Potential New Sources of Advertising Revenue

Transcription

1 Los Angeles County Metropolitan Transportation Authority Item # 79 Potential New Sources of Advertising Revenue January 15, 2015

2 Current Contract Metro Board awarded contract in Dec Began Jan.1, 2013; expires Dec. 31, 2015 Currently in first Option Year $63 million guaranteed over those 3 years; $22 million in 2015 All payments to Metro received per contract on time

3 Current Contract (continued) Two years remain at Metro s option; would guarantee $47 million additional Five-year total ( ) would be $110 million

4 Innovative Approaches provision Guaranteed revenue covers traditional bus, train & station ads Contract permits additional advertising with additional revenue to Metro Metro receives 70% of these sales $133,603 generated to date Vendor will describe additional possibilities

5 Grow Advertising revenue Enhance the ridership experience Maintain financial stability STAY OUTFRONT!

6 We are OUTFRONT Proven- Providing transit advertising services since 1938 and in LA since the early 80 s Effective- OUTFRONT currently holds contracts with New York MTA, Washington DC, Miami, Atlanta and Detroit among others Strength- OUTFRONT Media is a publicly traded company listed on the New York Stock Exchange under the symbol OUT

7 What s New and/or possible in LA? Headlight Bus Fronts/Bike Racks Expanded Station Poster Coverage Digital Kiosks Additional Window Coverage Beer & Wine Advertising Mass Transit Media Streamer Naming Rights

8 Headlight Bus Fronts/Bike Racks What s New? Rollout possible as early as Q1 2015; 4 phases of 578 buses each OUTFRONT would incur initial cost of approx. $325,600 70% of ad revenue shared with Metro; annual projection $462,000 25

9 Expand Station Poster Coverage The best poster options currently exist on the Red Line only Advertisers typically look to reach ALL rail riders Expanding those opportunities to the other rail lines will increase ad revenue Initial rollout of 244 structures 26

10 LA Digital Kiosks options What s New? Initial rollout of locations in the TAP Vending Machine environment Greatest opportunities for expansion and the likely availability of access for both power and data These locations would be ideal for a portrait display that would fit within the existing frames Ad sales, way-finding and TAP card assistance 25

11 In early December 2014, OUTFRONT Media announced a partnership with Videri, an emerging digital media company The partnership with Videri instantly adds a technology organization that will support OUTFRONT s new Digital Product Organization

12 Window Coverage What s New? The current contract allows for partial window coverage on bus and no window coverage on rail vehicles Re-evaluate window coverage restrictions that prevent METRO from receiving additional revenue As much as $250k in additional annual revenue to Metro 26

13 Window Coverage 26

14 Beer & Wine Advertising What s New? The existing contract prohibits advertisers from this category. Typical increase in revenue is 3%. Some existing cities that allow beer/wine/alcohol are: Miami NY Atlanta Milwaukee St Louis OUTFRONT would limit the total number of ads in this category 26

15 In a recent METRO rider survey, 52% of LA Metro Rail passengers had a smartphone New Media Options- Mass Transit Media Streamer What s New? Passengers can connect via their mobile device or tablet and view news, movies, Metro information and advertising Enhances passenger experience with Metro. No expense to Metro 25

16 Line Naming Rights Selling Naming Rights to specific lines would include integrating a brand into the name of an existing line System maps and literature Typical terms: 15 to 30 years Current agreements are in place in San Diego and Cleveland 35

17 Station Naming Rights Naming Rights to stations would include integrating a sponsor into the name 7 th St/Metro Center station would now be called the Chase Bank Station at 7 th St./Metro Center Typical terms: 7-10 years 35

18 Diet Coke Mini Can Times Square Click Info Button For More Engage Diet Coke celebrated ambitious individuals with their You re On campaign by dominating the Times Square and West 4 th Street Stations In a first for the NY Subways, Coca Cola partnered with OUTFRONT to set up a sampling area to distribute their new mini cans A joint effort produced by Ignition s event team and Ignite: Innovations Lab an OUTFRONT Media brand generating new ideas, technologies, and formats 35

19 Adding up the potential Bike Racks $400k+ 2 Sheets $300k+ Digital Kiosks $100k+ Window Coverage $200k+ These basic opportunities have real revenue potential of $1M per year to Metro. To get to $1M requires a significant investment on the part of OUTFRONT Media. You have our commitment. Now we need yours.