Out of home advertising company APN Outdoor has relaunched the price structure of its transit offering in the face of a tough advertising market.
In the announcement, the company made clear that it is offering heavy discounts and wider coverage as it attempts to increase its share of the cut-throat outdoor market.
A statement from Phil Eastwood, GM of sales at APN Outdoor, said: “Like all media channels, we need to constantly review our offering to market to ensure we are providing advertisers with a compelling proposition. With the introduction of new routes to the Transit Network, it is incumbent on us to regularly review our reach, frequency and SOV outcomes. And this we have done with our new packages – increasing panel numbers in some cases by as much as 60%.”
In what it describes as “stimulus”, APN Outdoor is also offering discounts on production costs in the first quarter of 2013.
APN sold 50% of APN Outdoor to Quadrant private equity earlier this year.
The move comes on the back of an aggressive push for market share by competitor Adshel (which is itself a 50% joint venture between APN and Clear Channel).
Adshel – which was named media sales team of the year at the Mumbrella Awards in October – saw revenue growth of 22% in the last financial year. Competitors say that some of Adshel’s growth was achieved by discounting which allowed the company to deliver sufficient reach and frequency to advertisers that they did not need to spend as much with other companies.
One observer – affiliated to neither Adshel or APN Outdoor – told Mumbrella: “You can book two weeks across Adshel for half the price and probably get all the reach and frequency you need.”
Adshel argues that it delivered the growth through offering value, not discounting.
As well as attempting to position its Transit offering solidly as a broadcast medium, APN Outdoor’s move appears designed to compete more fiercely with Adshel on price. It may also reflect soft forward bookings in the advertising market for early 2013.
According to APN Outdoor: “This is the largest change to the structure of Transit that APN Outdoor has ever delivered to the market and the incremental audience delivery, share-of-voice (SOV) and value proposition to advertisers is significant. As a further stimulus, APN Outdoor is also incorporating discounts across production for Q1 2013.”
The depth of the company’s discounting is also demonstrated in a message on its website telling potential advertisers: “APN Outdoor has released its new 2013 Transit Packs. The new packs deliver massive upsides to our Impact and Broadcast formats. We are offering heavier panel weights across the board (50% increase in some cases), and in the case of the Megasides we are also offering an additional 2 weeks display to 6 weeks.
“As a bonus, APN Outdoor are offering a 20% discount on production for all new National and Eastern Seaboard bookings made between now and 29th March 2013. Campaigns can be scheduled to run at any time throughout 2013.”
A spokesman for Ashel told Mumbrella: “We’re really disappointed with the speculation that Adshel’s sales growth has been attributed to heavy discounting. To set the record straight, Adshel have not lowered its prices, in fact our prices have gone up year on year due to demand.”
“Adshel’s out-of-home inventory is highly cost-effective with huge reach and frequency outcomes. We’ve worked really closely with our clients this year to demonstrate the flexibility and innovation of our panels. This fact, together with being able to provide brands with proven campaign ROI, have been the real drivers of our sales growth.
“Out–of-home is a medium which is yet to live up to its massive potential in Australia. As a category we provide brands with a very cost-effective means to reach and engage consumers. It is disappointing to hear competitor speculation about cost-cutting, as this type of ‘gossip’ undervalues all our offerings.”
- Declaration of interest: APN Outdoor is currently advertising its Transit offering in ads on Mumbrella’s daily email.