Bricks rivaling clicks in ad spending
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When Jim McCann, chief executive of 1-800-Flowers.com, wanted to publicise the company’s Happy Hour Bouquet, an oversized martini glass crammed with flowers, last winter, he decided to eschew the web and move the entire ad campaign outdoors.
Until then the online florist had only advertised online, but this campaign took the message to buses, subway stations and across the urban landscape.
Sales in early spring 2006 surged 625 per cent from the Christmas season – traditionally the strongest sales period. And revenues were seven times higher in markets where the outdoor ad campaign was tested.
The company is not alone in stepping outside. With consumers Tivo-ing past television commercials, opting for MP3 players rather than radio, and blocking pop-up internet ads, bricks are starting to look more attractive than clicks to some advertisers.
The Outdoor Advertising Association of America (OAAA), a trade association representing 90 per cent of the country’s outdoor companies, has estimated that outdoor will be a $10bn business within the next five years. Out-of-home expenditures – advertising targeting motorists and pedestrians – surpassed $6bn in 2005, an 8 per cent increase over the year before. “This is one of those times when an industry is at the right place at the right time,” said Stephen Freitas, OAAA’s chief marketing officer.
The number of traditional billboards is rising, but technological advances are spurring growth for the medium too. LED flat screens allow for a number of messages to rotate every few seconds on the same display. This means advertisers can split the high costs of digital boards, which run to $600,000 compared with the $60,000 price cap of traditional billboards.
Changing the sign’s message frequently appeals especially to local advertisers, said Brent McCoy, executive vice-president for business development at Lamar, an outdoor ad company. A restaurant can now advertise a breakfast special during the morning rush hour, lunch specials from 10am-2pm and a dinner special later in the afternoon. Old billboards would display a single advertisement for the entire month it was rented. With the advent of digital screen technology, Mr McCoy said, “We’ve moved from being a non-responsive medium to a very responsive one.”
Clearer screens with high-definition image quality are also appearing, with a new CBS Outdoor installation arriving in New York City this September – 75 units, called “urban panels”, will be placed on the street-level entrances of subway stations. Advertisers have already reserved the spaces for a full year.
CBS Outdoor also announced in June the addition of 2,300 taxi-top ads in Chicago, an advertising space only recently approved by the mayor. In May, New York agreed to the construction of nearly 3,000 new bus shelters, 20 public toilets and 330 newsstands, which are expected to sell up to $1bn of advertising space.
When silent signs are not enough, companies now have the option of more interactive advertising, with Bluetooth-capable and text message-friendly billboards that allow viewers to download songs or video clips and learn more about an advertised product. Doritos, Dove and the band Coldplay were all active in the initial wave of interactive advertising.
But Steven Mueller, president of Outdoor Services, a US out-of-home media management company owned by Interpublic, says that despite these stirrings of a revolution, “we’re still 10 years behind the UK”.
While local advertisers are quick to embrace the new outdoor advertising options, most national companies are not yet showing much interest in message-changing outdoor digital screens. Mr Mueller estimates that national advertisers will not have built digital outdoor into their advertising campaigns for another three to five years.
One reason for such hesitance could be the lack of a uniform way of measuring viewership of the myriad outdoor media. The Traffic Audit Bureau (TAB) is in the midst of creating such a tool but it will not be available until at least next year. TAB has been working on “trying to fix our reputation” for nearly four years, Mr Mueller said, so that adjacent billboards would be forced to list the same circulation numbers. Having calculated the daily effective circulation (base number of viewers in a market), TAB is now studying demographic breakdowns and what information is retained from billboard viewing.
Mr Freitas of the OAAA believes the measurement will be rolled out nationwide within three years. “The industry is becoming much more accountable and measurable, and therefore much more credible,” he said.
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