Digital & Dirt
00:08:41 · Bobby Switzer
[00:08:41] S1: Okay. So I'm gonna assume, first of all, LEDs are light emitting diodes, and they either... They produce two things. You put electricity to them, and they either produce heat or light. And when we first started, we were dealing with pretty inefficient LEDs, so it created a lot more heat than it did light. So you had to cram a lot of electricity into the product, and in doing so, you created a lot of heat to get the light that you needed. And there's just some some technicalities in how much light was coming out of those first LEDs. At the beginning, they were somewhere around 5,000, what they call nits, which is a measurement of light. And today, I think they're above 12,000 nits. And so we... Today, we run them at probably 50%, if not less, that heat. And the interesting thing about LEDs, the more they get efficient, the less energy you need to give to them to create more light. Therefore, less heat is generated. And as the product improves, we benefit in that we can run our LEDs less, they become less expensive, and there's less power and less heat. And so all those things really benefit the LED display maker and the user because at the end of the day, it costs less to to generate, less to buy, and they last longer because heat is the enemy of the age of the product. So all those things are happening over the twenty years. And today, I really don't know all the numbers today exactly, but I would say that we're probably at half the amount of of electrical bills that we were demonstrating after twenty years. So we were half of what it was twenty years ago, and the price of electricity has gone up. So it's really a great move for the the display makers.
00:10:56 · Ian Dallimore
[00:10:56] S0: Yeah. So so we talked about the the evolution of technology, how we had pitfalls on the the technical side. I remember in the early days, like in Baton Rouge and Pittsburgh were the first two digital out of home locations. And I actually remember visiting both multiple times, and one of them, obviously corporate offices right across from it. And it's been interesting watching that thing evolve over time. But more importantly, the question a lot of people ask because for billboards it's different. There's a lot of legality that goes into it. There's a lot of loopholes that you have to jump through in each county and each parish. In the beginning, how did you select Pittsburgh and Baton Rouge? Baton Rouge makes sense because our corporate office is there, but why Pittsburgh? And then as it evolved, how did we determine where these very costly at the time locations and and units would go up?
00:11:44 · Bobby Switzer
[00:11:44] S1: Well, we started with Baton Rouge because it was easy in the sense that we were there, and we knew that market, and and legally, we could put one up. But, really, what we did at the beginning, nobody likes change, and this was a big change. So what really we wanted is if a manager called up and said they wanted one and they could demonstrate that they could pay it back, we were anxious to give it to them. So it really... Pittsburgh showed up because Stan Guyer stood up and said, me first. I want it. And we gave him not only that first large digital, at the time, I think that was a 14 by 40. We couldn't even afford the... To do the whole board because it was $500,000 to to the whole board, and then we put a static backlight on the end, and it was just sort of promoting the sign. So we... Just trying to get it in so we can make make some money. And not that we were we were definitely interested in making money, but at the beginning, we were really just... We had a budget, and we'll see what... If we can do it. And the cool part about it is we were able to pay for it all the way through with revenue. And so from day one, I think the first one made money.
00:13:19 · Ian Dallimore
[00:13:19] S0: Wow. And so one of the things that I'm assuming... I know when I came on, we were starting on the marketing side when I was working for Tommy Tieppel, our former CMO, was the reaction of the advertisers. And I know that's one thing that Stan had to deal with is how many slots or spots would be on the panel. So maybe touch on that a bit. I know in the beginning we had upwards of like 20 clients rotating and we were trying to find that happy medium place. What were some of the reactions that you would hear from clients and how did we finally come down to six to eight advertisers that's now standard?
00:13:55 · Bobby Switzer
[00:13:55] S1: Yeah. Those are a few different questions there. First, the slot versus the spot versus day part, all that, I stayed out of that. I felt that that was marketing, and Tommy people, you know, had had a better idea on how that would work in dealing with the customers. They keep me away from the customers. The other part of that is as far as... When we first started, we had done a few bulletins and then decided we wanted to do a network of posters. And Stan stood up and said, I want those too. And so he got those. And at the time, we we were dealing with Daktronics, but we didn't want to have one supplier. At the time, we felt that they were probably the best group at the time. And so the next thing we decided, we'll... We go look at another vendor. And we went out to Las Vegas, and the guys that were putting up digitals left and right out there were YESCO, and they weren't doing any billboards. They were doing mostly big marquees. And so... But they had a good understanding of... Because I thought they were a pretty good team, but most of their boards were done. They were in Vegas out in very dry areas. So they didn't they didn't make it as as waterproof. So we we sent all those units and packed them up and and sent them over to Pittsburgh, and we had some problems with them. But the good part about it is all these companies responded well. You know, if there was a mistake, they stood up and stood behind it and did a great job with us on that. The question I remember now is how did we come up with six and eight slots? And so one of the things that... One of the first boards we put up was in Destin, and the manager there was happy to, you know, get it, and we had no controls on it. You could put as many as you wanted. We let the sort of the market dictate it, and he started to have twelve and thirteen spots. And we felt that if one is good, two must be better, three must be fantastic, but eventually, there's a diminishing return, and we tried to figure out where that was. And what we came up with was six, and I think that that worked, and we found that we could do that. Now, really, there's nine... When we had it, there were nine slots. Three of them were set asides for the city, the county, the state, emergencies, all sorts of things that we would set them aside.
00:16:49 · Bobby Switzer
And we felt that if we didn't and our competitors were not following those rules and they would put up, you know, 10, 15, 20 different advertisers. They would sell them, and they would sell it cheaper than us. But we felt that we were gonna have some integrity in it, and that's how we went to it. As far as going to eight, I don't know all the different guys at the time. I think it was Clear Channel. They had come into the markets a little bit after us and made a huge splash in Cleveland, And they came in and put up, I think, about six to eight of them, and they were running eight slots. And so we got a lot of pushback on going to eight. And what we decided was if that board had an occupancy up at a 100% for so many months, then it could support one more. But if we put digital in the market too fast, we saw occupancy drop and rate drop. And so that's where we were always watching the the line.