Distracted by the Return on Investment?


Being lost in a digital world, there is a generation of ad people that tend to forget about traditional forms of advertising—especially billboards. Although billboards, to a younger generation, seem as an afterthought to campaigns, sources show that not only are these outdoors advertising media outlets a vibrant business, but also they are “hot.” In fact, the two largest publicly traded companies, Lamar and Clear Channel Outdoor, have seen almost a 50% increase in the past 12 months (CNN, 2007). For this year, according to TNS Media Intelligence, we can expect overall sales to increase 5.7%. One appeal for billboards is that, although the oldest of the old media, “consumers cannot avoid [billboards] by changing the channel or turning the page” (NYT, 2007).

Over the past 5 years there has been talk on replacing outdoor billboards with digital billboards. While there have been 400 billboards erected nationally already (including one that I see on route 146 every time I drive into Providence, RI), this number is expected to jump to 4,000 in the next 10-years (MSNBC, 2007).

Side note: Printing Industry expert, Frank Cost, offered a traditional means to update billboards without replacing print, in his book The New Medium of Print by describing a “print-on demand” billboard, where a large print head (similar to those in our desktop ink jets) would be mounted on billboards and would be able to print the billboard when needed. (Cost, 2005)

This past December, however, a MN judge upheld the city’s (Minnetonka) right to cut the power to digital billboards that were deemed too distracting to vehicles, as determined by the city council. Many digital billboards change its image every 8 seconds and, especially at night, can seem incredibly bright and distracting (MSNBC, 2007).

While digital billboards seem like the up-and-up, it still does not resolve a fundamental problem of the medium—measuring results. The advertising industry as a whole has tried to quantify the effectiveness of campaigns and show the return on investment for a company’s ad spending. The Traffic Audit Bureau is working hard on pushing the industry to deliver improved information and has set a target date of October 2008 to introduce this system in more than 200 markets nationwide—which could cost the industry $25 million over the next five years (NYT, 2007). If effective, this could increase American ad spending on outdoor media by 4.4%. With digital billboards, the price of entry is lowered, as advertisers are not committed for a 30-day posting—similar to when 20 years ago TV commercials went from the 60-second spot to the 30.

Can measuring billboard effectiveness be linked with digital billboards and RFID technology? Already MINI has utilized billboards that will display a message like, “Hi Kate, Nice Day For Your Convertible.” The billboard has a sensor that reads information from a RFID tag embedded in their car. To go one step further, in 2006 Honda included interactivity where billboards would ask questions, “How is a Honda Element like a platypus?” and give directions to tune to an AM station (Seattle Times, 2007). If all auto manufacturers included a standard RFID chip in cars, with information based on the consumers, could we then track the demographics of the billboard and cross-reference that to databases based on consumer’s actions?

Is this a future of measuring advertising effectiveness in billboards? Should it be? Could “The Man” use it to catch us speeding? Thoughts…Pros and Cons…?

Additional Resources: