A few years ago, out-of-home advertising was still primarily used by either big, traditional brands or local businesses. But as technology becomes more engrained in everyday life, companies like Facebook, Foursquare and a crop of startups are putting new twists on old-school advertising to build brand recognition and drive app downloads.
Boxed, an app that sells and delivers wholesale packaged-goods, is one such startup enlisting subway ads in New York to drive app downloads. The marketer launched a new subway campaign last week, taking over all ad placements on one side of subway cars. It's the second time Boxed has run underground ads; here's a look at one of them:
"We've tried a lot of ROI-based ad networks, and [out-of-home] averages out if you do it right," said Chieh Huang, CEO of Boxed. "Even though it is more expensive, we can recoup the costs."
Huang acknowledged out-of-home ads are tougher to track than digital, in terms of how many downloads an ad drove, but both tactics are effective in acquiring loyal users, defined as people who keep an app on their phones for a long period of time.
The CEO said the public transit promos work for his company because Boxed is set up to drive sales. While download numbers are important, so is teaching people to shop from their smartphones, which requires a brand-building campaign. The company declined to provide stats but said people who see the out-of-home ads spend more money than those who see the digital ones.
"Because we do drive revenue, we're able to make bigger bets—you don't see a lot of games being advertised in out-of-home yet," Huang noted.
The creative on the Boxed ads are also meant to show off the advantages of shopping online, specifically for New Yorkers who buy in bulk.
In fact, online food takeout company GrubHub Inc.—made up of GrubHub and Seamless—has used out-of-home and subway ads since launching more than 10 years ago in all of its major markets. And with 50 percent of all orders coming from mobile, the ads seem to be getting attention.
"We're capturing people when they're on the way home from work, when they're hungry, so it's natural to drive them to download the app," said Abby Hunt, a rep for GrubHub Seamless.
East Coast healthcare startup Oscar has also made a big bet on out-of-home ads within the past year. Oscar started advertising on the subway in October 2013 with small placements.
"It was a bit of an experiment given that we are a startup with small budgets compared to all the other health insurance companies out there," said Veronica Parker-Hahn, vp of marketing at Oscar. "We knew we needed a way to drive awareness of Oscar, but we didn't have the money and we weren't quite ready to dive into the pool of TV."
Anecdotally, the ads built buzz and are now being expanded to include more placements and to reach New Jersey.
Traditional, Tech-Driven Creative Goes National
New York's subway has an obvious advantage for tech brands over most markets since it's the primary way people get around. But the out-of-home trend is hitting other major cities, too.
This week, Facebook launched its first out-of-home campaign in Los Angeles and Chicago to promote Messenger, its mobile messaging app.
"By using a variety of [out-of-home] creative in our 'Say Anything Better' brand campaign, we could be a part of the city landscapes while simultaneously showcasing different messaging for Chicago and L.A.," said Rebecca Van Dyck, head of Facebook's brand marketing.
The Menlo Park, Calif.-based company is running billboards in Chicago and L.A.'s airports, freeways and trains with graphic visuals that aim to position Messenger as a mobile app that does more than text messaging. A digital ad buy also includes more traditional app-install ads.
"With all of the features, it allows for a very visual form of communication. We wanted to look at the conversations that people are likely to be having using an app like Messenger," said Matt Skibiak, copywriter at Wieden + Kennedy Portland, Facebook's agency of record behind the campaign.
To help do that, Facebook cast 25 to 30 real people (although not all of them were used) to be the faces of the campaign.
"At their core, Facebook is a product that's composed of real people, and they're not shying away from talking about real things and showing real people in their ads," Skibiak said.