Title: TCRP Project B33:
1- TCRP Project B-33
- Practical Measures to Increase Transit Industry
Advertising Revenues - Findings, Conclusions and Recommendations
- September 2008
2Agenda
3U.S. Advertising Current Situation
- US advertising in a severe slump
- Down 1 in 2007 to 230B
- Down another 3 in 2008
- Important developments in media industry
- Decoupling of advertising and media services
- Advertisers no longer look to one agency to both
develop media plan and develop advertising - Recognition that there are many more media
choices than TV, print, radio - Advent of specialization
- Internet
- Out-of-home
- Direct marketing
4U.S. Advertising Current Situation
- Advertiser trends
- Intense pressure to show results of marketing
spending is driving demand for media that - Can deliver sales and prove it
- Are highly targeted for maximum efficiency and
effectiveness - Can accommodate multiple ads (tailored by
audience) - Can break through the clutter
- Can get in the face of the consumer
- Promote consumer loyalty
- Are easy to change quickly
5Transit advertising revenue down 2 in 2007
2007 Out-of-Home Media Spending 7.2B
3 of Total U.S. Media Spending in 2007 (230B)
Source Outdoor Advertising Association of America
6Agenda
7Conclusions
- Transit advertising has serious image and product
deficiencies, particularly among media
generalists serving local and regional
advertisers - Transit advertisings positioning is neither
highly motivating nor differentiated from
billboards - The level of product innovation is insufficient
- Aside from sales activities, there is no
promotion of the product to its target audiences - The challenges of growing ad sales is greater
among transit agencies not in top 20 media
markets - Transit advertising sales materials are not as
effective as they could be at making the case - The overall level of satisfaction with transit
media sales reps is low
8Media Planner Survey 153 Respondents
- Director-level and above
- Employed by advertising agencies, general media
agencies and out-of-home media agencies, but not
advertisers - Balance of major media agencies (annual billings
gt50 million) and smaller agencies - National distribution
- 20-30 minutes, 100 incentive to participate
9Out-of-home specialists have greatest familiarity
and recommend most frequently
FREQUENCY OF RECOMMENDING TRANSIT MEDIA
FAMILIARITY WITH TRANSIT MEDIA
BB 86
BB 67
Percent of Media Planners
- There is an opportunity among all segments to
increase familiarity, which drives recommendations
Which of the following best describes your
familiarity with transit media, e.g., its
products, benefits, product requirements,
purchasing, etc.? How often is transit media
included in your recommended plan?
10Experience with transit media positive
EXPERIENCE WITH TRANSIT ADVERTISING Agreement
with statement, Ive had a good experience with
transit advertising
11Transits greatest perceived strength Reaching
captive audiences
OF BEST AT VOTES AWARDED TO TRANSIT
Percent of Media Planners
- Other strengths saturating a market, extending
reach and frequency - Not a strength building brand awareness or
building a brands image
Among transit, place-based, billboards,
electronic billboards, television and the
internet, which medium does the best job at
12With the exception of captive audience,
billboards perceived to do everything transit
does, but better
OF BEST AT VOTES AWARDED TO TRANSIT,
BILLBOARD AND PLACE-BASED
Percent of Media Planners
Among transit, place-based, billboards,
electronic billboards, television and the
internet, which medium does the best job at
13Transit seen as supplemental, second tier media
ATTITUDES and HABITS concerning TRANSIT MEDIA
- Over three-quarters of media planners view
transit as supplemental - Over half agree that transit is rarely requested
for inclusion in a media plan
14Image of transit media needs updating and greater
credibility
Fundamental attributes of a medium need to be
higher
HOW WELL EACH OF THE FOLLOWING ADJECTIVES
DESCRIBES TRANSIT MEDIA
Only 1 in 4 find transit media to be innovative
Almost 2/3rds of respondents think transit is
expensive
Not perceived as hip, sexy or intrusive
A positive finding Downscale not as prominent
an issue as expected
Perceptions of clean are very weak
A positive finding being complicated is not a
barrier
15Media generalists with local-regional clients
have poorest image of transit advertising
HOW WELL EACH OF THE FOLLOWING ADJECTIVES
DESCRIBES TRANSIT MEDIA
Percent saying the adjective describes extremely
well or describes very well
16Most important media attributes reliability,
value, targeting, measurement
IMPORTANCE OF MEDIA ATTRIBUTES of media
planners who rated attribute as extremely
desirable or highly desirable
MUST HAVE
REALLY SHOULD HAVE
SHOULD HAVE
NICE TO HAVE
17Transit medias strongest attributes not aligned
with media planners most important attributes
GREEN 0
RED 5
18Billboards performance on important attributes
better than transits
GREEN 3
RED 3
19Preferences for new media point to digital
MOTIVATING POWER OF NEW MEDIA
of respondents saying the new medium would
significantly increase the likelihood of their
recommending more transit advertising to their
clients
20Though comfortable selling transit, two-thirds of
media planners dont disagree that its difficult
to sell
ATTITUDES and HABITS concerning TRANSIT MEDIA
- Only 46 of media planners agree that clients
perceptions of transit media are positive
21Satisfaction with sales reps shows weakness
SATISFACTION WITH TRANSIT MEDIA SALES REPS
SATISFACTION WITH TRANSIT-ONLY SALES REPS
- More dissatisfaction with multi-media sales reps
- Only 42 of planners with multi-media reps could
agree that rep spends as much time on transit as
on other media
SATISFACTION WITH MULTI-MEDIA SALES REPS
22Summary of the Obstacles to Transit Advertising
Growth
- Transit advertisings positioning the benefits
its target audience perceives it to offer is
neither highly motivating nor differentiated from
billboards - Transit advertising has serious image and product
deficiencies - The level of product innovation is insufficient
to generate interest and enthusiasm among media
planners and advertisers - Aside from sales activities, there is no
promotion of the product to its target audiences - Transit agencies not in top 20 media markets face
greater obstacles to growth than those in the top
twenty - Transit advertising sales materials are not as
effective as they could be at making the case - The overall level of satisfaction with transit
media sales reps is low.
23Agenda
24Transit is very well positioned to grow
- Media dollars are shifting out of traditional
media and into alternative forms - Internet is the fastest growing medium, but
out-of-home is the second fastest - Public transit ridership is increasing as fuel
becomes cost prohibitive - Advertisers demand for new and different formats
is whats driving out-of-homes growthsomething
transit could deliver - Advertisers also looking to connect in a more
personal, one-on-one way with consumerssomething
transit does deliver
However, transit advertising has many issues to
address
25Transits positioning is neither highly
motivating nor differentiated from billboards
- Today, transit advertising sits in the shadow of
the out-of-home advertising 800-pound gorilla,
billboards - Transit is seen to have the same uses as BB, but
performs less well across the board - Consequently, 77 of the sample agreed that
Transits best use is as a supplement to other
media - All 3 media planner segments view Reach a
captive audience as transit advertisings
greatest strength, as well as its unique strength - Our judgment and knowledge of media tells us that
this is not a highly sought after media objective - Advertiser trends indicate demand for highly
targeted media, and for media that can break
through clutter, connect one-on-one with
consumers, trigger consumer action
Transit is lacking relevance and distinctiveness
in todays advertising market
26Recommendation 1. Reposition transit to
differentiate it from billboards, elevate its
importance and update its image
- Give transit a compelling positioning in its own
right - Transit has something different from billboards
to offerand just as compelling - Permission to believe
- Transit advertising is at eye levelin stations,
outside stations, on the street, in the cars - Transit advertising can encompass a
consumerwhether they are in a station domination
or an interior-wrapped bus or railcar - Transit media lend themselves to innovative
creative (e.g., bus wraps) - Transit media travelcustomers can confront your
transit ad multiple times during a day, not just
at rush hour - Transit is affordable you can be in your
audiences faces with one campaign after another - Test positioning among target audiences before
launching
Transit media are the mass media that get up
close and personal with your consumers so that
they dont just see, they experience your brand
message.
27Aside from direct selling activities, there is no
promotion of the product to its target audiences
- Many media have industry associations that
focused heavily (if not exclusively) on promotion
of the medium to the advertising world - Promotional tactics include
- Websites for providing news and information
- Events showcasing the mediums best uses to media
planners and advertisers, often in collaboration
with associations of national advertisers - Advertising campaigns expressing the unique value
proposition of the medium - We found no evidence of wide-scale promotion of
the medium to media planners or advertisers
In the highly active and highly competitive media
market, transits diminished presence is a
liability
28Recommendation 2. Promote transit media among
both advertisers and media planners
- Commence national advertising, e.g., in
professional trade journals and on websites - Develop tools to make media planners jobs easier
- Create a searchable directory of transit agencies
with demographic data and advertising sales
contact information - Identify transit agencies in the directory by
audiences reached, e.g., college students, the
elderly, Latinos, etc.
29Recommendation 3. Create a transit media trade
group
- Mission to promote sales of transit media
- Activities, e.g.
- Organize industry events / showcases
- Forge alliances with national advertisers
- Advocate for legal and regulatory changes to
permit new product development - Ease access for media planners
- Develop national marketing and communications
strategies - Organize and promote multi-transit agency
offerings, e.g., transit agencies that serve
college populations or senior populations
30Transit has serious image and product deficiencies
- Most fundamental attributes perceived weakly
- Efficient only 38 said this describes transit
advertising - Effective only 58 said this describes transit
advertising - Reliable only 50 said this describes transit
advertising - A good value for the money only 37 said this
describes transit advertising - Image perceptions especially weak among media
generalists with local-regional advertisers as
clients - Having audience measurement, demographic data,
the ability to demonstrate that what was bought
was actually delivered are all must haves for
media planners - Transit perceived to not deliver on any
31Recommendation 4. Develop a credible audience
measurement system
- Develop an audience measurement system to address
weak perceptions of efficiency, effectiveness,
value, reliability - In the short term, conduct a series of market
research studies to explore/prove transits
effectiveness - Multi city
- Multi media (buses vs trains vs stations, etc)
32The level of product innovation is insufficient
- Advertisers demand venues that are new, exciting,
fresh so that they can make a statement with
their choice of medium - Perceptions of transit advertising as innovative,
fresh, exciting are low - The product innovation ideas in the ASCs
pipelines are not among media planners most
highly rated ideas. - Transit agencies indicate willingness to try new
media - However, advertising sales contractors perceive
many transit agencies to not be fully aligned
with this objective - We want to come in and show transit authorities
additional revenue opportunities, but theyre not
so interested its the difference between an
entrepreneurial/creative business and a
government bureaucracy.
33Recommendation 5. Introduce digital and
interactive (experiential) technologies to
transit advertising
- Get ASCs to collaborate on expediting the
introduction of new media to transit - Address alignment issues within transit agencies
- Appoint a director of new business development
within the transit agency whose entire
responsibility is driving higher advertising
sales - Alert general managers that their attention will
be needed in a timely manner - Explore incentives, e.g., rewarding the
department driving business development with
bonuses or extra spending if goals are reached - Address obstacles/disincentives to new product
development in the ASC-TA contract structure - Forge a collaborative effort between ASCs and
TAs to bring about legislative/regulatory
changes needed to permit digitals use on transit
34Transit has serious image and product
deficiencies - more
- Less than 1 in 10 respondents describe transit
advertising as clean - Only 1 in 5 respondents perceive production costs
to be reasonable - Less than half think that transit media offers
flexible flighting - Slightly more than half think that its easy to
do a multi-city buy in transit advertising - More than half think that advertisers
perceptions of transit advertising are negative
35Recommendation 6. Address transits other
product and image deficiencies
- Re-position and promote transit advertisings
benefits - Disseminate examples of best-in-class creative
(ads) used in transit - Further explore extent of negative advertisers
perceptions to better inform media planners - Further explore perception of high production
costs so that it can be addressed - In communications
- By introduction of cost-lowering technologies
- Put additional focus on keeping transit ads and
their environs clean and well maintained
36The challenges of growing ad sales is greater
among transit agencies not in top 20 media markets
- General estimates are that 40 of transit media
is purchased by national advertisers and 60 is
purchased by local and regional advertisers - National advertisers generally want only top 20
media markets - It is more or less up to the media planners
working with local and regional advertisers to
drive ad sales growth for transit agencies
outside of top 20 markets - This study shows that media planners whose
clients are local and regional advertisers have
the least favorable image of transit advertising - This group is the least enthusiastic and most
skeptical. Most of all, because they are working
with the smallest budgets, they need to be
convinced of transit advertisings value for the
money.
37Recommendation 7. Develop specific strategies to
promote ad sales of transit agencies outside top
20 markets
- Arrange individual meetings with media planners
serving local and regional clients - Advertising sales contractor and transit agency
do meeting together - Tailor marketing pitch using each segments
specific beliefs and attitudes about transit
advertising, as outlined in this study - Use new positioning and market studies to change
media planners image of transit advertisings
effectiveness - Promote groups of transit agencies that reach
audiences in high demand - E.g., all transit agencies that serve college
towns - E.g., all transit agencies that serve Latino
markets - E.g., all transit agencies that serve senior
markets - Make this information searchable in the transit
agency database
38Transit advertising sales materials are not as
effective as they could be at making the case.
- Media Planners see deficiencies in the sell-in
tools and materials the receive on transit - Media Planners not getting the measurement data
they must have - Many media planners agree that its difficult to
sell transit media to advertisers (21 agree and
45 are on the fence) - We found no evidence of a selling message other
than extends reach and frequency, which is of
value, but not distinct
39Recommendation 8 Arm sales force with
information, research, case studies (and
ultimately, measurement)
- Re-position transit to give it a more compelling
benefit and to differentiate it from billboards - Produce high quality sales materials targeted to
media planners - A brochure expressing the benefits and best uses
of transit, as well as success stories - Evidence of transits effectiveness and
efficiency via a credible research study of
in-market usage - Information on exactly what theyre selling
routes, times, locations for every market - Information on competing out of home media
locations, cost, availability, etc. - In collaboration with media planners, produce
high quality sales materials targeted to
advertisers - To use in direct to advertiser sales
opportunities - For use by media planners in their pitches to
advertisers - Provide media planners with the necessary
information to prepare post-buy analyses to
communicate exactly what was bought
40The overall level of satisfaction with transit
media sales reps is low
- Media planners with multi-media reps are less
satisfied than are planners with transit
advertising dedicated sales reps - 58 either disagree or are on the fence re My
media rep spends as much time selling me on
transit as on other media. - Our research confirmed that the practice of
offering less commission for transit ad sales
than for the sale of company-owned media exists
it is unknown how widespread this practice is
41Recommendation 7 Address the dissatisfaction
with sales reps among media planners
- Establish sales performance measures and hold
ASCs accountable to them - To the extent that they exist, remove financial
disincentives of selling transit for multi-media
reps - Conduct further research to gain more detailed
insights on drivers of dissatisfaction
42Recommendations for the Proposed Media Trade
Organization
- Develop the national transit media advertising
campaign (Recommendation 2). - Provide guidance (e.g., selling messages about
the benefits of transit advertising) for the
development of sales tools and materials to help
sales reps be more responsive to media planners
and advertisers (Recommendation 8). - Commission market research documenting the
effectiveness of transit advertising
(Recommendation 8). - Lead the effort to establish a more effective way
to portray demographic information depicting
transit advertisings audiences (Recommendation
8). - Organize conferences that showcase transit media
to media planners and advertisers and include a
competition showcasing best-in-class transit
advertising (Recommendation 2).
More
43Recommendations for the Proposed Media Trade
Organization
- Lead the effort to develop an audience
measurement system (Recommendation 4). - Develop tools and information for media planners
to make it easier for them to use transit media
(Recommendation 2). - Advocate for legal and regulatory changes
necessary to permit new product development
(Recommendation 5). - Develop package offerings comprising the
advertising space of multiple transit systems
(Recommendation 7). - Charter a work group to develop strategies to
expedite the introduction of new technologies
(Recommendation 5).
44Recommendations for Transit Agencies
- Commit to supporting the internal effort required
to drive advertising sales growth - Management needs to make themselves available for
timely decision-making on such topics as
introducing new advertising platforms (e.g.,
digital) and pursuing lucrative, but possibly
new, opportunities with important advertisers. - Appoint an entrepreneurial advertising director
within the transit agency whose charge is to
drive sales as high as possible, within
reasonable limits. - Decide that the agency can tolerate the degrees
of risk that typically accompany new business
development efforts. - Locally assess the performance of the sales force
and address underperformance as warranted - Set performance targets and hold sales
organization accountable to them - Find a mutually acceptable approach to pursuing
the introduction of new products and technologies
with sales contractors - Require sales contractors to deliver periodic new
product development progress reports along with
business reviews
45Recommendations for Advertising Sales Contractors
- Find a mutually acceptable approach to pursuing
the introduction of new products and technologies
with transit agencies - Provide better sales training and materials and
assess sales incentive structures - Survey clients both advertisers and media
planners on how their needs can be better met - Apply the information in this study to tailor the
sales pitch by type of media planner - Out-of-home specialists are transit advertisings
biggest fans. They just need to be given more
reasons to use transit as frequently as they use
billboards - Media generalists with national advertiser
clients are also big fans of transit. Most
critically, this audience needs to be convinced
of transits effectiveness - Media generalists with local/regional clients, as
we have seen, are the least enthusiastic and most
skeptical. Most of all, they need to be convinced
of transit advertisings value for the money
46Prioritizing Next Moves
47End of Presentation
- TCRP Project B-33
- Practical Measures to Increase Transit Industry
Advertising Revenues - Principal Investigator
- Jane Alpers, Executive Vice President
- Denneen Company, Boston, MA
- jalpers_at_denneen.com
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