Is it the right time to revive the ATM wrap?

Alternative Display Systems (ADS), a division of New York-based advertising and marketing company R.U. Advertising, believes it is.

Wraps, sheets of heavy-duty vinyl applied to an ATM, were one of several advertising alternatives offered to deployers who hoped to sell space on every inch of their machines as a way of generating new revenues.

Some big players, including Diebold, conducted wrap pilots in 2000. But like other forms of ATM advertising, including toppers, receipt coupons and screen ads, there was little real market penetration.

After several ATM advertising companies -- including Satmark Group, Ten Square and RBuzz USA -- went out of business in 2001, most folks in the ATM industry began focusing their efforts on other opportunities for revenue generation.

However, Sherman Arnowitz, an ADS partner, thinks ATM wraps deserve another shot. Wraps are getting good buzz in other industries, he said, including airlines interested in using them on trays and golf courses interested in wrapping carts.

It's a start

With the help of Atlanta's United Financial Marketing Incorporated, ADS has created a database of 30,000 potential ATM wrap locations -- more than half of them under contract with a single deployer. Rick Freeman, president of United Financial Marketing, said he is also in talks with another ISO that manages nearly 10,000 ATMs.

That's enough to make a pitch to the agencies, said Arnowitz, noting that the 30,000 ATMs are located in most major metro areas in locations ranging from grocery stores to amusement parks to adult entertainment clubs.

New York's Alternative Display Media hopes to revive the ATM wrap.

"We've got every different type of location, with every different type of demographic, an advertiser could want," he said.

Freeman, who also runs an ISO called ATM Technologies International Incorporated, said that the consolidation of ATM portfolios is making it easier to get the "critical mass" of locations sought by advertisers. Lack of mass thwarted many previous ATM advertising efforts.

It remains difficult to convince ISOs -- a naturally skeptical crowd -- to add their ATMs to an advertising database. The problem may be exacerbated by Freeman's own management of 300 ATMs in several southern states. 

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Yet Freeman said he believes ISOs with whom he's worked have confidence in him. "I did some sales for Hanco (which was acquired by eFunds in February of 2002), and I worked hard for them on that side of the business," he said.

Dollars and sense

ADS is going after national accounts rather than local/regional advertisers so that it will be able to command better rates, Arnowitz said. ADS expects to charge $400 a month per machine, with a minimum three-month contract.

The deployer will likely be offered some 25 percent of that amount, Arnowitz said, which he can split with the ATM owner. The remaining 75 percent will be split among ADS, United Financial Marketing and the agencies that serve as an intermediary between ADS and advertisers.

Of the 30,000 ATM locations, Arnowitz said that some of them will be "heavy hitters" that may command even higher advertising rates. "We hope to build a waiting list for some of them and be able to charge a premium for them."

If certain locations prove to be desirable to advertisers, it will make it easier for ADS to obtain new sites, he said. "For every deli in Manhattan that is prime real estate, there will be one across the street we don't have."

Arnowitz said that ADS has targeted 250 agencies "worth hitting" and has presented the idea to about 75 of them in the past 10 months. About half showed interest in the idea, he said.

Agency view

Ruby Gonzalez, a media planner for Publicis Sanchez & Levitan, an ad agency with offices in New York, Los Angeles, Dallas and Miami, saw ADS' presentation in late 2002.

Gonzalez said she likes the ability to place ads in retail environments where the advertised products are sold, as well as the concept's highly visual appeal.

"If you put a tiny little logo on an ATM, nobody sees it. But if a wrap is vibrant and bright, the whole world will see it," she said.

Gonzalez pitched the concept to a candy company. "I thought it would be really effective on ATMs in grocery stores. IIf children are at the store with their parents, (the ad) would be right there in their faces," she said.

The company passed, Gonzalez said, because its target -- children -- don't have ATM cards of their own.

"Clients are not always adventurous," Gonzalez said, especially in a tough economy. "When money is tight, people are scared to spend it on something new."

Gonzalez said that "absolutely" she will offer the wrap concept to other clients.

Upfront costs

Pamela Barron Leach, director of Diebold Direct, which worked with beverage company Snapple on a seven-city, six-month ATM wrap pilot in 2000, said that while she is convinced that wraps are a "winning concept," it cost more than expected to create and install the wraps.

It's a familiar Catch-22, Barron Leach said. "ISOs don't want to spend more money than necessary on their machines. Banks have more to spend, but they don't want to invest in anything that might conflict with their conservative image."

Longtime ATM advertising veteran Don Jarecki, who ran EDS' full-motion video advertising program in 1997-98, echoed Barron Leach's concerns over cost.

"Any form of ATM advertising that requires that amount of manual effort is going to be difficult to cost justify," said Jarecki, vice president of business development for CashPoint. "What will you have to have to charge to recoup your costs, and will you be able to get anyone to pay it?"

"Not just anybody" can install wraps, said Jody Henry, vice president of sales for FB Johnston, a company that produces equipment markings and signage for clients like BP. "With a concave surface like an ATM, you're going to have wrinkling and bubbling issues. It's kind of like trying to take a basketball and gift wrap it."

Wraps can be produced for as little as $5 a square foot, Henry said, but only in larger volumes.

The highly diverse composition of most ATM networks presents a challenge, Henry said. "If you have to come up with wraps for five or six different units, you can't get any economies of scale."

Arnowitz said that ADS is focusing on the side and front panels of ATMs to minimize the costs of producing wraps.

FB Johnston, which produces custom ATM panels for Triton and its distributors, is developing side panels of a rigid polycarbonate material that Henry said may be more cost effective and durable than wraps.