Zoom buys WHEN network; bad news for EnQii

May 28, 2009 by Dave Haynes

We’ve all been expecting consolidation among digital out of home network operators, with the bigger guys who have money taking out the smaller guys who are huffing and puffing their way through this recession.

Zoom Media is one company with money, and the Montreal-based company just bagged another network to add to its roster.

From MediaPost:

While other media are looking moribund, digital out-of-home is positively vibrant, with networks striking partnerships and making acquisitions to expand their reach. In the latest deal, Zoom Media and Marketing has acquired the Wellness Health Education Network, a subscription-based service that operates digital signage displaying health-related content and advertising in 255 fitness clubs around the country. Zoom didn’t divulge the terms of the deal.

The acquisition expands Zoom’s footprint in U.S. fitness clubs by almost 25%, from about 1,095 to 1,350 (including foreign locations, Zoom’s network totals 2,000), and also gives it access to WHEN’s digital content. Zoom plans to import WHEN content, which is tailored for the fitness environment with news, lifestyle tips and facility-specific information, to the rest of its fitness network. With WHEN in its portfolio, Zoom can reach fitness club patrons with a mix of entertainment and relevant informational content, according to Dennis Roche, president of Zoom Media, who emphasized the benefits for patrons and advertisers alike.

The news of the WHEN acquisition comes a few months after Zoom announced it raised $30 million in a new round of funding led by ABS Capital Partners; at the time Zoom said it would use the funds to make strategic acquisitions in the out-of-home advertising market, with a special focus on digital out-of-home. Zoom made a number of acquisitions even before obtaining the new funding, including the purchase in March 2008 of Alloy’s nightlife network, covering 2,000 venues, followed by the purchase of ClubCom, another digital out-of-home network serving fitness clubs, for a rumored $20 million in September 2008. In October Zoom and ClubCom announced a deal to bring ClubCom digital displays to Bally Total Fitness, creating a network called Bally TV.

In addition to fitness club and nightlife venues, Zoom also owns static and digital out-of-home networks reaching restaurants, family entertainment centers, bowling allies, and the like. Overall its various networks cover a total of over 10,000 venues, including 25,000 digital displays and 55,000 billboard spots. 

WHEN is a client EnQii has given a lot of love to over the past three years, and made it one of its case study accounts. But Zoom uses the software ClubCom built for itself, meaning WHEN will very likely move off the Remote Transfer platform over time to the ClubCom platform. BroadSign is also on the losing end of Zoom doing its own thing.

During my time at EnQii I watched this account bubble up. The company is in a good vertical (which Zoom obviously recognizes), but the programming plan is, I’ve always thought, all wrong. The sample image from the WHEN web site shows a typical screen absolutely overloaded with information, and the advertising window is the thing in the right bottom corner. Smallest element on the screen, and an oddball shape. You can buy an ad in the main window, but it runs in the content cycle and only plays once every 15 minutes. I doubt many people are in front of this screen for more than a minute, at most, meaning the OVAB measurement on this goes way down.

I would imagine the WHEN account execs got a lot of the old, “How much for full screen?” question from planners and brands.

The layout is not a formula for success, and I suspect the Zoom guys will be revisiting that.

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