In the study on advertising media on public land in the DACH region, 66 of the 292 cities and municipalities contacted took part. The results show that more than two-thirds of all cities are aiming to modernize or digitize their advertising spaces.
The cities often hope that this will improve the quality of the advertising space on offer, combined with a simultaneous consolidation or reduction in the number of locations.
Low digitization rate
Despite the strong need, the digitization gap in Switzerland is still correspondingly wide with a digitization rate of only 1.1% of all areas. Even compared with German cities, which have a digitization rate of 2.4%.
APG|SGA and Clear Channel remain strong
Although important new players have entered the market in Switzerland in the last seven years with Neo Advertising, Livesystems and ESH Médias, the two big marketers APG|SGA and Clear Channel continue to be represented - mostly exclusively - in over 85 percent of the cities.
According to the study authors, this could be one reason why digitization is faltering. Experience shows that innovations - in this case the digitization of advertising spaces on public land - are created in a highly competitive environment and require innovative activities on the part of all market participants, on the part of the marketers, but also on the part of the owners, i.e., the cities and municipalities themselves.
So far, however, the public advertising spaces are neither managed nor administered by the cities and municipalities during the contract periods. The know-how is outsourced and left to the marketer. Cities and municipalities thus voluntarily relinquish their creative leeway during the term of the contract and in the preparation of new tenders.
Better tendering practice
Although 47 percent of contracts still have terms longer than seven years, bidding practices have improved significantly since the price watchdog's recommendations in 2012: terms in Switzerland average 4.5 years, apparently allowing both cities sufficient flexibility and marketers enough time to gain a foothold in cities and successfully commercialize inventory.
Swiss cities are optimistic about the future. 78 percent of the cities expect an increase in the amount of concessions in new tenders: 28 percent of those surveyed even expect financial increases of over 50 percent. The results of current tenders, such as those in the city of Zurich for VBZ Zurich or the city of Schaffhausen, far exceed this target, especially if advertising spaces are modernized or digitized on a larger scale.