'The Hub': Retail Televised

Recently, TNS Media Intelligencereported that total ad spendingin Q1 of 2006 accelerated by 5.2percent as compared with Q1 oflast year. As always, a deeper dive intothe data suggests that there were some"winners and losers."Not surprisingly, internet displayads increased the fastest, posting a 19.4percent gain. Free Standing Insets (FSIs,mostly in Sunday newspapers), meanwhile,were up 18.5 percent. In addition, "outdoor,"until recently considered a "backwater,"increased 11.1 percent — to almost$850.0 million.The "losers" were local newspapers,down 6.1 percent, followed by networkradio and local radio, down 3.5 percentand 1.1 percent respectively. Lest anyonethink that network TV ads are goingaway, they rang up a 12.5-percent gainin spending. (Some observers say thisincrease is in part due to ad spending onthe Olympics that will not happen againfor another two years).These "macro trends" certainly areshaping what is occurring in the mediaworld. But they also may reflect someof the innovative approaches that someadvertisers started to take three or fouryears ago to respond to audience fragmentation.One sector that is particularlyattuned to such changes is consumer electronics(CE) retailers.In fact, Best Buy, Tweeters, CircuitCity and other CE retailers have all addedin-store media networks — particularly indepartments that feature flat panel andHD televisions. Over the past two years,CompUSA, one of the leading CE retailerswith 250 stores, has been experimentingwith a centrally controlled in-store medianetwork.CompUSA's goals were to avoid thefragmentation that is occurring in massmedia, enhance the customer experiencein their stores, and provide their customers with current and relevant informationabout some of their 80,000 products. Atthe end of the day, it was also about gainingsales lifts on featured products.The content featured on the CompUSAin-store system is a mix of informationabout generic products like CPUs or securitysoftware; CompUSA brand-building;and short ads by companies like AMD andSymantec. The concept is to inform and integrated into the media mix, with FSIsfor example, that even bigger gains can beachieved.The CompUSA system was designedand is managed by Play Network, a Seattle-basedcompany that uses music and videoto enhance the shopper experience and todrive sales.In turn, In-Store Media Networks ofDallas, Texas, is responsible for selling allthird-party ads on the system.Diana Gundelfinger, the CEO of IMN,said that AMD has experienced a 38 percentincrease in the sale of the products itadvertises on the system. Symantec hasdone even better, she reports, with a 107percent increase. Gundelfinger admits that"most of the spending is coming from merchandisingdollars now" but she predictsthat "in the next 18 to 24 months ... addollars will start to move to in-store mediaas the larger agencies and their clientsstart to see these types of results."For its part, CompUSA has since extendedits investment in its video networkinto a front-of-store application called"What's Hot," featuring new products ondisplay and 42" video displays for specificprominent programming -- all of it differentfrom the programming airing in otherareas of the store.The key issue for in-store media networksis whether or not ad dollars will startto move to it as money is now moving towardson-line, outdoor and other so called"non-traditional" media. Stay tuned!Terry Scannell is the founder of ipSigns,a solution provider for networked digitalsignage systems. Prior to forming ipSigns,he was a managing director and coo of thecompany that installed and provided contentfor the Nike In-Store network. He hasworked with companies such as Toyota,Intel and Freightliner Trucks.

'The Hub': Retail Televised

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