Report: McDonald’s green-lights 800-site Digital OOH test

October 18, 2011 by Dave Haynes

There is a running joke in this sector about the number of software, hardware and ad network companies that have the golden arches of McDonald’s on the Client page of their presentations.

EVERYONE somehow or other manages to turn a little local deal with a franchise-holder into McDonald’s being among the clients.

But there now actually seems to be a company that really does have a significant deal with McDonald’s (bearing in mind Stratacache and NEC are doing menu-boards in McCafes and I know a deal is in place for Canada, but not sure that’s public).

The Los Angeles Times, in a story picked up all over the place, reports the fast food giant has done a deal that will see a custom content channel installed and operated in its dining areas, expanding on a small regional test to 800 sites in the southwest, and then perhaps a full roll to some 13,000-plus sites in the U.S.

Reports the Times:

The McDonald’s channel, being rolled out slowly during the next few months and will soon be up in 800 McDonald’s restaurants in Southern and Central California, is being spearheaded by ChannelPort Communications LLC, a Los Angeles-based company specializing in entertainment content, technology and brand management. Programming will be anything but low-key and grass-roots: Reality TV mogul Mark Burnett (“Survivor,” “The Apprentice,” “The Sing-Off”), BBC America and KABC-TV Eyewitness News are on board to provide content for the new network.
The venture, which has already been tested in L.A., San Diego and Las Vegas, is expected to reach 18 million to 20 million people a month, which ChannelPort executives said would be one of the largest daytime audiences in the region. If successful, the project, which will also include interactive elements on Web and mobile platforms, may expand nationwide.

“The intention is to catch and engage the customer, and then enhance their experience,” says Leland Edmondson, founder of ChannelPort. “The McDonald’s customer is everyone, and we want not to be passive viewers but to be active and participatory with this network.”

The programming will be hyper-local, with local news and entertainment features, such as spotlights on upcoming films, albums and TV shows.

One key content provider for McDonald’s will be Vimby,  developed and delivered by Burnett’s Van Nuys-based digital production company, using a network of more than 150 filmmakers in 40 cities to generate original programming for the Web, portable devices and television.

“We believe there are so many screens in America that people are able to watch on and aggregate,” Burnett says. “And it’s more than sitting at home watching TV. Our company can do digital content on a national scale but with a local focus.”

The dining areas of participating restaurants will be fitted with two high-definition 42- to 46-inch screens that will be visible from 70% of eating areas. Audio will be heard from the screen or ceiling speakers. Those who do not want to see or hear the channel will be able to eat in “quiet zones.”

The programming will be shown in a one-hour cycle consisting of installments or “pods” lasting 20 to 22 minutes. Each component will have several segments that include “The McDonald’s Achievers,” which will profile local high school and college athletes; “Mighty Moms,” a focus on local moms juggling home life with careers in sports such as coaching or training; “McDonald’s Channel Music News” about musical acts, tours and new releases; and Burnett’s “Vimby,” which will cover fashion, art, music, night life, lifestyle and culture news.

About eight minutes an hour will be devoted to advertising, and McDonald’s ad participation will be only a minute and a half, Edmondson says: “This network is not intended to be all about McDonald’s. It is all about the consumer.”

He notes there may be segments about McDonald’s centering on features of the food operation or about philanthropy efforts by Ronald McDonald House Charities.

McDonald’s executives also see their new channel as a way to make their restaurants more than just a place to grab a quick bite — about 70% of the restaurant’s business is drive-though. The programming will offer another reason to spend more time visiting with families and friends in the restaurants, many of which feature playground areas and cafe elements, officials say.

“People today are using our restaurants differently than they have in the past,” says Danya Proud, a spokeswoman for McDonald’s USA. “They’ve become more of a destination. With McDonald’s restaurants offering Wi-Fi, we’ve become more relevant and contemporary.”

With Indoor Direct and other companies in the marketplace offering to put gear in QSR and fast casual dining spots for free and also develop free custom programming, it is a reasonably safe assumption that ChannelPort is taking the risk on the capital and operating costs and McDonald’s gets a diner amenity and perhaps a new revenue stream.

Nothing short of a gun to the temple could get me to stay in Mickey D’s any longer than I had to (did the screaming kids thing along time ago), but no one makes this kind of a financial commitment and gets investor backing without some solid data suggesting the ad recall and ad spend are both there to support this.

ChannelPort is the company that was involved, with Harris, with a small test roll-out in Lost Wages and in California, going back three years. Presumably, this is the long, slow evolution of that. However, there is no press release that I can find and if Harris was involved, they would be making some NOISE as they did when the 7-11 deal was made public.

Optically, it’s good that these sorts of deals are coming together despite the continuing economic woes. However, anyone who follows the digital OOH space knows that just because a big brand is involved, that’s no guarantee it will be any easier to sell the ads and get the rates at a level to make the business model work.

It is slightly odd that there is no evident website for the company (unless this is it) and McDonald’s was only sorta quoted, but not in direct reference to this. The Reuters story has no input from McDonald’s.

Maybe not a big Hmmm, but a hmmm nonetheless.

Image from LA Times. 


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