You would think Los Angeles commuters had seen it all. But last May, a 14-story building with a hole in it stopped traffic on the eight-lane 405 freeway. Turns out the patch of sky blue in the center of the office building was an illusion--the latest in outdoor-advertising wizardry. Walt Disney Co., promoting its summer action movie Armageddon, had ordered the mock hole to simulate the path of a meteor. Traffic officials were not amused. Disney took it down.
Outdoor ads are attracting more than commuter attention. The industry that was once the low-rent cousin to network TV and other livelier media is enjoying a renaissance. Lower costs, faster technology, and a surge of creativity have pushed outdoor--that's everything from billboards to bus shelters--into renewed prominence. "It's ironic. Scribbling a message on a wall has to be the very first form of advertising--back to the caveman. Yet here it is again as the latest hoopla," says Jack Irving, media director for Saatchi & Saatchi Advertising Worldwide's New York office.
Indeed, fueled by scorching demand from heavyweight national clients such as Sony and Microsoft, outdoor ad revenues are hitting new heights. With double-digit growth expected this year, the Outdoor Advertising Assn. thinks spending will exceed $2 billion. That will best last year's gains of roughly 9%--and it's leagues away from the 1% boost the industry saw back in 1990.
Much of the gain stems from improved technology, which is allowing outdoor advertising to compete in the frenetic marketing climate of the '90s. As recently as five years ago, companies such as Ackerley Group, a Seattle-based outdoor ad seller, used skilled human artists to create billboard artwork. These days, the biggest players create art digitally. As a result, the time needed to get a campaign up and running on multiple billboards has been cut from a month to days. "That ability has transformed our industry," says Chris Ackerley, vice-president for marketing.
It has also set the stage for an influx of creativity. With designers able to dream up projects that would have been impossible to build a few years ago, a host of head-turning billboards are cropping up in major cities. In New York City, fake fir trees appear to grow out of Poland Spring's billboard. Meanwhile, Dayton Hudson Corp. has purchased a series of exotic boards over the last two years, including one for Valentine's Day candy which wafted a mint scent for blocks in downtown Minneapolis."You can go for the big idea," says Irving. "You can start with an ad and make it an attraction."
BIG NAMES. There's another powerful lure for advertisers: lower cost. Computer printing of outdoor ads has slashed costs by approximately 10%. That's one reason the California Milk Board has run more than 400 billboards to promote the state's cheeses. The costs, says the state's ad agency, McCann-Erickson Worldwide, ran an estimated $5 to $6 per 1,000 viewers--about half what a newspaper ad would cost. Lynne Scott, an associate media director at McCann, says that for $20,000--the cost of a 30-second spot on a Seinfeld rerun--she purchased weeks of publicity with a billboard at the base of the Golden Gate Bridge.
Such advantages are drawing some of the biggest names in marketing. While entertainment companies such as Sony Corp. and ABC Inc. have long used billboards, their spending soared 24.6% last year, to $206 million. And many newcomers--particularly technology companies--are advertising outdoors for the first time. Microsoft Corp. started dabbling in billboards last year to support its brand campaign, "Where do you want to go today?" This year, it launched a 10-city billboard and bus campaign for Sidewalk, its arts and entertainment service.
The lure of billboards is simple: It's one of the few places big names have yet to slap with their logo. America Online Inc. bought its first outdoor ads in August on the sides of New York City buses in an effort to become "ubiquitous," says Marshall Cohen, senior vice-president for brand development.
All of this advertiser excitement has generated a flurry of acquisitions in the outdoor industry as big media companies have gobbled up many of the smaller billboard owners. CBS Corp. and Chancellor Media Corp., the radio outfit controlled by Dallas investment bankers Hicks, Muse, Tate & Furst Inc., have purchased outdoor-ad companies in the past year. Clear Channel Communications Inc. paid $1.15 billion this year for Phoenix-based Eller Media Inc.
COORDINATION. For media moguls, owning billboards allows them to be bundled into a larger package that increases billings. CBS persuaded Pennzoil Co., which has put most of its recent ads on TV and radio, to commit new dollars to buses and billboards. One reason: CBS was able to provide a package deal of network, cable, radio, and newly acquired outdoor space in 11 cities. As a result, CBS boosted its revenues 15%, to $25 million. "If we can tell an advertiser we are likely to get to more consumers by coordinating the approach among radio, TV, cable, and the outdoor market, we can sell them on being that much more effective," says Lloyd Werner, executive vice-president of CBS' cable unit.
That means consumers are likely to see more billboards in the future--in unusual places. Building-wrapping, a la the Armageddon ad, is all the rage in Los Angeles. ABC has plastered hot-dog and coffee-vendor carts in 15 cities with its sardonic promos for the upcoming fall TV season. Online bookseller Amazon.com put ads on trucks and outside rival Barnes & Noble Inc. bookstores in several major cities. Guerrilla tactics? As new marketers and big media companies swarm in, it's inevitable.