Selling Where People Buy: The Rise Of In-store TV

You probably haven't heard of the Out of Home Video Advertising Bureau, but it's just been incorporated as the latest advertising trade association. It will serve as a clearinghouse for information about in-store TV advertising, which is still a relatively tiny business by TV ad standards. But the medium is gaining greater acceptance by ad agencies, and advertisers are using it increasingly as a branding vehicle and not just as a promotion tool to move product off the shelf.

Mark Mitchell, evp, ad sales, Premier Retail Networks (PRN) and one of the organizers of the new group, said there's a need to have a coordinated, industry-supported effort to help advertisers and agencies tap into the burgeoning medium. The group will market and promote ad-supported TV networks in retail chains like Wal-Mart, Kroger's and Circuit City. Organizers said they expect to formally unveil the new organization in September with roughly 20 charter members. The search is now on for an executive director to run it.

The appeal of in-store TV is obvious: advertising to consumers as they're looking to purchase. Up until recently, Mitchell said, clients have been more open to the medium than their agencies. But that's changing, and agencies are embracing the sector as the media landscape has become more complex, Mitchell said. "I would say the top trend in this space is really agencies looking at in-store television as an integrated part of the overall media and communications campaign," he said. "360 communications planning used to stop outside the retailer, but now you can integrate it because you have a national television audience inside the store that you can build into the planning process."

Agencies acknowledge that they see in-store as a more viable option in today's fractured media environment. "In the past I don't think agencies did consider in-store TV," said Bob Bernstein, evp, media director at Interpublic Group's Draft FCB Group. But now, in the increasingly media-neutral world, he said, "everything's open, including in-store."

PRN, which provides ad-supported content to 6,000 stores nationwide, reaches 225 million viewers a month, said Mitchell. About 150 million of them are Wal-Mart shoppers.

Estimates on the size of in-store TV advertising vary, and one of the tasks of the new trade group will be to calculate an accurate tally. PQ Media puts the total at just under $100 million for 2005, up 45 percent from the previous year. But Mitchell said PRN by itself sold about $100 million in ads two years ago and that sales have grown more than 10 percent for each of the past two years. PRN hasn't disclosed sales figures since being acquired in 2005 by Thomson, the video technology company, for $285 million. Other in-store network providers include SignStorey and Ignition.

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