Publication: Information Display
April, 2008
By Darrin Friskney
“Build it and they will come” is a classic line from the well- known movie, Field of Dreams. Although it refers to base- ball, the saying also applies to digital billboards. It seems that wherever digital billboards are installed, the advertisers quickly follow. There is good reason for this: advertisers recognize that digital billboards can deliver timely, relevant messages to a mobile audience.
Independent outdoor operators thinking of expanding into the digital-billboard business often have questions about where to start and how to make the move to digital lucrative. There are six strategies that will help you succeed with the new digital-billboard media.
1. Learn How to Compete with Traditional Media.
Digital-billboard message flexibility rivals that of newspapers, television, the Internet, and radio. With digital billboards, there is practically no lead-time needed to change the message or be creative, which allows advertisers to test copy, experiment with designs, and even run short-term promotions.
This opens up an entirely new list of potential advertisers for most billboard operators; those businesses that could not wait weeks to change their message on a vinyl board now can take advantage of digital billboards. These include:
· Department stores advertising sales events.
· Sports teams promoting specific games.
· Real-estate agents advertising specific listings.
· Restaurants promoting time-specific menu items.
· A hardware store promoting snow blowers or umbrellas when storms are forecast.
· Banks updating mortgage rates and loan products in real time.
· Radio stations promoting personalities on the air “right now.”
2. Understand What Messages Are Important to Your Advertisers.
There are several areas that are important to advertisers when talking about digital billboards.
· Digital billboards are more targeted and harder to ignore: Americans spend more time in their cars now than ever before. This translates into less time viewing ads in other media, yet billboard rates remain high. Digital outdoor ads cannot be ignored like television or radio ads that can be skipped over by changing a channel or speeding through them on a DVR. Nor can they be filtered out with a pop-up blocker on the Internet.
· Digital billboards are uniquely flexible: Dayparting is revolutionizing the billboard industry. Businesses can now use digital billboards to target customers with messages that are immediately relevant to them. No other medium can do this as quickly, graphically, and cost-effectively as the digital outdoor media.
· Digital billboards deliver unparalleled responsiveness: Digital billboards can be updated remotely in minutes using software and a high-speed Internet connection, allowing advertisers the opportunity to respond quickly to a changing situation. For example, a hardware store can promote its sale on winter storm approaches. Advertisers can even test messages for timing and impact, and then immediately tweak their billboards for maximum return on investment.
· Digital outdoor is an efficient investment: Digital outdoor is a more efficient investment on several fronts: production costs are significantly less than those for updating vinyl billboards, dayparting can be achieved at a lesser cost than is available through the broadcast media, and the average cost to reach each viewer is extremely competitive with other mass media.
3. Be prepared to justify sharing board time with multiple advertisers.
Billboard advertisers are not familiar with sharing advertising space; however, in every other mass advertising medium, advertisers are sharing “space” with other advertisers. Since digital billboards have the same flexibility and immediacy as these other mass advertising media, they should be thought of in the same way.
4. Determine a reasonable rate to charge for advertisements on your digital billboard.
Because digital-billboard ads have more in common with timely, relevant media, such as television, radio, the Internet, and newspapers, than with vinyl billboards, they should be sold using the same measurement tools.
This includes quoting a cost-per-thousand (CPM) impressions rate, a standard measurement used by print and broad- cast media. This will assure that your billboards are priced competitively.
Depending on traffic patterns, most digital billboards have a CPM of $2.00–$5.00.
5. Determine your potential ROI.
Most billboard operators have locations they consider to be A+ locations. These locations typically command the highest rates and have advertiser waiting lists.
Although these are prime spots for digital billboards, daily traffic counts as low as 15,000 can yield substantial profits.
To determine your potential ROI, first determine how many daily impressions your billboard will generate, multiply by 28 days in each month, and then divide by the CPM factor of 1000. Finally, multiply by your CPM rate. This is what you can charge each advertiser every 28 days. Because each digital billboard can feature 6–8 advertisers at a time, it’s easy to see how quickly revenues can add up.
6. Hire and train the right sales team.
Just as digital billboards more closely resemble cable, TV, and radio than they do conventional vinyl boards, the best- suited sales force for this new medium may have a broadcast or print-media background or are at least be flexible enough to accommodate a new way of selling.
Ensure that your sales associates:
· Fully understand and communicate the benefits of dayparting;
· Can manage the scheduling and trafficking of ads to ensure that dayparted messages are displayed at the right time;
· Understand how to handle large detailed workloads that accompany a six-advertiser-or-more rotation; and
· Leverage contacts in industries not currently represented in your customer list.
Additional details on all these topics plus more tips are available free in “7 Strategies to Simplify Digital Outdoor Sales and Increase Your Revenue” at http://www.watchfire digitaloutdoor.com/strategies2.
Darrin Friskney is Director of Watchfire Digital Outdoor. He can be reached via e-mail at Darrin.Friskney@watchfiresigns.com or by calling 866/949-9282.