Since billboards already line Los Angeles streets, a couple of local companies are looking to another logical place for advertisements in this traffic-choked city: gasoline station pumps.
In a move that could change drivers’ gas-station experience, Westinghouse Digital Electronics LLC, a Santa Fe Springs-based electronics manufacturer, has teamed with an advertising company to create a narrowcast that will be displayed on flat-panel television screens placed near pumps in thousands of gas stations across California, called “PumpTop TV.”
Under the arrangement, Costa Mesa-based AdtekMedia Inc. will supply a five-minute program featuring news and advertising, while Westinghouse will build 19-inch monitors to be installed near fuel pumps.
“It’s kind of a boring experience, pumping gas,” said Douglas Woo, president of Westinghouse Digital. “You can do nothing but stare.”
As a result, Woo said, gas stations provide a captive audience as drivers wait at the pump.
Of course, not everyone is sure this new advertising will be effective.
Eli Davidson, a Los Angeles consultant who coaches executives around the country, said news and advertising are becoming so prevalent that people may just tune it out.
“We’re so inundated by media attention that I believe more of the same isn’t going to change consumer behavior,” she said.
Indeed, such out-of-home media networks are becoming ubiquitous in grocery stores, movie theaters and gyms. Furthermore, advertisers are not always eager to sign up because the effectiveness of out-of-home media networks is difficult to track.
However, gas stations provide some unique advantages. The number of people visiting a particular gas station can be tracked with reasonable precision, and the gas-pumping procedure all but requires drivers to linger for a couple of minutes within viewing range of the screens.
In the hopes that gas station networks will gain traction with advertisers, PumpTop TV’s backers are now pushing ahead with a major expansion of the program.
Roy Reeves, vice president of sales and marketing for AdtekMedia, said they hope to install screens in 500 Los Angeles area gas stations, including Chevron, Shell and 76, by September. If they manage to reach their ultimate goal of 75,000 screens across the United States, they figure they could reach 100 million drivers each month.
They rolled out PumpTop TV in 2005 and they now have screens in about 50 gas stations across Los Angeles and some in other locations in California.
While Los Angeles is the biggest market in the expansion, the companies intend to bring the network to as many as 60 cities, including Phoenix, Dallas and Atlanta.
Already an established player in the liquid crystal display television market, Westinghouse is making customized LCD televisions for the partnership. Among the specifications, the company said the screens have to be durable, able to withstand changing climate and bright enough to be seen in a sunny outdoor environment.
Early errors
Reeves said the company has learned from some mistakes along the way.
“When we were first installing in gas stations in 2005, the units were just running advertisements,” he said. “It soon became somewhat of a turnoff, just showing ads.”
As a result, the company began negotiating with content providers in the hopes of creating a more interesting program. “The consumer experience really is our main focus here,” Reeves said. The company soon teamed with KTLA to produce a five-minute news program updated several times daily to be run on a loop.
But the company is not neglecting advertisers. The screens are split so that one side can display advertisements while the other features news. And AdtekMedia is hoping to expand the program to include traffic information, weather, sports and entertainment.
Dick Paulsen, president of AdtekMedia, said the company intends to make each gas station’s network unique by allowing local advertisers to buy time at just the stations they choose.
“In almost all cases, we’ll have a mix of national advertisers, regional advertisers and local advertisers,” he said.
Among the organizations advertising on the network are the Los Angeles Clippers, Universal Music Group and Whata Lotta Pizza, a restaurant franchise based in Orange County.
Westinghouse declined to provide details about the cost of the program, but Reeves said the cost for AdtekMedia will be about one cent per viewer. AdtekMedia has been working on out-of-home media networks for several years. But the foray into digital signage is new territory for Westinghouse.
The company was started in 2003, before LCD TVs had gained mainstream acceptance. But the company carved a niche in the market by manufacturing lower-end, affordable LCD televisions. The timing was serendipitous as the market for flat panel displays both LCD and plasma screens has exploded recently.
Last year, Westinghouse accounted for about 5 percent of the total American LCD TV market and ranked seventh among LCD TV manufacturers, according to iSuppli Corp., an El Segundo research firm. Westinghouse did even better in the fourth quarter, ranking fifth behind such industry heavyweights as Sony Corp. and Sharp Corp.
With the consumer side of the market taking off, Woo said Westinghouse decided last year to pursue the commercial side of the LCD TV market and looked into out-of-home media networks.
“We believe that out-of-home media networks will be a major part of life,” he said. “It’s a matter of time, it’s a matter of imagination as to where those out-of-home media networks will be placed.”
