The Irish outdoor industry is bracing itself for what is likely to be an extremely competitive tendering process for the contract to run CIE’s outdoor advertising business which could be worth up to €40m to the winner.
It is understood that CBS, JC Decaux, Clear Channel and the incumbent Bravo Outdoor will all be tendering for the business.
CIE’s outdoor business is the largest single outdoor contract in the country and one of the most keenly sought-after. Bravo Outdoor has been handling the business for the past three years. Bravo Outdoor was formed by its Irish management, headed up by James Barry, following the decision by Titan Outdoor to pull out of the Irish market in 2010. Since then the company has worked very closely with CIE management in developing and growing the business although an option of extending its contract by another year appears not to have been invoked.
The contract covers internal and external advertising on all of Dublin Buses, Iarnrod Eireann Dart advertising, Bus Eireann advertising as well as fixed sites at railway bridges and bus and rail stations. It also includes the Transvision screens in a number of train stations. Tender documents published by the state-owned company also mention scope for further opportunities in areas like “commercial promotional activities” and “product sampling.”
Interested parties have to go through a pre-tendering process which closes next week. Invitations to tender will then be issued by CIE in May with the winner expected to be announced at the end of July. The contract duration is not actually specified but according to the tender documents, it is likely to be 3 years with an option to extend for an additional 2 years, or, 5 years with an option to extend for an additional 2 years. However the total duration of the contract will not exceed 7 years.
Industry sources say that the length of the contract is likely to be linked to the amount of investment needed to upgrade some of CIE’s existing advertising infrastructure. According to the tender documents “the successful tenderer will be required to make a capital investment in the advertising plant to update the advertising portfolio which may include conversion to digital and more modern formats.” Precisely how much investment will be required is not known. However sources say it could be as much as €1m. Any company making this level of investment will almost certainly demand that the contract runs to its maximum 7 year term so that it can make a return on its investment.