Inside Times Square’s pandemic-era ad world

“The polish and marquee [status] of Times Square never went away,” Five Tier CEO and founder Frank O’Brien told Marketing Brew.
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· 7 min read

Last spring, while we were all locked inside stroking bags of chips with Lysol wipes, marketers weren’t exactly rushing to get ads outside our homes.

Case in point: In the second quarter of 2020, revenues from out of home (OOH) advertising fell 45% year over year, per the Out of Home Advertising Association of America (OAAA).

But for Five Tier—a company that brokers inventory for 25 digital billboards in Times Square, perhaps the world’s most famous advertising hub—it didn’t take long for the rainbow to arrive after the storm.

“The polish and marquee [status] of Times Square never went away,” Five Tier CEO and founder Frank O’Brien told Marketing Brew. Five Tier helps clients place ads on connected TV and digital out-of-home billboards all around the country, but Times Square is its claim to fame.

In TS, O’Brien saw a significant downturn in advertiser interest across the board (no pun intended) in the three weeks following St. Patrick’s Day 2020, shortly after lockdowns took hold; O’Brien told us Five Tier was running half as many campaigns as usual in mid-April 2020.

But he claims things began to steady by May 2020, and that Five Tier has seen revenue increase 2x year over year (YoY) annually between 2018 and 2021.

O’Brien explained that ad prices held steady at an average of $25 per 15-second ad play—or the minimum bid since Five Tier operates on a bidding system. What changed was the level of interest in buying ads, especially for campaigns running in March, April, and May 2020.

“At most, we offered bonus plays or deferred placements at current rates,” he said, adding that some clients bought inventory from March through May 2020, but scheduled campaigns to run at a later date to lock in rates, since the price of inventory is constantly shifting based on advertiser demand.

O’Brien points to a few reasons why Five Tier’s business in the heart of Manhattan rebounded in 2020 despite massive declines in foot traffic throughout the year. For one, digital OOH ads, which are on an upward growth trajectory, fared better than static ones. Plus, Times Square’s place in pop culture helped it stay relevant, even without its usual tourists.

But since the start of the pandemic, O’Brien and other OOH firms noticed changes in the types of advertisers interested in Times Square inventory—as well as the kinds of messaging they want to put in lights.

Secrets to success

All of Five Tier's Times Square billboards are digital, which partly explains why the firm continued to see advertiser interest throughout 2020. On the whole, digital billboards weathered the pandemic better than their static counterparts.

According to AdQuick, an OOH advertising and analytics company that analyzed 7,900 unique pieces of Times Square inventory between March 2020 and June 2021, the average price of a four-week campaign on digital billboards in Times Square has rebounded 184%. For context, campaigns on static billboards have only rebounded 101% throughout the same time period.

Josh Scharfberg, president of OOH media advertising company Clear Channel Outdoor’s New York operations, said essential businesses leveraged the flexibility of digital billboards in the early days of the pandemic.

“Many of those businesses leaned even further into our digital capabilities as they were able to pivot their messages to align with the latest CDC guidelines,” Scharfberg told Marketing Brew. “For some, this meant promoting their takeout or curbside service or their app delivery services.”

Plus, O’Brien explained that advertisers that opted to run ads in Times Square last year were getting more eyeballs than you might think.

“The news shows were still running shots of Times Square. Someone from New York 1 was standing there with a mic, and in the background, if you were one of those ads that was being played, you were getting exposure,” O’Brien explained. He also noted that protesters gathered in Times Square following the police killing of George Floyd.

“I mean, we had more than the pandemic happen last year,” he explained. “There were a lot of companies that wanted to be in Times Square because, sadly, there were still people there because of protests.”

Opportunity knocks

When the pandemic first hit, smaller companies saw an entry point into The Big Apple’s mainstay.

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“We just saw a new type of advertiser come in. A lot of those that were on the smaller size in terms of company size looked at it as an opportunity they might not ever have again, because the expectation was that the rates were going to go down,” O’Brien explained. Celebrity wine app GrapeStars, Ellora Fine Foods, Stuyvesant Champagne, and Moketo Espresso were a few of the small businesses that ran Times Square ads with Five Tier during the pandemic.

AdQuick VP of Growth Chris Gadek also saw smaller brands leverage Times Square inventory last year. He told Marketing Brew that Radical Storage, a luggage storage company formerly known as Bagbnb, ran an ad saying, “We will travel again. Same bag, new soul,” in Times Square for a week in April 2020. It cost between $5,000 and $10,000. Today, that would cost about double, Gadek shared.

“You saw a bunch of smaller companies trying to flex and be like, ‘Hey, we made it [to Times Square]’ even though there was nobody in Times Square. The playbook for them was to take a picture of the billboard and put it on social. We've seen a lot of success with virality of billboards on social media,” Gadek explained.

*Sound of pots and pans clanging for essential workers*

Advertisers leaned into cause marketing last year, a trend that O’Brien told us is persisting. According to O’Brien, cause messaging represented less than 20% of Five Tier’s Times Square business pre-pandemic, but now makes up about 70%.

“I can't say enough about cause marketing during the pandemic,” O’Brien emphasized, adding that “Thank our healthcare workers” and “We’re all in this together” became common tropes seen on billboards last year.

For instance, cannabis brand Cannuka ran a Times Square billboard ad with Five Tier that didn’t have much to do with cannabis at all, but opted for an image of a person in scrubs and a mask with the text “Thank you first responders, health workers, and all of the helpers.”

“You saw a lot of walking the line between not being overly salesy, but more driving around cause marketing and using it to bring people together,” O’Brien said.

Teach For America is a recent example, as Five Tier helped it buy ads in Times Square for Teacher Appreciation Week last month. Teach for America’s Director of Brand Creative, Lizzy Doe, told Marketing Brew that its campaign, which ran for three days in early May on Times Square’s Nasdaq and Thomson Reuters billboards, was more about recognizing teachers than promoting the Teach For America brand.

“Our ad creative featured inspiring messages from people who were impacted by their teachers. We asked people to submit messages to thank a teacher using our campaign hashtag (#thankyouteachers), and then we pulled those messages for our ad creative,” Doe told us.

Looking ahead

Although Five Tier brokers ad inventory in places other than Times Square—54,733 US locations, to be exact—O’Brien feels particularly passionate about this part of his business.

“I walk through Times Square nearly every day,” O’Brien enthused. “I love Times Square. I’m the opposite of most New Yorkers. I’ve loved it since the second I moved to New York, because people plan their entire lives to take their once-in-a-lifetime trips to Times Square.”

So you could say he’s happy that the landmark survived the pandemic. But more than that, he’s confident that not just New York, but also Times Square is coming back. AdQuick estimates that advertiser interest in Times Square inventory, which it measures via the value of proposals sent through its platform, will be up 2.6x between March and August 2021 compared to the same period last year.

“I was walking through Times Square the other day with a billboard owner and he said, ‘You know, I used to hate Times Square. Then I realized we wouldn't have a product to sell here unless there were this many people,’” O’Brien recalled. “So personally, I like Times Square, even if you think I’m crazy.”

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Marketing Brew informs marketing pros of the latest on brand strategy, social media, and ad tech via our weekday newsletter, virtual events, marketing conferences, and digital guides.