The Economics of Everyday Things
00:17:45 · Zachary Crockett, Dan Levi
[00:17:45] S4: Unlike static billboards, which are rented out for set periods of time by advertisers, space on digital billboards is sold in programmatic auctions, much like the ads on websites and in podcasts like this one. Again, here's Dan Levi of Clear Channel Outdoor. [00:18:03] S5: Programmatic advertising is a way of automating the buying and the placement of advertising. You basically set the parameters for your ads. I wanna reach this audience. I wanna deliver this many impressions. I wanna spend this amount of money. I wanna drive this result. And the computers talk to each other. When there's a digital billboard and there's a spot that it's about to change to that doesn't have an assigned ad, what ends up happening in milliseconds is a signal gets sent out to these computers saying, I got an ad here that reaches this type of audience. Does anyone want that? Then a bidding process happens where that spot is auctioned to the highest bidder, and then the ad is dynamically delivered. [00:18:47] S4: So it's less buying a specific billboard on a specific freeway and more sort of tapping a new distributed network of digital ads that could be anywhere that reach a demographic that you wanna reach, and that process is done automatically. [00:19:01] S5: Exactly. [00:19:04] S4: Digital billboards also allow for more creativity.
00:19:04 · Zachary Crockett, Dan Levi
[00:19:04] S4: Digital billboards also allow for more creativity. [00:19:08] S5: You can change your creative based on different times of the day. So you can have a fast food restaurant that promotes breakfast during morning drive, but dinner during evening drive. Hot drink when it's cold outside and a cold drink when it's warm outside. We have advertisers that incorporate sports scores into their creative. You can incorporate news headlines into your creative. All of this happens by having a feed of data that goes into the ad. [00:19:36] S4: This isn't the only way that technology is being leveraged by billboard companies. Traditionally, says Levi, billboards are what's called a one to many advertising medium. You set up in one spot and hope to get recognition through broad exposure to a lot of people. But advertisers increasingly want to reach a more targeted audience, and the billboard industry can help them, thanks to the location tracking data on the apps you use on your phone.
00:19:36 · Zachary Crockett, Dan Levi
[00:19:36] S4: This isn't the only way that technology is being leveraged by billboard companies. Traditionally, says Levi, billboards are what's called a one to many advertising medium. You set up in one spot and hope to get recognition through broad exposure to a lot of people. But advertisers increasingly want to reach a more targeted audience, and the billboard industry can help them, thanks to the location tracking data on the apps you use on your phone. [00:20:06] S5: Every smartphone has a unique identifying number on it. We don't follow individuals. We don't know anything about specific people, but we have the ability to understand the prior behaviors of those devices that we've seen. We look at the composition of the devices that we see going past that billboard. So if you have a coffee shop and you're trying to advertise to people who drink coffee at Starbucks, for example, We could show you two billboards, each of which deliver a million impressions a week, but one of them, half the audience has been seen in a coffee shop, and the other one is only 20%. And all things being equal, the one with half drinking coffee is the right one for you. We try and minimize the inefficiency of buying a Billboard by making sure that the highest composition of those lots of people align with who you're trying to reach.
00:20:06 · Dan Levi, Zachary Crockett, Anna Bager
[00:20:06] S5: Every smartphone has a unique identifying number on it. We don't follow individuals. We don't know anything about specific people, but we have the ability to understand the prior behaviors of those devices that we've seen. We look at the composition of the devices that we see going past that billboard. So if you have a coffee shop and you're trying to advertise to people who drink coffee at Starbucks, for example, We could show you two billboards, each of which deliver a million impressions a week, but one of them, half the audience has been seen in a coffee shop, and the other one is only 20%. And all things being equal, the one with half drinking coffee is the right one for you. We try and minimize the inefficiency of buying a Billboard by making sure that the highest composition of those lots of people align with who you're trying to reach. [00:21:02] S4: These advancements are welcome to advertisers, but billboards aren't without their critics. Since the beginning of the interstate highway system, if not before, people have complained that they're an eyesore. The nonprofit Scenic America has been fighting new billboards for more than 40, and billboards are outright banned in Alaska, Hawaii, Maine, and Vermont. [00:21:28] S6: Not everyone loves a billboard, but most people don't mind them. [00:21:33] S4: In Anna Bager's opinion, billboards are actually some of the least intrusive advertisements in modern society.
00:21:33 · Zachary Crockett, Anna Bager
[00:21:33] S4: In Anna Bager's opinion, billboards are actually some of the least intrusive advertisements in modern society. [00:21:40] S6: Consumers more than ever, I think, have an appreciation of ads that are not interrupting what they're doing in the moment. You're watching television, and it interrupts what you're doing. We're surrounded by signage, but it's really not interrupting our journeys or what we're doing in the moment. It's just kinda there. You see it. You spend time with it. If you don't like it, you don't look at it, and you move on. And, you know, when you're sitting there on the highway in congestion, what else are you gonna do? [00:22:08] S4: Billboards are regulated by the Highway Beautification Act, passed in 1965 by president Lyndon B. Johnson. The act limited construction mostly to commercial and industrial areas and set in place standards for things like sizing and spacing.
00:22:08 · Zachary Crockett, Dan Levi
[00:22:08] S4: Billboards are regulated by the Highway Beautification Act, passed in 1965 by president Lyndon B. Johnson. The act limited construction mostly to commercial and industrial areas and set in place standards for things like sizing and spacing. [00:22:26] S5: That was originally intended to make sure that while billboards are an important part of the economy and the business, that the growth doesn't overtake the beauty of our country, and we don't have billboards every 10 feet along a highway. But then we're also subject to state, local, and individual municipalities, all of whom have signage ordinances. So the best way to illustrate this is most people think of Los Angeles as a city. For us, it's more than 70 different municipalities, each of which have their own signage ordinance. So something that could be allowed on one side of a road, if that roadway is a border into the other municipality, could be disallowed literally across the street. [00:23:06] S4: Companies like Clear Channel Outdoor also have to navigate all kinds of limitations around the type of content that can be displayed on a billboard.