Quotes of the Day

In Manhattan's trendy Soho district, rock star Lenny Kravitz peers down from an 18-m-wide billboard for Absolut vodka, holding in his outstretched arms what appears to be a digital cable with bottle-shaped plugs. This isn't just the physical manifestation of the vodkamaker's latest hip ad campaign; it's also a display of advanced technology. At the bottom of the sign, Absolut invites passersby to send a text message or enable their Bluetooth cell phones to download a free 4-min. MP3 track where they're standing. "We always try to be edgy and different with our ads, but this time we wanted to go beyond the traditional," says Jeffrey Moran, a spokesman for Absolut, which has a similar sign up on Sunset Boulevard in Los Angeles.

Thanks to the Web, cell phones and applications like Bluetooth and text messaging, one of the oldest ad media is suddenly one of the most fashionable. The world's marketers spent $22 billion last year on out-of-home campaigns, as billboard advertising is called. That's an 8% increase from the year before in both the U.S. and Britain, while growth in places like China and Thailand is in double digits — a pace that makes outdoor the second fastest-growing ad medium after the Internet. And we're not talking just your standard roadside eat at joe's billboard. Today's outdoor ads are everywhere — on waste cans, taxis, bus shelters, phone kiosks, even gasoline nozzles. Intrusive? Perhaps, but some of them are also interactive at your request. And at a time when consumers have become increasingly mobile and increasingly overloaded with information, the outdoor ad industry is touting the billboard, the updated version as well as the old standby, as the last powerful way to reach a mass audience efficiently. "It's a medium where there is no remote control," says Paul Meyer, worldwide president of the $2.7 billion Clear Channel Outdoor, a leading player in the global outdoor arena. "You can't mute it or change the station. You can't turn it off. It's there 24/7."

Technology, in part, is driving the medium's rebirth. Consumers can now download music, play video games, watch movie trailers or custom-design a pair of sneakers and purchase them — all by interacting with outdoor ads. Signs can send a digital coupon to our cell phones, and soon they may even start addressing us by name, as they did in Steven Spielberg's 2002 futuristic film Minority Report. "We're almost there," says Stephen Freitas of the Outdoor Advertising Association of America, an industry trade group. "Outdoor advertising is evolving to a world of two-way advertising very, very fast."

Marketers love the interaction with consumers, and it's easy to see why: the results are immediate and measurable. "For the advertiser, it really turns out-of-home into a direct-response mechanism," says Alasdair Scott of Filter in London, the firm that developed BlueCasting, the Bluetooth-based system used in the Absolut campaign. The rock band Coldplay used BlueCasting last summer to launch its album X&Y. During a two-week period, 20,000 people downloaded video clips and sample tracks directly from posters in London's main rail terminals. Fifty bus-shelter ads in Britain for the movie Alien vs. Predator prompted 500,000 riders to vote for who would win the celluloid battle by pushing a button on the signs. "That's what I call engagement," says Jean-Luc Decaux, a co-ceo of JCDecaux North America.

Entertainment isn't the only thing being advertised on digital signs. When Lancôme launched its new fragrance, Hypnôse, in France last summer on bus-shelter signs, cell-phone users with Bluetooth could download coupons for a sample. The supply ran out in three days. In the fall, British fashion retailer New Look used Hypertags, small electronic devices embedded in billboard panels that sent digital discount vouchers via infrared and Bluetooth, which could be spent at nearby stores. Hypertag counts Procter & Gamble, Ford, Nike and Vodafone as clients. "It tends to be big companies who want to do exciting, above-the-line promotions," says Rachel Harker, one of the company's co-founders. And in Britain the line keeps getting higher, says James Davies of Hyperspace, the innovations division of the London ad consultancy Posterscope. On trial at the company's headquarters: a billboard that changes ads depending on the gender of the person standing in front of it. Davies says the demo gets it right 95% of the time. The billboard as a medium is changing rapidly too, as outdoor agencies transform static boards into digital light-emitting-diode (led) or liquid-crystal-display (lcd) screens that flash new images every few seconds. The dynamic screens allow marketers to fine-tune their messages, depending on the time of day. Lamar Advertising, based in Baton Rouge, Louisiana, has converted 75 vinyl highway boards into digital led displays at a cost of $300,000 to $500,000 each. "Advertisers can change their messages almost instantaneously," says Sean Reilly, Lamar's president and coo. Reilly plans to put up 200 of those smart boards before the end of the year. That time-shift ability has fresh appeal for even the most familiar brands. McDonald's, for example, could advertise an Egg McMuffin in the morning and a Big Mac in the afternoon. "Selling day parts has never been an option for out-of-home advertisers before," says Jodi Senese, executive vice president of CBS Outdoor, which will unveil a network of 75 high-definition lcd subway-station signs this summer in Manhattan. In London since December, led screens have been traveling around the city, mounted on a fleet of 25 buses. Advertisers can update ad messages within 10 minutes, or even match an ad with the neighborhood the bus is passing through. "Once you introduce that kind of flexibility," says Jon Lewen, who is overseeing the effort for Viacom Outdoor, "even those advertisers who traditionally wouldn't consider it do."

Not only are digital displays nimble, but they also allow outdoor ad agencies to sell the same real estate more than once. Since July, in a test campaign in Cleveland, Ohio, Clear Channel Outdoor has had seven large-format led boards, each running seven 8-sec. spots a minute. If the current rate of ad sales continues, Clear Channel's Meyer estimates that the boards will produce revenue of $2.3 million in 12 months. Those seven displays in their static form generated $380,000 last year. "An ad medium that historically has been viewed as cumbersome and slow to react is now as flexible as broadcast," says Meyer.

It's possible that, given the mobile lifestyle of today's consumers, billboards can reach more people more reliably than TV commercials. A survey released by the Association of National Advertisers and Forrester Research last month found that 78% of U.S. advertisers think traditional TV commercials have become less effective. Since TV audiences are so fragmented, insiders argue, outdoor ads are a surer way to reach more people more frequently than other forms of advertising. On average, says Senese, out-of-home signs are seen by 90% of U.S. adults in a given geographic area over a four-week period. And in places where mobile technology has penetrated deepest into the culture, the effects are even more eye-catching. According to research by global ad agency Mediaedge:cia, around 50% of adults worldwide have experienced "new outdoor" ads, a figure that rises to 65% of adults in Singapore and 75% in Hong Kong. In Japan, 30 million phones are equipped with a gizmo for reading QR Code, a tiny two-dimensional bar code commonly found on the front of magazines, which can bounce readers to a website, a competition or discount coupons. Last October in Tokyo, Northwest Airlines blew up QR codes to as large as 10 m in height and put them on billboards for passersby to snap, decode and win air miles in an online contest.

Television execs are not about to give up the game, but on one selling point the outdoor industry is improving: its metrics. How many people see an outdoor ad and when they see it can be tracked much more accurately than ever. Since 1933, the only equivalent of TV's Nielsen ratings for outdoor boards in the U.S. came from the Traffic Audit Bureau (TAB), which counted how many people passed a given sign. That antiquated system worked in local markets but couldn't capture the impact of a national campaign. So the industry has invested heavily in research, recognizing that big-time advertisers are demanding more accountability. Says TAB's president and ceo, Joseph Philport: "We realize the challenge has been not just to deliver the size of an audience that sees an ad but to determine how many in the audience notice it."

Enter Nielsen Outdoor. The research group last fall tested the Npod, a gps-based device about the size of a cell phone, giving one each to 850 consumers as they moved around Chicago for 10 days and counting when they passed 12,500 ad sites. Layering demographic and TAB traffic data over maps of billboard locales, the study delivered the sharpest outdoor ratings the industry has seen. Nielsen found that, on average, Chicagoans pass 66 outdoor displays each day. TAB is conducting its own industry-funded study to measure the likelihood that a person passing an ad will see it.

It's not all that surprising, then, that advertisers such as Unilever, Coca-Cola and McDonald's are reconsidering billboards in their ad mix. "Outdoor now has a place in the media-planning process," says Wally Kelly, ceo of CBS Outdoor. Coca-Cola in the U.S. is back outdoors full throttle this month to advertise its new beverage, Coca-Cola Blak, and its new global slogan, "The Coke side of life." According to senior vice president Katie Bayne, the brand will run ads on the top 10 boards in 28 national markets. Last year she advertised in only 10 markets.

That's not to say new billboard technology is free of challenges. Advertisers and privacy advocates are worried that interactive campaigns could be intrusive. Not everyone wants to be talked to by a billboard. "If somebody starts pinging phones, there's going to be consumer backlash," says Tom Burgess, ceo of Third Screen Media, a mobile-marketing and software consultant. For that reason, the newest high-tech outdoor campaigns invite consumers to opt in, say, by sending a text message. For example, insurance-company Nationwide is encouraging visitors to send in snapshots via a company website. Each afternoon it posts selected photos on the 23-story Reuters billboard in New York City's Times Square. Up the street, Walt Disney World advertises a new theme-park attraction. Send a text message to the number posted, and seconds later your phone buzzes with an sms from Disney asking whether you want further promotions. For now, the advertiser knows only your number. Before too long, though, it could know your name too. Pretty cool stuff — and maybe just a little scary.

• DODY TSIANTAR
• Thanks to technology, one of the oldest ad media is suddenly one of the most fashionable