Introduction:

JC Decaux is a French outdoor advertising company, and is the

leader on his market. (The second in the world and the first in
Europe and pacific Asia in term of communication outside)

It is the inventor of the concept of street furniture in 1964.

JCDecaux is the leader of cycle in self service in the world.

Actualy, the company operates in more than 56 countries and is

compose with more than 10 000 employees, and his principals
competitors are Clear channel and CBS Outdoor.

Provides outdoor solutions for advertising, and street furnitures,

especially bus stop advertising system, benches and signage,
columns bins, integrated services, modern Anisette public toilet...

Provides advertising solutions for airports, like digital airports panel,

zonal beacons, interactive sheets, advertising on gateways...

Provides innovative advertising for his clients in the city, with

innovative concepts, original supports.

Provides custom-made outdoor solutions (with an original concept),

like electroluminescence ads, neonlight, glass clings, magic mirror,
polling station, showcase, show screen, touchscreen, upstares
media, floor projection, Mobil campaign, special builds. JCDecaux
touch more than 300 000 people every day all around the world
thanks to a unique network outside support of communication.

The company has realized a turnover of 2350 million of euro in

2010.

The group possesses three business units:

The street furniture( 1st in the world)

Transport(1st in the world)

Billboard( 2nd in the world)

The group is divided in different jobs:

 Technique

Sales & marketing

Administration & direction

Contract relations

R&D

Objectives of JCDecaux:

The strategy of the group to maintain its position on the market consists
on three important actions:

Follow the intern growth by gaining new advertising contracts in local,

subways, airport most frequented and the most attractive.

Strengthen its position on the market thanks to the multiplication of

acquisitions to keep the position of leader or gain market share.

Optimize the commercial potential and the profitability of its advertising

networks in all the countries where the group exercises its activities

Historical Development

1964: JC Decaux invented the concept of street furniture (public services

with advertising) -Lyon free bus shelte

1972: Citylight Information Panels (MUPI) is implemented

1973: Bus shelter in Paris and launching of the first Citylight information
panel.

1980: Automatic toilets (Paris and worldwide)

1881: launch of Electronic Bulletin Boards in order to broadcast messages

in cities (about cultural events, city information)

1988: Advertising panels reunited in one single site.

1992: launch of the multi-service column

1994: creation of automatic toilets accessible to all

1997: Invention of "infobus" (real time information)

1999: Acquisition of Avenir, (n1 worldwide in airport advertising)

2001: launch of displays on plasma screens in airports.

2002: invention of the first generation of self-service bicycles (Austri then

Spain

2003: the first TV media dedicated to passenger/airport relations (Roissy-

Charles-de-gaulle airport),

2004: bus shelter in Japan

2005: launch of the new XBOX 360 in Parisian bus shelters.

2007:self-service bicycle installed in Paris (Vlib').

2008: Dubai International Airports' exclusive advertising contract for 10

years

2009: Mobile device recharging points (JCDecaux Airport and Samsung)

for Paris passengers Airport.

2010: JCDecaux UK bought some asset of the competitor Titan outdoor

(This one is not thus any more a competitor)

Q.1. Identify and discuss Key Issues of the case?

JCDecaux, a vendor of French outdoor advertising space, created a

blue ocean in the advertising industry. It used insight
from noncustomers to challenge the implicit assumptions of the
industry and pulled the mass of once refusing noncustomers into its
market. Before JCDecaux created a new concept in outdoor
advertising called street furniture, the outdoor advertising industry
included billboards and transport advertisement. Outdoor
advertising was not a popular campaign medium for many
companies because it was viewed only in a transitory way.

Especially for lesser-known companies, such advertising media were

ineffective because they could not carry the comprehensive
messages needed to introduce new names and products. Hence,
 many such companies refused to use such low-value-added outdoor
advertising. They were refusing noncustomers.

JCDecaux realized that the lack of stationary downtown locations

was the key reason the industry remained unpopular and small. In
searching for a solution, JCDecaux found that municipalities could
offer stationary downtown locations, such as bus stops, where
people tended to wait a few minutes and hence had time to read
and be influenced by advertisements. JCDecaux reasoned that if it
could secure these locations to use for outdoor advertising, it could
reach beyond existing demand and convert noncustomers into
customers. This gave it the idea to provide street furniture, including
maintenance and upkeep, free to municipalities. As long as the
revenue generated from selling ad space exceeded the costs of
providing and maintaining the furniture at an attractive profit
margin, the company would be on a trajectory of strong, profitable
growth. Accordingly, street furniture was created that would
integrate advertising panels. In this way, JCDecaux created a
breakthrough in value for noncustomers, the municipalities, and
itself.

2. Explain the companys assumptions

In 2002, hoarding can account for quite forty eighth or worldwide outside
advertising expenditures, transport for twenty sixth street piece of furnitur
e eighteen.

JC Decaux believe that the highest three outside advertising firms can acc
ount for half-hour of the market.

In order to gain from offering the free products and maintenance services,
the company got the exclusive rights of displaying advertisements on the
street furniture that had its location in downtown regions. Through making
the advertisements to be available in the city centers, the firm got a lot of
significance by getting incremental exposure time. At the end, the recall
capabilities of the advertising medium were improved. With the
incremental exposure time, the richer contents were permitted and more
sophisticated messages and information could be passed. With the
knowledge that most of the contracts for JC Decaux will expire in a period
of two years, the firm had to engage in stiff competition so as to get many
bids.
3. Conduct a SWOT analysis for the company.

Strength:

American multinational company

High revenue growth

Strong network
Quick international growth

Weakness:
Significant debt
Lack of scale
High notoriety (Brand name)
Leader on the international market
Joint venture with Warner Bros
Fragile brand
Lack of scale
High dependence on the US market

Opportunities:
Alliances and Acquisitions possible on different markets
Emerging markets and expansion abroad
More Innovation possible.

Threats
Intense Competition
Cheaper technology
External changes (government, politics, taxes, etc)
Lower cost competitors
New technologies
Regulations on outdoor advertising

4. Discuss alternative solutions.

In rspons to JCDcauxs xcptional valu offring, th mass of onc

rfusing noncustomrs flockd to th industry. Today, fifty yars latr,
JCDcaux rmains th numbr on global ladr in th strt furnitur-
basd ad markt spac it cratd. Th company now has narly fiv
hundrd thousand strt furnitur advrtising panls in ightn hundrd
citis in forty-ight countris around th world.
It could b stratgic for th company to mak an xtrnal growth in doing
an "acquisition" with local companis. Thr will b advantags for both
companis. JC Dcaux will s his position rinforcd in th Unitd
Kingdom, whr local companis will b bnficial from th knowldg,
and th prformanc in trms of advrtising of JC Dcaux.
Our company is yt implantd on th UK markt but to rinforc its
position w ar going to mak an acquisition with a local company which
owns an important shar of markt: Primsight. To divrsify itslf on th
markt and hav th monopol facd to ClarChannl and CBS Outdoor, 2
important comptitors. W know that it would b complicatd to acquir
Primsight bcaus this company owns alrady to GMT communications,
an important uropan privat group. vn if th stratgy of th group is
to dvlop in buying othr companis and xpanding its capital, w can
propos it an offr to acquir th company "Primsight". If this stratgy
dosn't work, w can mak an intrnal growth in proposing to GMT an
allianc with Primsight. It could b an altrnativ for GMT which could
kp its company and shars its knowldg of th markt with us and w
shar our financial prformanc and human rsourcs. Also, w don't
hav to pntrat th UK markt, an acquisition is not ncssary but it's
bttr to kp th UK markt.

CONCLUSION

JCDecauxs blue ocean strategic move eliminated cities traditional

costs associated with urban furniture. In return for free products and
services, JCDecaux gained the exclusive right to display
 advertisements on the street furniture located in downtown areas.
By making ads available in city centers, the company significantly
increased the average exposure time, improving the recall
capabilities of this advertising medium. The increase in exposure
time also permitted richer content and more complex messages.

The JCDecaux case study highlights that it often takes

noncustomers, not customers, to shed insight on the implicit
assumptions of an industry that can be challenged and rewritten to
create a leap in value for all and new market space.