarter, which, he says, is "showing pretty good recovery".

With the government announcing last week that people in England can now use public transport for any journey (not just essential ones) and workplaces can welcome back employees from 1 August, where it is safe to do so, the movement in city centres is likely to improve further.

However Eccleshare doesn’t think there will be the same mix of advertisers that the sector had pre-Covid-19. "We are seeing certain categories come back very heavily," he says.

One such sector is automotive. Clear Channel has been running big campaigns for brands, including Vauxhall and Volkswagen, which have been suffering because of the closure of showrooms. "I think people are recognising that the car is actually quite a safe environment to be in," Eccleshare says.

He adds that other "early successes" have been from retailers and brands that want to shout about their return, such as McDonald’s (which also returned to TV last week), Vision Express and Tui.

Eccleshare is also optimistic about other brands returning to outdoor. "I can’t prove this yet," he says. "But I suspect they will come back, it’s simply a question of when."

He points out that the outdoor market had been a growing sector in the traditional media space before Covid-19 hit. "We have stronger audiences, we’re not fragmenting in the way TV audiences are and you can’t fast-forward us," Eccleshare points out. "I can't see any reason why there should be a kind of structural change against that."
Digital out-of-home investments

The impact of the coronavirus outbreak has led to many changes at businesses. For Clear Channel there is the question of how it will continue to invest in turning its sites into digital ones, having had to cut costs so much this year.

Eccleshare insists that the business continues to invest in the transition it began about 10 years ago. "The economics of it make very good sense," he says.

"One of the things that is encouraging at the moment is that advertisers are using the flexibility that digital offers for time-sensitive messaging about recovery, about the return to work and location-specific advertising. So, if anything, I think the crisis has demonstrated the value of digital inventory and will reaffirm our belief in it."

The only downside of the digital sites during the height of the crisis was the fast nature at which any cancellations could be implemented. "But the upside of that is we're benefiting hugely now [as lockdowns begin to ease]."
Supporting staff

The health of the business is not the only thing that Eccleshare has been concerned with. Supporting staff through the lockdown is something that many business leaders have had to adapt to.

"I've lived through several big recessions and worked through many of them but it was quite clear that this was going to be different from anything we've seen before in terms of the potential impact on our people," Eccleshare says.

Since the initial excitement of working from home began to wear off, Eccleshare has noticed that younger members of staff have found not being in the office harder than their older colleagues who are more likely to have the space – much like Eccleshare himself, who is speaking to Campaign from his study.

"The younger members of staff, who were big advocates for working from home, have found it harder than they anticipated and they're keen to get back into the workplace," he explains. "They miss their colleagues, the sociability, the mentoring, the learning from friends and they tend – because they're [earlier on] in their careers – to have smaller places to live."
Returning to the office

The younger staff will then be pleased to hear that Clear Channel is one of the businesses that have started to reopen offices. Eccleshare wants to encourage people to come into the Soho office, where he has been popping in now and then.

He is asking people to go into the office only if they have a specific reason, for example to attend meetings, and maintains that there is no pressure for anyone to do so. Eccleshare thinks that there will be a bigger appetite for people to return to the office once schools reopen.

He adds that the company will likely end up with a hybrid model where there is a lot of flexible working, mainly because there isn’t enough room for all staff to be in the office at the same time while abiding by social-distancing guidelines.

As lockdown measures begin to ease, Eccleshare is confident that the industry will go into 2021 "with momentum" but the question of when it will see a return to pre-coronavirus levels remains unknown.