This is our full transcript of Talk Experiential episode #14: Out-of-Home Marketing 101. You can listen to our podcast episodes on our website, on iTunes, Stitcher, and SoundCloud.
#14 Out-of-Home Marketing 101
JOEY: Welcome back to another Talk Experiential Podcast, Episode #14. Our next guests are both cofounders of Encompass Media, Adam Pierce and Don Winters, based in New York City. Encompass Media Group is a national out-of-home media company. Since 2001, Encompass Media Group has developed a portfolio of products, programs and networks that help advertisers reach their intended audience. With over 20 different out-of-home networks, they provide media options that dwell time and extended exposure helping the brand connect to consumers. Today, we’ll be discussing in-home media and experiential marketing. I’m really excited about this episode and hope you guys enjoy it. If you like this episode, make sure you five-star it and share it with your friends and on social media. Enjoy. All right, welcome back to another Talk Experiential Podcast. Really excited about our guests today. We’ve got two of the co-founders of Encompass Media Group. We’ve got Don Winters and Adam Pierce. Thanks, guys, for joining us.
DON: Hey, thank you so much for doing this tonight.
ADAM: Thank you.
JOEY: Awesome. And you guys are based in New York, right outside New York?
DON: Yeah, we’re based — we’re in New York City and we just moved our offices to Long Island City, which is right outside Manhattan.
JOEY: Awesome. Very cool. I’ve taken that Long Island boat ride. I believe it’s that free one that goes over there.
DON: Yep, the ferry services.
JOEY: Yeah, cool. Well great. Well, Don, if you want to kind of give me a little bit of background of you and then also of the company.
DON: Sure, gladly. I’ve been in the advertising business, basically right out of college. I’ve been doing this for quite a long time. Started off in the publishing sector with newspapers and magazines, and about 16 years ago, Adam and I partnered up. He’ll talk a little bit briefly about himself as well. He has vast experience in the out-of-home states. He’s worked for a lot of major companies in that arena. We teamed up. We were able to migrate some of my clients that we were doing the magazine and move into this field, and Adam as well with the Rolodex of contacts he had, and we came to this whole field of out-of-home with an approach to really make sure that operationally and structurally, we were going to offer things of value to customers that defined our arena to be attractive. When we started this company, there were a lot of people and players in our space, that they didn’t put a lot of energy and effort into making sure programs were running effectively, and our entire focus and, like, laser-sharp focus was really just to make sure if we’re doing programs, it’s got to be done properly and done with the right performance, putting logistics behind it, making sure everybody is GPS tracked and making sure operationally that programs are working very effectively. As a result of that, we’ve gained a lot of credibility in the marketplace. A lot of customers and agencies use us as a go-to when it comes to some of these media forms and, as a result, we’ve had double digit growth every year since inception. I’ll pass the baton to Adam and he can speak a little bit about some of his background.
ADAM: Yeah, I got into this space in the mid 90s. I started with my own restroom advertising company. It was a platform where I was able to learn about the industry, because frankly I didn’t even know what an ad agency was, but I liked the idea that people couldn’t miss your ad when it was above a urinal or in a stall of a restroom. So I ran that business, I sold it, and I wanted to learn more about the industry, so I went to work for a company that was acquired by Clear Channel, and then I went to work for GE Capital for an investment, but they were running an out-of-home, specifically truck side advertising, and that’s when I met Don. As Don indicated, Don had a successful publishing business at the time but wanted to dive deeper into out-of-home and, between our two backgrounds and contacts that we had, we decided to put together Encompass Media. That was, like I said, about 16 years ago.
JOEY: Great. Well, it’s exciting to have you guys on. You guys have a really cool experience on out-of-home. Can you guys kind of dive into, you know, what is out-of-home marketing for the people that don’t know what it is?
ADAM: Sure. I mean, it’s really the last mass media, so to speak, in the sense that, you know, it’s everything from — traditional out-of-home would be considered billboards and transit, things like that. And then you have the non-traditional side, which is really the side we’ve been playing in for the last 16 years, which are, you know, all different ways to reach the consumer at different touch points throughout their day, their week, their month. You know the old clichés that have been around, is with out-of-home you can’t turn the page, you can’t change the channel, etc. You know, that’s basically — what we’re able to do is to capture people as they’re going throughout their normal course of their day, you know, doing their normal routines.
DON: I will just add onto that, that I think a lot of the media properties that we specifically have acquired or have started have all — most of them have been around the idea of extended exposure, extended dwell time — not your traditional six-second read, but becomes something that can actually linger in somebody’s hands or is in an environment where they get to see that media for a long period of time. And the whole idea is we really want the media that we’re bringing to the table to provide an opportunity to resonate with the consumer. We feel we’ve done a good job with that with our product mix, and I think that’s one of the criteria that we look to many times when selecting products that we take on.
JOEY: Can you give some examples of where some of your programs are and what type of projects — a brand could use you guys?
ADAM: Sure. Again, as we mentioned, different types of non-traditional. So if you went to a café and you picked up a cup of coffee and there was an ad on the coffee sleeve, that’s typically something that we produce. Or you get a pizza delivered to your home and there’s an ad on the box. That’s something, you know, something that we do. You know, so brands like — we just did a coffee sleeve campaign for Google’s You Tube. And not too long ago we ran a pizza box campaign for Toyota for their pick-up truck. And then we’ve also worked with — we’ve helped companies monetize their assets to create ad revenue — companies like Hertz, Dollar and Thrifty — where we place messaging in their vehicles, and we have a long-term relationship with them on an exclusive basis. So, you know, brands like HP and Wal-Mart and various entertainment destinations like Disney and so forth have taken advantage of being inside a Hertz vehicle. And then we have our CVS drugstore opportunity where we place inserts in their bags at checkout. So, reaching, again people, you know, throughout their day, their week and the various stops that they make.
JOEY: Gotcha. Cool. And is there typically — you know, when you guys have this media outlet with, you know, let’s just say the HP or Google — is there a call to action for them to grab, or is it more just kind of a visual, getting the name out there?
DON: It’s really a mix. We have a lot of our clients that are part of branding campaigns. At the same time, with some of our lines, it’s all about direct response. So when Adam mentioned CVS, CVS is principally about getting direct response. We do an insert within the CVS bags on a national level, and those clients that have decided to participate in that program are looking to generate direct response, feedback or some kind of redemption. So it really depends on the program. We do, as an example, door hangers where we did about 25 million door hangers last year. The vast majority of door hangers is all driven toward direct response. At the same time, with the pizza boxes — that’s a media that’s generally used for branding purposes. So between our product mix, you have two different approaches, different tactics that are incorporated.
JOEY: Awesome. Twenty-five million — that’s a lot. That’s a lot of door hangers all over. Wow. I guess for a brand, I guess, you know, the biggest thing is the ROI at the end of the day. Let’s talk through kind of that. Typically, you know, how a brand gets their ROI, and how successful is, you know, I guess door hangers for a brand?
ADAM: We find it — you know, it’s interesting. You know, we love to get the data points from our clients, but clients rarely share those data points with us. What we do find is that the clients — and the reason that it’s grown to the amount that it has is because year in and year out, it’s the same customers that keep coming back with their offering, and claiming that they’re getting strong response and they continue coming back to us year in and year out. We have a pretty good renewal rate. Our retention is pretty good. So to Don’s point — a lot of times we don’t necessarily know why they’re coming back, except the fact that obviously their campaign is being seen and they hear about it and things like that. They don’t necessarily tell us, you know, we’ve got 835 responses or whatever. They just are seeing and hearing about it.
DON: And with the door hangers, in most cases there is a mechanism for response. Whether it’s 20% off or whether it’s specific phone numbers that are being placed there or other calls to action, the door hangers in many cases are driven directly towards direct response for them to be able to monitor the efficacy of the program. You know, our clients put those metrics in place and determine whether it’s effective, and evidently it’s meeting their parameters or barometers of success.
JOEY: Gotcha. Is there a brand — I guess there is a level of brands that actually use this type of marketing. I’m just thinking of, like, a start-up that just landed, you know, 50 or 100 million. Is that the best use of their money or is it usually, you know, some of the bigger players?
DON: We do get a very broad mix. I mean, we do have your who’s who of major brands out there that advertise with us on many of our product lines, and then we do have dot-com’s that are trying to build themselves some traction and they come on board as well in terms of making sure they could build up their client base and utilize our service. So it’s really hard to identify specifically. We do about 300+ programs a year, and the client base is varied from major national retailers to most of the — or many of the networks and TV channels, to quick-serve restaurants to —
ADAM: And I would say this. I would say that brands that still need to do a job of educating the consumer on who they are — not that they don’t buy from us, but, you know, a lot of times they want to get that message out, maybe in a more detailed way through other media formats. But as Don said, you know, we do get start-ups or brands that aren’t as mature. For example, one of our clients is Blue Apron.com. I think Blue Apron’s done a nice job of educating the consumer on who they are and what they do, yet they’re still a fairly young company. So I think we get companies that might be young but have done a good job on letting the consumer know who they are, and I think once people know who they are, then they certainly can knock on our door, in addition to the much more mature brands of, you know, Wal-Mart and Wells Fargo and those types of companies.
JOEY: Right. Gotcha. Yeah, Blue Apron is definitely a growing company. Yeah, that’s an interesting brand as well. And, you know, with the Amazons out there and whatnot, how can they get to those consumers as well.
JOEY: Very cool. You guys also do experiential marketing.
ADAM: Correct. We do.
JOEY: I’d love to learn more about, you know, what you guys do on that scale.
ADAM: Yeah, I was just going to say that I think that Don and I realized about ten years ago, or maybe even a dozen years ago, we started to really notice that the lines really have blurred, where you speak about out-of-home and experiential marketing, where agencies — it used to be very defined. This is an out-of-home shop, you know, this is a promotional agency, this is, you know, a media agency. We noticed about 10 or 12 years ago that those lines started to blur, and to your point that you made earlier where clients were saying, hey, we need to be part of this experiential world, so some clients started to reach out to us to say, hey, you know, can you do a tour for us, or can you come up with some stunt, you know, that’s PR worthy, or we need to check the box of, you know, we want some type of installation that, you know, can generate tons of impressions or tell a story that might live on, you know, long after, you know, the actual event is over. So we started to play in that space because our clients were asking us to, and it’s become, you know, a decent piece of what we do. We’re executing small events, midsize events, every once in a while a large event, you know, over the last number of years.
JOEY: Gotcha. With some of the brands that you work with, is it a lot of the people that are out of the home kind of industry that do this? They’re like, hey, we want to also do experiential marketing or tie it in, or is it kind of separate?
DON: I would say it’s a mix on that front, too. We definitely have the clients that have mixed the two. They’ve done programs that have included a couple of different media platforms that we have, and then they want to take that and roll it out and do more and engage with consumers and create more of a life for that program and take it beyond just that 30 days on the street. They wanted to create videos along with it, create content with it, and create some more exciting experiential elements to a program.
DON: Adam, do you want to expand upon that?
ADAM: I was just going to say, you know, typically when we meet with brands, you know, they’re sitting with these rosters of agencies, you know. So they’ll have — I would say a decent size company might be sitting with six or eight agencies. You know, like I mentioned, they might have a digital agency, an experiential agency, an at-home agency. What we find is that sometimes, you know, they want to try to integrate these things, but usually they’ll end up contracting separately. So even that they have this overall thought process and strategy, they seem to then, you know, divide that pretty clearly in terms of, okay this company is going to handle our experiential, and this company is going to handle our at-home, and you know, this one will be our digital shop. So it seems to be an overarching strategy, and then they break it down amongst a number of shops. That’s at least what we find.
JOEY: Right. Gotcha. Obviously every company is trying to, you know, find the right fit. Experiential marketing obviously, you know — the agency really needs to understand what their goals and their focus is, and obviously there’s a ton of agencies that do a whole bunch of different stuff. Moving forward with experiential, I guess, where are you guys seeing it go? I mean, there’s all the technology out there. There’s the millennial world that — I call it the 10- or 15-second bit content that you have to get in. It’s a really messy and crowded place. I guess we can kind of talk on both sides, from an experiential side to an out-of- home. I guess, how do these brands kind of stand out and get in front of their target market?
ADAM: Well, from an out-of-home side, I mean — like I mentioned earlier, you know, out-of-home, the last mass media — I mean, you know, we see that growing at double-digit rates, you know, moving forward. You know, it’s a supply and demand thing. You had the highway beautification act, you know, a number of years ago, so there really aren’t any more billboards being built along highways. So you have a certain amount of supply and in certain markets it’s limited, and in certain markets there’s still a great deal of inventory. You know, especially in the northeast and the major markets and also on the west coast in L.A., I mean, it’s just very limited amount of out-of-home. So rates will continue to grow and demand will be there. On the experiential side, you know, we always notice that there really is no barrier to entry to have an experiential company, whereas out-of-home is more of a real estate play. So if you’re creative and you have the right idea and know how to tell the story, well then you can certainly win business. So it’s much more fractured.
DON: It’s definitely a lot more fractured. I think that’s a great point. I think creativity is the key component when it comes to the experiential division. It is definitely a very competitive space, but I think the winning idea has an opportunity to be able to break through that mass of pitches that go on.
ADAM: I’ll give you a good example, because we’re actually working on something right now and I won’t mention the companies. But you have the company — it’s a liquor company — and they have a huge experiential agency that typically does their work. They came to us because their experiential agency was just not hitting the mark for the winning idea on a launch — it’s not a launch, but a re-branding of this particular account. So they came to us to say, hey, you know, we already do business with you guys on the out-of-home side. We know that you also play in this experiential space. Can you guys try to come up with a winning idea, and obviously gave us the background and everything. So, you know, we’re actually presenting on Thursday four or five concepts, not that it’s easy and we don’t know if we’ll win, but it’s a good example of what’s going on, as Don mentioned, how creative really drives the train here in our viewpoint where we can have the right idea and be creative, that all of a sudden we have an opportunity to win a, you know, mid six-figure, close to seven-figure piece of business.
DON: And that’s not to diminish the importance and value of operations. At the end of the day, it’s got to be executed flawlessly, and that’s where there might be some disparity between competent companies. So obviously that plays a vital role in success of a campaign.
ADAM: But we do find that there are a lot of companies who seem to be able to execute at a high level versus the brilliance of some of these creative agencies that have really grown tremendously because they just have the right creative director in place.
JOEY: Right. No, absolutely. And, like you said, you nailed it perfectly, that creative piece. Really, you know, it’s sparking an emotion, you know. Getting in people’s — instead of just, you know, seeing something, it’s like, you know, they could subconsciously be like, okay, I now know that brand because I experienced it and it was cool. I mean, again, that’s tangible. I guess, how do you guys — and I guess another piece, too, and I know I touched on the out-of-home piece, but I guess the ROI on an experiential program — how are clients kind of measuring that and how are you guys measuring it?
ADAM: A lot of times, they’ll try to have — you know, so, A, they’re going to measure impressions. So, you know, how many — you know, what type of media outlets picked it up, how many, you know, views are they getting on You-Tube and the social media aspect of it. They want to know, you know, how many likes on Facebook and Instagram and all that. So they’re trying to take all of these social media components, video components, etc., and apply impressions typically. Now, you know, at least I think from where Don and I sit, we feel that’s still a little bit of the wild, wild west there in terms of what’s real and what isn’t. So we’re still kind of trying to figure that out, and don’t necessarily have the secret sauce. So we listen to our clients and what they want us to do in that regard.
JOEY: Right. Gotcha. And again, you brought up another point, too. Just kind of, you know, experiential marketing, you know, really goes to a digital piece. Do you guys — and how do you tie in kind of a digital piece to an experience?
DON: A lot of times for us, you know, if it’s digital online, we will partner with another agency. It’s not necessarily our strength, so we feel rather than try to take a stab at it and miss the ball, we’ll bring in an agency that has more of an expertise.
JOEY: Gotcha. And that makes sense, yeah. You know, you can’t do it all. It’s good that you’re bringing the right partners on, because, I mean, that’s what, you know, really is important, too.
ADAM: I think the key is to know what you do very well and do that, and able to work with partners who do what they do effectively.
JOEY: Right. Exactly. Very cool. I had another question, too. Just kind of that out-of-home network. You did mention it was kind of a real estate play, and that was interesting. I’m literally looking out my window here and I see several billboards. I guess, is it something that you guys own, or is it, like, something leased all over? Like, these different assets that you guys have?
DON: So it depends on the property. If it’s, you know, partnerships, we’ve got exclusive contracts. If it’s locations where we have media placed like a billboard, those types of things, then those are contracts with landlords, etc. So everything’s contracted, you know, either based on a partnership agreement or based on that we’re basically, you know, locking up that environment to place advertising. But it’s all contracted.
JOEY: Gotcha. Cool. It’s a fascinating space. I mean, I know millions of people see these. I mean, even walking into a bathroom at a Denver Broncos game, there’s ads when you’re in line. Yeah, it’s pretty neat.
ADAM: It’s funny because, you know, you take a look at restroom advertising that’s now been around, you know, for probably 25 years. You know, the clients — consumers remember it. Their recall is amazing. And that’s one of the things, you know — we’re always looking to check certain boxes and certainly, as we said earlier, dwell time and recall and things like that are all, you know, critical to the equation.
JOEY: Right. And like you said, too, clients are continuing to come back and, you know, kind of marketing 101, you can’t just have, you — I guess going back — we get a lot of clients that come to us and they’re like, hey, we want to have a street team for one day, can you work with us. Well, no, because you’re going to get no ROI out of that. But it sounds like a lot of these brands understand, you know, the repetition over and over again. You know, that it helps build that brand up, and if you see it 5, 6, 10, 12 times, you know, you’re going to start being like, oh, I already know them and I actually trust them. Is that the kind of stuff you’re seeing as well when you’re working with these companies?
ADAM: I mean, it’s a great point about — Don and I get requests like that all the time about, hey, can you help us out for one day. You know, sometimes we almost feel obligated, if it’s a client that we already do business with, to almost, like, do them the favor. But, you know, you talk about risk and reward, and you’re dealing with human element and so forth.
DON: And distraction can be important.
ADAM: Right. So it’s definitely a great point about, you know, trying to determine if what your client is looking to do is going to create success, because if it’s going to fail, then you as a business owner need to make that determination to walk away or not. I don’t know if that answers your question. I got off on a tangent there.
JOEY: Oh, no. No worries. Kind of down that line, too, I guess. I know you said that you had a lot of companies coming back for the out-of-home side of things. I guess they’re really seeing a big value out there when they are continuing with those impressions and getting that brand out there.
DON: Yeah, I mean, our renewal rate is strong. Clients certainly see the message. You know, it’s interesting. You know, sometimes you get these big national campaigns from very large brands, you know, and they’ll pay a certain amount of attention. And then you get more regional brands that might pay even more attention to it. Obviously your local businesses that are really on top of things. But all of them at every level do return at a very high rate. So they’re seeing the value. Again, with out-of-homes, it’s a very hard medium to measure. I know between beacons and different types of technology and trying to integrate it with mobile and geo-fencing and things like that. You know, everybody’s always trying to see if they can, you know, prove a better ROI for out-of-home, but the bottom line is just the sheer number of impressions that these signs get, or the fact that they’re very targeted, or the fact that it ends up in someone’s hands or homes for a day, an hour, a week. That’s what really makes it work. Sometimes it just comes down to also the right person seeing it, you know. We’ve had campaigns where, you know, we’ll do a campaign with Hudson News, our airport partner. You know, we’ve gotten calls that oh, our sales team or our CEO, they’re seeing our messaging all over the place with our Hudson News branded bags in the airports. You know, right then and there, their own people are seeing it. So if they’re seeing it, they assume everybody’s seeing it and that gives them confidence to come back and buy the campaign again.
JOEY: Right. That’s great. I guess that kind of leaves off. Is there anything else you guys want to mention, just kind of what you’ve seen out there in the industry?
DON: I think overall we see it as a growing space. Our company, specifically, is always looking for the right product fit to put into our portfolio of products. We continuously look to enhance our own portfolio in terms of the way — with digital or some other elements we can add on to different kinds of programs that we have. We’re also a validator of the media as well. To go to the point you brought in before is the response rate. We also conduct recall studies, and we find these recall studies come in very high in terms of people’s recall of the message and their ability to remember that message or act upon the message. So we’re always looking to improve things and make the value proposition better for our clients. Adam, anything you want to add to that?
ADAM: No, I think you covered it.
JOEY: I’d love to continue this conversation down the road when you guys are — you’ve been in the industry for so long, you know, you guys can give definitely a lot of value. So I really appreciate you guys jumping on.
DON: All right, Joey. Thank you so much. We appreciate it as well. We look forward to continuing our discussions.
JOEY: Thanks guys.
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