APG head Markus Ehrle: “The time of the classic poster is not counted at all”

APG was able to significantly increase its advertising revenue in the first half of the year.

The Klein Report spoke with the CEO Markus Ehrle about the dynamics of the digital outdoor advertising market, about the power consumption of advertising screens and about the lifetime of the inserted poster.

On Friday, APG announced that sales of digital advertising media had shown a “gratifying development”. What does that mean in numbers?
Markus Ehrle
: “In principle, we do not communicate any detailed figures on the development of individual segments or forms of advertising.”

How did the increase occur?
Honour: «This is due, on the one hand, to APG making a growing digital portfolio available to advertisers, and on the other hand, to clients and their agencies appreciating the short-term nature and flexibility of booking and showing ‘Digital Out of Home’.»

APG continues to record frequency losses in transport advertising and in the promotional space industry. Where do you see the reasons for this?
Markus Ehrle: «We must not forget that at the beginning of the year (until 17 February) there was a strict mask and certificate obligation as well as a clear recommendation to work from home. In addition, the mask requirement in public transport remained in place until the end of March 2022. These measures naturally had a dampening effect on mobility behavior and frequencies in public transport, at train stations and at airports. Since March, however, there has been a clearly positive trend.”

Will the pandemic also weaken the means of transport as an advertising channel in the long term?
Honour: “No. Frequencies are recovering quickly and in some cases are already back to the previous year’s level. And in the ‘long term’, public transport will prevail at the expense of private transport (think ever-increasing fuel and energy costs, traffic congestion and reduction of inner-city parking spaces).This means that these channels remain attractive for high-impact outdoor advertising.”

And how do you see the future of advertising space?
Markus Ehrle: “The promotional space business will also recover very quickly, as haptic experiences and live communication with products become even more important, precisely because of the increasing digitization.”

The advantages of digital out of home are obvious: advertising can be played out more flexibly and programmatically, and moving subjects are also possible. On the other hand, there are high infrastructure costs, be it in manufacturing and installation or in operation and maintenance of the high-tech screens. How does APG handle this benefit/cost ratio?
Honour: «Digitization is only worthwhile in excellent, highly frequented locations, and then if you can also use the advantages in the display. Offers in Zurich where certain screens can only be played ‘quietly with a change of subject every 24 hours’ are obviously absurd. From APG’s side, we therefore attach great importance to digitizing where it makes ecological and economic sense, and where the visibility and price/performance ratio suit the advertising customer.»

What is the ratio of analogue to digital advertising space at APG these days?
Markus Ehrle: «APG manages well over 140,000 areas. The vast majority of these are analogue offers. Digitally, there are about 1,100 in formats larger than 55 inches. In addition, around 1,500 TrafficMediaScreens.»

How do you intend to further develop the digital business in the coming years?
Honour: «We will and will continue to develop the digital offer, but we will continue to focus on ecological and economic premises as well as the benefits for our advertising partners. It also depends on the authentication practices of digital systems, which are not always very straightforward. We are also making great progress in terms of energy consumption; a large outdoor screen does not require much more power than an hour of streaming on an HD TV.»

Is the time for the classic poster over? Or how will the analogue outdoor living offer continue to change in the course of the digitization of outdoor advertising?
Markus Ehrle: «No, not included at all. Because we have also achieved significant gains in the analogue area. A glued poster or a poster backlit with LEDs still impresses today with its shine and visibility. And we are now also flexible in the analogue business with regard to posting duration and delivery time.»

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