This Burgeoning Vending Machine Startup Is Trying to Redefine Out-of-Home Digital Ads

It's getting to scale on college campuses

Vengo Labs’ vending machines serve digital ads on 1,400 screens, most of which are on university grounds or in gyms. Vengo
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If you’ve walked onto a college campus recently—perhaps New York University or Harvard—you may have come upon a digital ad kiosk that offered you free samples from Kiehl’s. Under that scenario, you would have had to supply your email address to get one of the skin-care brand’s products.

Kiehl’s has been orchestrating such samples-based prospecting via Vengo Labs’ network of vending machines that serve digital ads on 1,400 screens, most of which are on university grounds or in gyms like Planet Fitness. Vengo is really growing. During the first quarter of 2017, the 2-year-old company doubled its screens to 700, and they’re now in 38 out of 50 states. That growing presence is what drew Pivot Media to ink an exclusive partnership, which is being announced today, with the company and sell its growing inventory, specifically targeting CPGs.

“They always had the right placement, but now they have national scale,” said Pivot Media co-founder Jordan Perlmutter. “It’s a ‘solve’ in the out-of-home landscape.”

Whether Vengo Labs can become a formidable OOH player remains to be seen. In addition to the digital ads and sampling, marketers can buy physical wraps around the interactive machines. The cost for its ads run at a CPM, or cost per thousand, rate of around $8.

The targeting can be interesting. “You can imagine [gym ads] in locker rooms that are gender specific and brands that they need,” said Brian Shimmerlik, CEO of Vengo Labs, which, per CB Insights, competes with U-Vend and VendScreen.

Meanwhile, Vengo Labs’ biggest claim to fame may be getting a $2 million investment on ABC’s Shark Tank from investors Kevin O’Leary and Lori Greiner. It seems safe to say they’ll keep an eye on this Pivot Media deal.

@Chris_Heine Christopher Heine is a New York-based editor and writer.