Chains aim to localize messages, engage guests with promotions via out-of-home video networks

Just as restaurants embraced the Internet when they realized it could reach their audiences, more chains are subscribing to out-of-home video networks and counting on their place-based marketing strengths to reach existing customers.

Einstein Noah Restaurant Group is among the latest companies to add an out-of-home video network to its marketing arsenal. It recently signed with Ripple, whose video screens are located in specialty retail locations and feature entertainment and news items as well as product messages.

Programming to be viewed at Einstein Bros. [3] and Noah’s New York Bagels [4] will include suggestive selling spots for featured items, including pitches aimed at luring guests back for other dayparts.

Ripple, based in El Segundo Calif., is one of several companies offering such networks to restaurant chains. Among its clients are The Coffee Bean & Tea Leaf [5], Jack in the Box [6], Robeks, Tully’s Coffee [7] and Juice it Up!

San Francisco-based Danoo and New York-based Zoom Media & Marketing also work with restaurants on place-based marketing through their networks. NTN Buzztime, which provides interactive games to restaurants and bars, is about to launch customizable screens that restaurants can use for ads and promotions.

Out-of-home video advertising generates more than $1 billion a year in revenue, and its growth rate is second only to Internet advertising, said Suzanne Alecia, president of the New York-based Out-of-Home [8] Video Advertising Bureau.

“Projected revenue will grow upwards of 25 [percent] to 27 percent a year for the next three years,” she said.

Marketers began to add out-of-home video advertising to their media mix during the last few years when they discovered that “relevant and interesting” ads combined with news, sports and entertainment on the in-store screens could generate sales, Alecia said.

The ads and programs reach “a very targeted audience and in some cases a super-targeted audience,” she said.

Einstein Noah, whose system has more than 600 branches in 35 states, plans to install video screens in the “vast majority” of its stores, said Jim Hood, chief marketing officer for the Lakewood, Colo.-based chain. Ripple pays for the screens and computer infrastructure to provide the video content, he said, and the chain incurs “essentially no out-of-pocket expenses.”

The screens will provide news, entertainment and weather reports. The content can be customized, for example, to include surf reports in California units and ski conditions for Colorado stores, Hood said.

Customers also will be allowed to put messages on the screens wishing their friends a happy birthday or anniversary, and schools in the area can publicize such events as choir concerts, he said.

“Really local stuff like that is consistent with our neighborhood look and feel,” Hood said. “We are perceived by our guests as a neighborhood restaurant.”

The chain also hopes its use of the screens will bring frequent breakfast customers back to the restaurant for lunch by promoting wraps, soups and salads that they may be unaware of, he said. Einstein Noah also will be able to use the screens to test promotional offers to determine which generate more sales, Hood said. For example, several stores in a given city can promote one offer while others in the city offer a different one.

The chain is “not by any standard a big spender when it comes to marketing,” he said, and because an average of 300 customers a day visit the restaurants, the screens will play a “huge role, a significant role in our total messaging program.”

The screens take advantage of a consumer’s “dwell time” while waiting in line or eating a meal. The average consumer spends 11 minutes at locations where Ripple screens are installed, said Ripple chief executive John McMenamin.

“Consumers have gotten increasingly comfortable with receiving information in a variety of ways, including via Internet and on their cell phones,” and that “has opened the out-of-home market to augment more traditional methods of advertising and marketing,” he said.

Among Ripple’s content partners are MSNBC, Reuters, E! Entertainment, The New York Times, Yahoo!, CBS and Wikipedia. Content at specific locations is designed to create an “engaging consumer experience and a compelling call to action,” McMenamin said. “Every screen has the ability to contain different information and advertisements that meet the needs of the consumer in that particular store.”

The Coffee Bean & Tea Leaf [5], the Los Angeles-based chain of more than 650 units, was one of Ripple’s first clients and uses the network in about 200 of its stores, chain president Mel Elias said.

“The feedback we’ve had is great,” he said. “I’m very pleased with it. One interesting benefit is that it actually reduces perceived wait time in the stores.”

The TVs display a variety of content, including daily horoscopes, stock market news and weather. Traffic updates are one of the most popular features because customers visiting a store near a freeway can see if there are any accidents and plan an alternate route to get home, Elias said.

The video screens are “one more opportunity to get the message out in the store” about promotions, he said. The chain has no mass-media strategy, relying instead on local-store marketing and public-relations events, Elias said.

Coffee Bean also encourages local businesses to think of the screens as a “typical coffeehouse community board” and advertise on them, Elias said. In keeping with that spirit, the ads must “enhance the community we live and work in,” he said, adding that local businesses do “a large amount of advertising” on the screens.

Buzztime, based in Carlsbad, Calif., plans to launch new technology in August that would enable restaurants to display ads and promotional news on their wide-screen TVs alongside Buzztime’s trivia, sports and casino-style games.

“The real benefit to this is if you’re a chain it allows consistency of message,” said Jake Tauber, Buzztime’s executive vice president for content and marketing. “If you’re an independent, it allows you to reduce the point-of-sale printed-material cost.”

Initial customers of the new program include several Buffalo Wild Wings [9] locations and various independent operators in such states as California, Colorado and Massachusetts.

Restaurants pay an installation fee for Buzztime games, but there’s no additional cost for the customizable product, Tauber said.

He acknowledged that consumers tend to ignore advertising both in-home and out-of-home, but he believes an ad on a screen next to an interactive game that customers are playing is hard to miss.

“What this does, in a way, is demand that people’s eyeballs look at the screen,” he said.