Stephen Freitas

Article Summary:

A look at the challenges of defining digital outdoor media, as well as the opportunities it presents advertisers.

Digital Outdoor Technology: Defining Digital Media

May 2006:
Every outdoor industry stakeholder will be affected by the decisions that are currently being made regarding digital outdoor technology. Moving forward, a common point-of-view is required in order to prepare the industry for its reinvention as a 21st century medium. A newly formed OAAA committee has taken on the challenge of defining digital media. It has held several meetings over the past six months and is working hard to establish common ground among outdoor companies and manufacturers involved with deploying networks of digital displays across America.

Chaired by Clear Channel's Michael Hudes, the committee is evaluating a wide cross-section of topics related to digital media that include:

  • State and local regulatory issues
  • Operational standards
  • Sales & marketing initiatives
  • Creative guidelines

Success at the state level is well under way with 42 state DOT agencies allowing the industry to permit changeable message technology. States have agreed to a static message time (typically 6-8 seconds) along with an interval time (usually 1-2 seconds) for the message change. Local communities are a regulatory challenge and OAAA is looking at development of a model sign code for members use.

OAAA recently published a new digital media glossary on its website. A new public affairs brochure outlining the benefits of digital display technology along with model state and local codes is in development. In addition, the outdoor industry foundation, FOARE, is preparing to conduct a driver safety study this fall in partnership with Virginia Tech. The study is intended to show that digital media displays do not pose a driver behavior or safety issue to drivers or communities.

Lamar Advertising was one of the first outdoor companies to employ digital display technology by constructing units in several markets where the company operates. Recently Lamar launched a network of 10 poster-sized and one bulletin LED units in Pittsburgh. Likewise, Clear Channel has just unveiled a network of seven bulletin-sized units in Cleveland along Interstate highways.

The Clear Channel network rotates eight advertisers every eight seconds. In Pittsburgh, Lamar rotates 10 advertisers every six seconds. In both markets the units are sold as separate networks and are not part of the general market bulletin rotation. "The real value", according to Clear Channel's Cleveland GM, Bill Platko, "is in the ability to change message copy immediately." The networks focus on local business advertisements with the potential of an amber alert display/override for emergency uses.

The digital files necessary are very small measuring .693" x 2.4" and 300 dpi. They can easily be emailed and changes can be made instantly. But, there are a few special rules when designing for LED displays. In particular, white backgrounds produce harsh lighting at night.

The committee is currently drafting a set of standard practices that will hopefully lead to establishing an industry-wide platform for digital media. The standards will encompass product codes, front and back office operations and creative guidelines, among other topics. TAB has been asked to develop a plan for measuring digital media.

While new LED technology is capable of producing vinyl-like display results, there are many other digital technologies on the horizon. A process in development, sometimes referred to as digital paper, provides digital rendering of images from a remote source without the use of internal lights.

The promise of digital technology is its ability to transform outdoor advertising into an extremely nimble medium capable of changing copy instantly. Just as computer-painted vinyl has replaced hand-painted wooden sections on bulletins, digital technology may one day redefine the outdoor industry. How fast and how far the changes go will depend on the industry's commitment to the future and a lot of imagination.

Just as brands clamor for a better understanding of audiences, a wave of new consumer products has been introduced making it increasingly difficult to satisfy the demands of advertisers. It appears radio is going on the Web, TV is going onto cellphones, the Web is going on TV and, everything it seems, is moving to video on demand (VOD) or the iPod. According to Nielsen's Bob Luff, media will change more in the next three to five years than it's changed in the past fifty.'

For the past few months, Arbitron has been taking a distinctly unorthodox approach to measuring audiences against the sea of evolving media outlets. Currently the company is recruiting thousands of volunteers in Houston, asking them clip a portable people meter (PPM) to their belts, or to any other article of clothing, and wear it all their waking hours. Ideally the PPM will tell Arbitron exactly what television and radio programming a person was exposed to during the day. Eventually the PPM may also track outdoor viewing.

In all likelihood, the Houston trial will show that people are exposed to far more media and advertising than they think or remember. Arbitron's PPM will never be able to measure how intently a viewer concentrated on media. However, the PPM expands the boundaries of media consumption. That's because it passively registers media both inside and outside of the home including what PPM volunteers are exposed to in bars, airports, health clubs, while traveling on roads, and other places. This is something that has never been done, according to David Poltrack, the head of research at CBS.

While technology that improves measurement will change the media business dramatically, technological advances designed to eliminate some forms of advertising may have an even more profound effect on media over time. New York management and technology consultancy, Accenture, reports that 70% of ads are already being skipped by viewers with digital video recorders (DVR) such as TiVO, accounting for 2% of all TV ads being skipped. That trend is expected to continue as DVR penetration grows from the current 8% of homes with DVR technology to a projected 40% by 2009.

The research also suggests that the impact of DVR, VOD and interactive TV technology will have a much greater effect on the TV business than anyone previously thought. The report says such changes in viewing behavior will exert downward pressure on CPM measures making TV less efficient. At the same time advertisers will have a tougher time reaching a mass audience. These dramatic changes in broadcast viewing trends should offer an enormous opportunity to the outdoor industry with its ability to efficiently reach mass audiences in a content-rich world.

The study underscores that a combination of fragmented television audiences, loss of market share by the big networks to cable channels, and the growth of DVR technology will all contribute to a slowing in the rate of growth of the TV industry. Broadcasters fear the dual impact of ad-skipping and audience fragmentation will prompt major advertisers to shun television in favor of more targeted forms of media, like outdoor advertising. Research by CBS surveyed 1,200 people and found 75% of them were fast-forwarding commercials.

While it's surely naive to assume television ads will someday disappear, competing media such as outdoor advertising have been presented with a unique opportunity. Capitalizing on the technology that is hurting broadcast can only help outdoor companies. So, the next time you're tempted to skip a TV commercial - don't! Instead, watch the commercial, jot down the name of the advertiser and give them a call the next morning. Make them an offer they can't refuse.

Stephen Freitas has been the Chief Marketing Officer for the Outdoor Advertising Association of America (OAAA), Inc. since 1999. In his role, Mr. Freitas is an industry spokesman who advances the business of outdoor advertising with education and advocacy throughout corporate America. Stephen Freitas joined OAAA after spending 10 years developing high profile marketing programs for Clear Channel Communications and Eller Media Company. As senior vice-president of marketing, Mr. Freitas was responsible for branding, advertising, research, and corporate communications, in addition to being heavily involved with business development initiatives.

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