SMARTLINK CASE STUDY: Lamar Advertising Company

BACKGROUND:

Founded in 1902, Lamar Advertising Company (Nasdaq: LAMR) is one of the largest outdoor advertising companies in North America, with more than 315,000 displays across the United Stated, Canada, and Puerto Rico.  Lamar offers advertisers a variety of billboard, interstate logo, and transit advertising formats that help both local businesses and national brands reach broad audiences daily.  In addition to its more traditional Out-Of-Home inventory, Lamar is proud to offer its customers the largest network of digital billboards in the United States with over 2,000 displays.  Lamar is considered one of the nation’s leading outdoor billboard companies in respect to superior outdoor locations, effective design, and affordable production, all backed by a truly excellent service team.

Lamar of Dallas, Texas is proud to serve the advertising needs of the Dallas and Fort Worth areas.  With their extensive inventory of Billboards and Digital Displays, they can craft a campaign and successfully reach any target audience.  The Lamar Dallas, TX plant has 510 structures, which is roughly over 1, 100 displays, available for clients to advertise.

Almost all locations are positioned on high-traffic interstate and highways in the Dallas-Fort Worth Metroplex.  With coverage in Collin, Dallas, Denton, Tarrant, and the 12 surrounding countries, they can offer far-reaching exposure, as well as target specific areas and demographics.  As the home of major sports teams, museums, amusement parks, entertainment venues, and over 400 corporate headquarters, Dallas is a leader in big business and is one of the top travel destinations in the U.S.

CHALLENGE:

Lamar has always relied heavily upon conventional timers such as photocells, mechanical time clocks, and other smart timers such as Profile, to turn their billboard lights on and off.  This meant that most lights burned more daily kilowatts than necessary, which also led to higher monthly utility costs.  A phenomenon known as “time drift” was an ongoing daily issue.  This occurred when utility power was lost at a location.  The timers would slowly drift from the correct time, causing the lights to come on too early or too late.

Another challenge was that many of the timers used were not upgradeable.  They utilized Analog signal communication which was set to go dormant in the summer of 2009.  Once this occurred, the “time drift” phenomenon would become even more evident and employees would have to react by visiting many locations and adjusting the time.  Employees would also have to visit all locations twice a year to adjust the time for Daylight Savings.

Lamar’s employees had to visit, or “ride”, to each location weekly and report any bulb outages or other electrical issues to the Operations Manager.  The Operations Manager would then create a “trouble ticket” and give it to the electrician for repair.  Without riding the lights, electrical issues were never detected unless a client discovered and reported them.  At this point, the client asked for a credit.  Most contracts between Lamar and its clients state that a credit must be issued if the nightly illumination was knowingly interrupted for more than 72 hours.  To minimize the potential credits, Lamar would have to expedite trouble tickets to electricians and subcontractors which led to higher-than-normal ongoing maintenance costs.

In addition, Lamar has several employees, known as Charting managers, whose sole responsibilities are to manage the client contract dates, make sure the ad gets posted on time, and notify operations of the contract expiration.  This procedure was accomplished by passing paperwork back and forth between the departments.  As a contract expired with a client, Lamar employees were sent to manually turn off the lights for any unsold advertisement.  They did this by turning the breaker off.  If not, the lights would continue to burn every night and Lamar would continue to pay higher monthly utility costs while not collecting any additional revenue from the former client.

Every Structure visit employee, fuel, insurance, and vehicle maintenance expenses for Lamar.  The above scenarios would either cost Lamar additional utilities or possible credits issued to clients.

SOLUTION:

Although Lamar Dallas had already invested in Profile, they were still looking for more than utility savings.  They were searching for a solution that could give them remote CONTROL of their billboard illumination and utilities, and also notify them when they has electrical issues.  Further, they were seeking a smarter solution that could be upgraded as cellular technology required them to do so.  SmartLink™ was their solution!

OutdoorLink, Inc., manufacturer of the SmartLink™ lighting controller, installed the SmartLink™ 302 Lighting controller on all 510 of the Lamar Dallas billboard locations.  The SmartLink™ 302 is a cellular, M2M lighting controller designed to remotely control and monitor billboard lighting.  The modem card within the SmartLink™ unit is upgradeable and can provide cellular service through AT&T, Verizon, and T-Mobile.  The SmartLink™ was designed specifically for the Outdoor billboard industry by former outdoor billboard professionals with over 50 years of experience.

The SmartLink™ allows Lamar to remotely turn their billboard lights on and off with different burn schedules, which allows them to save wasted kilowatts and only illuminate necessary lights at predetermined times.  “Time Drift” is completely eliminated with SmartLink™ ‘s Automatic Network Time feature.  Once utility power is restored, the SmartLink™ automatically receives the correct time.  The daily sunset and sunrise change is calculated, as well as Daylight Savings twice a year, and accounted for at every location, eliminating more wasted utility and the need for manual time adjustment.

The SmartLink™ will also monitor the billboard lights in Real Time and send email notifications when power is lost, power is restored, or a bulb burns out.  In most cases, Lamar can quickly dispatch their electrician to fix the electrical issues within 48 hours.  Proof of Performance reports are always available online which verify the lights turned on, when the lights shut off, and if there were any electrical issues during the period of time.  The entire illumination process is now transparent.

Additionally, the SmartLink™ can easily integrate with Lamar’s charting system, which streamlines operations and automates the illumination schedule based on the contract start and end dates.  Lamar no longer has to manually visit a location to turn off the lights when a contract expires.

RESULT:

Lamar Dallas, TX has saved an average of $8,679.00 on their monthly utility bill, or 26 percent since installing the SmartLink™ lighting controller, thus creating a cumulative savings of over $607,500.00 since June of 2009.  The ROI was 23 months, which is very impressive for the outdoor billboard industry.  The number was higher due to their previous investment into Profile.  These savings have allowed Lamar to invest in other technology such as Digital billboards and the new LED light fixtures at a very minimal impact to their bottom line.

Also, Lamar no longer has to “ride” their billboard lights.  Nightly proof of performance reports are available online to validate illumination and any electrical issues that might have occurred.  The Operations Manager can simply log into his online SmartLink™ account to view any new electrical issues.  Customer credits have been reduced or almost eliminated.  The SmartLink™ ‘s reliability has reduced the volume of open electrical repair tickets from 2 – 3 weeks to a consistent backlog og only a day or so.

Lamar has been able to reduce the number of charting employees responsible for charting activities.  Through the integration of SmartLink™ and their charting system, Lamar can now focus less on paperwork and more on providing their clients the best overall experience in the industry.

Customer satisfaction is at the highest level for Lamar in many years.  Clients tell Lamar that their overall illumination outpaces the competition.  Employee, fuel, insurance, and vehicle maintenance expenses have all been drastically reduced.