MIA on the hunt for a new ad firm

Nov. 1--Passengers at Miami International Airport may soon be seeing advertising everywhere from flight information displays to ticket counter monitors and jetbridges, and the facility may have its first magazine, as part of its search for a new ad company.

Even the parking garages can be named for a price, as MIA Tuesday puts out its first request for proposals for a new advertising firm in more than 13 years, hoping for a new, innovative program.

But the revenue generated may not be a financial windfall. And there are only two major players in the industry, though other companies are nipping at their heels and may join the bidding fray.

A total of 320 locations at MIA will be available for advertising, including displays at ticket counters, gates and baggage claim, luggage carts and jetbridges, and on its website, as well as a request to publish a magazine, said Patricia Ryan, Miami-Dade Aviation's division director for commercial operations.

"Hopefully the new advertising program will be so innovative it will create an avenue for passengers to be entertained and inspired and provide new revenue opportunities for our business partners," Ryan said.

That would include more new technology such as the interactive video wall that MIA's current ad company JCDecaux installed at MIA's Concourse D. Put up a few weeks ago, it is the third such interactive display in the country, after those at New York's JFK and Chicago's O'Hare airports.

But passengers at MIA won't see any ads for cigaretttes or promotions for alcoholic beverages that show people actually drinking. (An ad that shows a small liquor bottle and no one sipping is allowed, Ryan said.)

And nothing too risque. "We are a family-centered airport, so we watch the amount of exposure of a body -- male or female. We try to make sure the clothing is appropriate," she said.

Just two companies dominate the airport segment of the outdoor advertising industry: JCDecaux, which has held the contract at MIA since at least 1994 -- through its predecessors -- and Clear Channel Outdoor, which holds the contract at major airports such as Hartsfield-Jackson Atlanta and Chicago O'Hare, and was recently ranked No. 1 by Fort Lauderdale-Hollywood's selection committee, and is in negotiations with the airport.

Neither JCDecaux nor Clear Channel Outdoor would comment for this article.

But other companies are trying to enter the field, as long-held, politically-ingrained airport contracts come up for bid.

Among those is Corey Airport Services, an Atlanta-based airport advertising firm that has won contracts at Atlantic City and Cincinnati airports and is eyeing MIA.

"Our only concern [at MIA] is they will put minimum requirements in to exclude everyone but those two companies," said Steve Moody, vice president at Corey, who ran JCDecaux's southeast regional office out of Coral Gables until 2001. "We just want a level playing field and to be inclusive of smaller out-of-home media companies and not just the media behemoths."

CBS Outdoor, which, along with other firms, attended meetings on the proposal at MIA, may also enter the bidding.

"We are definitely interested in pursuing the opportunity and seeing if it's something we are going to actively seek," said Jodi Senese, executive vice president of marketing for CBS Outdoor in New York. The company is not at any airport locations, but is at rail and bus terminals and malls.

Overall, the outdoor industry segment is a $7 billion business and the second-fastest growing medium in the ad industry, after internet advertising. In fact, outdoor ads are growing at twice the rate of the total ad industry -- or 8 percent both last year and this year, said Stephen Freitas, chief marketing officer for the Outdoor Advertising Association of America, a trade group based in Washington, D.C.

The airport segment is particularly attractive to advertisers because it reaches white-collar business professionals who travel frequently and are otherwise elusive, he said.

"There is a unique opportunity in airports," Freitas said. "They typically have consumers and travelers who are waiting and have time to kill, which allows the travelers to engage with the advertisement for a deeper, richer experience, and to be able to learn more about the products and services."

JCDecaux's contract at MIA was originally granted for four years, with a three-year extension that took it to Feb. 28, 2001. But since then, it was extended on a month-to-month basis until May 1, 2005, and then on a permit, expiring April 30, 2008. The reason for not putting it out to bid sooner: construction at the airport, Ryan said.

The ad company generated $4.4 million in ad sales in fiscal 2005; $5 million in fiscal 2006, and an expected $5.8 million in fiscal 2007, MIA figures show.

The airport itself, which gets a portion of those sales, received $3 million in fiscal 2005; $3.5 million in fiscal 2006 and more than $3.6 million is expected in fiscal 2007.

Unlike the previous contract, in the new contract, the advertising company -- rather than the airport -- will be responsible for the capital outlay for the fixtures, such as the backlit displays used for the ads. As a result, the percentage of gross revenues generated by the ads will be less than what MIA currently receives, Ryan said.

In fact, the new contract will carry a minimum annual guarantee of $3 million, though bidders can offer more. The airport will get the greater of that minimum annual guarantee or 50 percent of the monthly gross revenues -- or higher, if bidders propose a higher percentage.

"We would hope that we would have no less than the current revenue we have now," Ryan said.

The Miami-Dade County Commission on Oct. 16 voted that wording be added to the proposal, requiring that any bidder disclose whether it has received any notices of any violations of the county's sign code, or is currently in litigation with the county regarding any provision of the sign code.

As of Thursday, neither JCDecaux nor Clear Channel Outdoor had any outstanding violations, said Miami-Dade spokesman Owen Torres. Clear Channel had previous violations that have been corrected, he said.

Expected to be approved by spring, the contract will extend 10 years, with one two-year extension, Ryan said. Bids will be due Dec. 7.

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