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`DIGITAL TECHNOLOGIES PUT TIME ON
`SIDE OF OUTDOOR ADVERTISING
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`April 11, 2005 01:00 AM
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`https://adage.com/article/news/digital-technologies-put-time-side-outdoor-advertising/102859
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`Samsung Exhibit 1030
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`Don't be surprised if soon the same roadside billboard that showcases a steaming Egg
`McMuffin on the way in to work tempts with a frosty bottle of Budweiser on the
`commute home. The growth in digital technologies is spawning a whole new way to buy
`the world's oldest ad medium: in day parts.
`Sophisticated LED, LCD and digital-ink technologies, which have marketed themselves
`to out-of-home companies, allow fully networked signs to change with the push of a
`button at a remote location. Instead of buying a 30-day spot on a vinyl bulletin,
`marketers are buying the 4 p.m. to 7 p.m. shift-or a share of a continuously rotating loop
`of advertisements, with the ability to change their message every hour.
`This month, outdoor giant Clear Channel will test the waters in Cleveland, unveiling its
`first foray into digital roadside billboards. The launch, of course, follows its much
`publicized New York subway project, in which Clear Channel placed LED screens over
`the entrances to 78 stations.
`Clear Channel will invest between $2.5 million and $3 million for the Cleveland project;
`the subway project, as is the case of many digital media experiments, was underwritten
`by the technology companies involved. Meanwhile, Lamar Advertising, the third-largest
`outdoor group, has in Pittsburgh a fully networked system of digital posters and
`billboards.
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``THE FUTURE'
`While the opportunity to sell ad space in day parts and the potential for TV-like ratings
`exists, the majority of advertisers are venturing into digital outdoor media as a way to
`broadcast multiple, instantly modifiable messages.
`"There's no question in my mind that this is the future of outdoor," said Paul Meyer, CEO
`of Clear Channel Outdoor. "But what we're doing at this point is very carefully trying to
`experiment with a number of pilot projects to determine best how day-parting will work
`for us and for our clients."
`Conservatively, Mr. Meyer estimates Clear Channel will roll out additional digital
`billboards in the top five to 10 markets this year. Both Clear Channel and Lamar's digital
`billboards broadcast static images to accommodate both existing outdoor creative and
`Department of Transportation restrictions on roadside motion video.
`Meanwhile, Viacom Outdoor is sticking with tried-and-true vinyl roadside billboards for
`now-those fixtures routinely enjoy high profit margins-except for its vibrant digital
`displays in Times Square.
`Perhaps leading the way in day-part selling are a handful of smaller out-of-home
`companies that offer advertising in public indoor spaces. One such company, AdSpace
`Media Networks, started off as a software-proprietary company before entering the
`retail-marketing space, powering signs in Niketown boutiques and Federated
`department stores.
`Two years ago it refocused as a media company with fully networked motion-video
`plasma screens in Loews Cineplex lobbies and major Westwood Group shopping malls.
`Every venue's integrated displays are networked via satellite, which allows messages to
`change on a predetermined schedule or instantly as needed.
`"If we were working with a major consumer-package-goods brand whose interest was in
`reaching young adults, we'd propose to run a schedule on weekends and from 3 p.m. to 6
`p.m. weekdays," said John Henderson, AdSpace Media's senior VP-sales and marketing.
`"There's no sense in trying to reach them from 10 a.m. to 3 p.m. while they're in school."
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`AdSpace Media recently signed on Ruth's Chris Steakhouse, which will advertise during
`a 3 p.m. to 7 p.m. day part. It has also worked with broadcast and cable networks on
`"tune-in-tonight" campaigns, including one leading up to the premiere of NBC's
`"Medium." Mr. Henderson, who previously ran CNBC's sales group, notes that he's
`trying to "run this like CNBC ... traffic logs and schedules are very important."
`Mike DeFranz runs Captivate Network, which sells advertising on 5,500 flat-panel TVs in
`elevators throughout the U.S. and Canada. Captivate, he said, opens up a whole new day
`part that out-of-home advertisers have typically shied from: the middle of the workday.
`"If you look at how media has been used, it's typically on the bookends of the day," he
`said. The network can target specific buildings and change creative by day part or day of
`the week. "We know you're coming back to work tomorrow so we can evolve creative,"
`he said. "On day one we say Volvo is a safe vehicle, on day two we talk about its quality,
`day three concentrates on performance, and so on."
`As part of a pilot project in Minneapolis, indoor/outdoor advertising company
`NextMedia Group has installed more than 100 Internet-connected LCD screens in the
`vanity areas of public bathrooms at restaurants and arenas. The test has attracted such
`advertisers as local TV stations, who advertise their evening newscasts during dinner,
`and the Minnesota Lottery, which can change its ads to reflect the most current jackpot.
`right place, right time
`Going digital may allow the industry, which has long yearned for a larger slice of the
`advertising pie, to grow its share at the expense of other day-parted media-most likely,
`TV. According to Outdoor Advertising Association of America, outdoor accounts for 3%
`to 4% of total ad spending; Stephen Freitas, the OAAA's chief marketing officer, thinks it
`could eventually capture 10%. The technology, he says, puts outdoor "at the right place
`at the right time, with other media having problems reaching audiences. ... Outdoor is
`not an on-demand medium. You can't choose to see it, you have to see it."
`Mr. Meyer loves to point out the implications in the macro advertising mix. "All of these
`different media are under pressure because technological advances are threatening the
`old business model," he said. "But think about how technology relates to outdoor. There
`is virtually no advance that threatens our business-at least not for a long, long time."
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`Additionally, the ability to change messages on a dime has cracked open new outdoor
`advertising categories and allowed existing outdoor advertisers to incorporate more of
`their media plan into outdoor. Retailers can use digital outdoor to tout slower-moving
`products or advertise a short-term sale.
`Bill Ripp, Lamar's area field manager for its digital SmartBoards, said financial
`companies in Pittsburgh are broadcasting call-to-action messages where they used to
`only display branding campaigns. Says Clear Channel's Mr. Meyer: "Our greatest
`weakness as an ad medium was not being able to react as quickly as others."
`Digital advertising typically carries higher CPMs than static ones, though the premium
`Clear Channel will charge on its digital billboards in Cleveland has yet to be determined.
`It will shake out by "trial and error," said Mr. Meyer. Mr. Ripp estimated that CPMs on
`Lamar's digital boards run about twice those of vinyl billboards, though it varies from
`case to case. AdSpace Media charges a $2.06 CPM for its indoor digital signs.
`Arbitron, Nielsen Media Research and the Traffic Audit Bureau are all involved in trying
`to create better measurement for the dynamic medium. Nielsen recently wrapped up a
`recent GPS-oriented trial in Chicago, the TAB is adding a "likelihood-to-see" component
`to its indices and Arbitron is working to integrate outdoor into its Apollo project. "To
`me, [digitized outdoor] is like when FM radio came out," said Joan Gerberding, VP of
`Arbitron Outdoor. "It's the next step."
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