Making direct sales more flexible: A conversation with Simon Property Group & Broadsign

January 13, 2022Rob Côté

In December 2021, we were proud to sponsor the DPAA Town Hall Members Meeting. Every year, this event brings together DPAA members to discuss what lies ahead for the OOH industry. As a part of the event, Karim Kanji, one of our North American sales directors, took part in a fireside chat with Simon Property Group Senior Vice President Chip Harding. The discussion centered on how Simon was able to adopt a more flexible approach to business and how this helped it to survive the restrictions and uncertainty presented by the COVID-19 pandemic.

The world’s largest retail real estate company, Simon Property Group owns more than 200 shopping centres and premium retail outlets. It also operates a DOOH network in its locations, which runs ads from retailers, financial institutions, and CPG brands. With retail particularly hard-hit in the early waves of the pandemic, Simon knew it needed to adapt, and do so quickly. The discussion between Chip and Karim highlights how Simon Property Group was able to introduce greater flexibility to its business, in part by leveraging the capabilities offered by programmatic digital-out-of-home. Just as importantly, it delves into the ways that programmatic’s pandemic-era growth is likely to shape direct sales in OOH moving forward.

You can watch the full video here, or read on for our recap of some of the key takeaways from the conversation.

Closed doors, open windows

Two years in, it’s worth the reminder that the changes forced by the first wave of the pandemic were beyond just about anything seen since the end of the second world war. In retail, businesses were suddenly forced to rethink and restructure operations almost entirely, from the ground up.

On March 18, 2020, Simon Property Group decided to close all of its 250 shopping malls across North America. This was something which, up until that point, had never happened before. While Chip stressed that this was the right decision to make, temporarily shuttering all properties and keeping doors closed for about three-and-a-half months—or 11,000 working days—further reinforced a need to adapt how Simon ran its OOH network. At the time, Chip said the company had 5,000 agreements with advertising and promotional partners running at that time that still required managing and nurturing. More of its advertisers were looking to pivot messaging, too, focusing on health and safety rather than some of their existing campaigns.

For an industry like retail, which is still fairly traditional in many ways, stepping out of the comfort zone and embracing the unfamiliar was a big, necessary step. To name just one trend, many retailers took the opportunity to invest in developing their e-commerce or BOPIS (buy online, pick up in store) offerings.

For Simon Property Group, the key idea was simply to take steps to improve its ability to operate flexibly. This meant investing in new technology and processes, such as adopting programmatic sales for its network of DOOH displays, and undertaking a rethink of how it did in-mall OOH media entirely.

The programmatic difference

Chip explained that tailoring Simon’s new approach required the team to change its operational workflow and bring on more employees to work on the back-end. So, at the start of lockdown, Simon Property Group brought on Broadsign Reach and began laying the groundwork for launch in 2021 by investing in employees and resources. Then, in 2021, with all properties open to the public, the team went live again. These efforts have been quite successful, going from zero dollars to seven figures of revenue generated by the end of last year. Chip shared that back in January 2021, Simon Property Group had just one programmatic campaign running across its entire DOOH network. By November, the number had grown to 600 in total.

He attributes its growth and success to the fact that programmatic can provide insights, learnings, data, and impressions to help them run campaigns that audiences respond to. This is in addition to programmatic’s ability to attract new clients, provide access to omnichannel campaigns, and help create more compelling advertising experiences. Towards an ultimate end goal of driving sales, programmatic has been a key instrument for Simon’s success.

How programmatic will reshape direct OOH sales

As Karim points out early on in the conversation, direct sales still account for the lion’s share of transactions in the OOH space. While that’s likely to continue, at least for some time, it’s also likely that the rise of programmatic will drive interesting changes in the way that direct sales are conducted.

For starters, the greater flexibility offered by programmatic is something that is also going to become the norm in direct sales. It’s the kind of thing buyers crave, and while it does present a few additional challenges for sellers, media owners ultimately must meet the demand of their customers.

Another key area where programmatic is likely to have outsized influence is in reporting metrics. Programmatic transactions demand extensive reporting capabilities on the part of the media owner. It’s what allows a buyer to plan and execute campaigns that reach their desired audience, and without it, programmatic wouldn’t be much of anything. But buyers who prefer direct purchasing agreements want that level of data and transparency, too. Organizations with programmatic programs will be well-positioned to give it to them, but it’s also likely that it will become a standard ask made of any reputable OOH business.
But it’s flexibility and reporting together, ultimately, that are going to create the kind of package that buyers want to see. And there’s real benefit in it for media owners, as well. If media owners can create predictable KPIs on a campaign by campaign basis, he says, the end result should be significant revenue growth.

Opportunities and challenges ahead

Today, Chip said that Simon is investing in training its entire sales team on programmatic transactions. The goal is as much to ensure everyone knows the vernacular of programmatic and understands the potential outputs as it is to continue growing the programmatic business. The lessons learned will be invaluable assets as Simon looks to continue down the path of a more flexible and data-rich direct sales operation.

If there are challenges ahead, they’re largely in the sphere of yield management. Greater flexibility will require a fairly extensive rethink of what it means to manage yield in DOOH effectively. While Simon has some ideas it is trying out, the issue remains one to be settled.

Still, with the world mostly open once again and with much progress towards a reimagining of DOOH made in 2021, Chip and the Simon team are excited to see what the future holds for its new, more flexible approach to DOOH.

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Rob Côté
Rob Côté

Demand Generation Manager