As the fastest growing airline passenger market in the world, Asia Pacific will soon account for almost 40% of total global passengers and the number of business decision makers, high net worth individuals and millennials taking to the skies hass never been greater.
No wonder that VGI Global Media, who already operate a number of highly prestigious transit advertising contracts across the region including KLIA, KLIA2, and Senai Airport here in Malaysia, want to be the captain of this flight.
First advertising gateway to Malaysia and beyond
Despite having only been here a few months, VGI has kicked off its plan to transform KLIA 1 and has revamped the International Arrivals Hall digital screens. Todate, three of the four advertising spots are being sold on a long-term basis even before VGI Airports completed the installation.
We speak to Jonathan Goldsmid, COO of VGI Airports in this special feature…
What brings you to this part of the world?
It was actually a call out of the blue. For the past seven years I have been living in Italy working for Clear Channel International where I was responsible for developing and managing an extensive airport advertising business there covering Rome Fiumicino, Venice, Bologna and two airports in Southern Italy whilst also overseeing the development of the groups’ airport business across the region.
One afternoon I received a call from an old business acquaintance of mine in Thailand asking me if I’d be interested in a move to Malaysia to spearhead the development of their airport advertising business across the region.
Having fallen in love with this part of the world as a result of traveling throughout the region for both business and pleasure, I previously ran an office in Singapore whilst CEO of Aviator, part of Kinetic Worldwide, it was enough for me to find out more.
After a couple of market visits and getting to meet the shareholders of VGI, it was clear to me that there was a meeting of minds in terms of the potential for the business and what it would take to realize this.
Why Malaysia and why airports?
Through what was originally a joint venture to manage the advertising contract for the MRT in Kuala Lumpur, VGI agreed to also take on the management of the advertising contract for KLIA, klia2 and Senai airports.
Airport advertising is a very specialist and niche business that requires specific knowledge and expertise to run effectively, something VGI knows how to do through a combination of the people who work at VGI and the contracts it manages in airports in Thailand and Myanmar through another of its companies.
We have already kicked off a “reset plan” that will see us transform the advertising program at KLIA making it a regional and international benchmark in terms of technology, innovation and quality and through this eclipse what has been done at other airports in the region including Changi and Jakarta.
As a specialist transit advertising operator, we see airports as one of the most exciting areas of the business. More people are taking to the skies than ever before and by 2040 Asia Pacific will command almost 50% of total global passengers.
How does VGI airports’ plan to differentiate itself from the competition?
People, mindset and the innovative application of technology.
I believe what is missing today is a more collaborative approach and mindset rather than a silo mentality to managing the advertising business inside airports.
Advertising is just one of many different concession businesses operating inside the airport so I believe its incumbent upon us to forge more of a genuine partnership type mindset and approach to working with airport operators.
We believe this will create a new level of trust and collaboration that not only allows us to focus on delivering a great advertising business but sees us supporting the broader strategic goals of the airport and working more closely with other concessionaires.
Just as an example, we generally have most of the very best located advertising units around the airport so why not under a different and more collaborative model, allow the airport and other concessionaires to utilize our media assets to help improve their businesses rather than it being a straight forward “paid for” transaction.
Whether that is through utilizing our new digital screens to help create a sense of place as we have already done in KLIA, to drive footfall to F&B outlets or to update passengers on important flight changes, digitalization of our media now means all of this can be implemented with ease.
But to do this we have to start with our people.
We need people that are not only the best at designing, developing and implementing spectacular advertising programs and then great teams to market these solutions but people who understand airports in general, who understand the challenges of our partners the airport operators. Without people like this we are no more than a media sales company.
Here is SE Asia we now have a team with more industry experience than any other company operating in this field in the region.
Between myself, the CEO of VGI Malaysia and our new Chief Digital Officer, Ignacio Perez, a long-time colleague with more experience in digital technologies than anyone I know, we have amassed over 70 years of experience in the airport advertising business which has included either directly managing or being involved in the management of some of the world’s best known airports.
Our Marketing Director Chandran Ravi brings extensive aviation related experience with stints at both Air Asia and Malindo. Our Sales Director Cerina Tan comes from the premium consumer print industry where she ran sales at Malaysia Tatler and Prestige magazines, an audience and advertiser base that is very much aligned with the premium environment and audience of airports today.
The third critical ingredient is technology.
Airports by the mere fact that they involve getting millions of people into the sky every day, are one of the most technologically advanced and high-profile environments you could operate in.
As a result, airports have always been a magnet for brands seeking to benefit from the association with this type of environment and technology, build trust with the airport audience and been seen as pioneers and innovators in their fields.
Long recognized as a prime platform for brand building, as a result of the smart application of technology, we can now do so much more be it through specialist activation projects utilizing digital technologies, the use of beacons and facial recognition technologies to help advertisers target specific audience demographics or bespoke programming that allows us to link flight information to our screens, so when baggage from Turkish Airlines is coming out onto carousel 5, the advertising communication on the screens on that carousel is in Turkish as well as the local language.
What makes airports different from other OOH formats and media platforms in general?
If you are referring to our strategy to treat airports almost as a stand-alone business you are correct.
Whilst we are extremely fortunate to be part of a much larger media company, which in turn provides us with important support both in terms of capital, an essential ingredient when developing airports, we have a set of shareholders who understand that airports are different to other OOH platforms and require a highly specialist approach.
The simple reason for this is that whilst airport advertising largely shares the same advertising format as OOH, be that large format backlit advertising units or more commonly nowadays, digital screens in different sizes and formats, this is often where the commonalities stop.
The airport audience is often more aligned with premium B2B and B2C platforms. That’s the reasons you will often see the same advertisers in airports as you will see at an international level in Financial Times or the Economist printed and online versions or at a national level here in Malaysia in The Edge or Malaysia Tatler magazine.
The one difference being that the airport audience is one of the few audiences that continues to grow exponentially versus traditional media platforms that continue to experience audience decline.
So by large we are talking about a very different audience to other OOH formats and with it very different sales cycles, pricing models, advertiser needs and contract terms.
What this means is we need a completely different approach to the business, from the core client base we are engaging with, to the type of conversations we are having with these clients to the solutions we are developing inside the airport itself.
Will 2019 strategies and beyond be applied regionally?
I think it’s clear that our vision and aspirations are regional, possibly even further afield. At the same time, we know from experience that stretching out too thin, too fast is a very dangerous game.
Our objective remains clear: to enter into partnerships that add value and deliver strong shareholder performance.
There are also plans to expand the understanding of airport advertising; this is so marketers and creatives will quickly realise the value proposition.
We are currently working with our tech partners locally so that, in the very near future, the welcome message will be sent in the language of the passengers who are moving into the Arrivals Hall.
Our Chief Digital Officer is currently working with local and international technology partners on a number of back-end and front-end systems; most of which will not only allow us to better understand our audience in terms of who they are, but also how they move through the airport.
That way, we can learn how they interact with our advertising.
Being able to gather such intrinsic data will allow VGI Airports to better engage with passengers or specific selected audience profiles.
What VGI Airports intends to do is to not reinvent the wheel. After all, these are projects and technologies that have been in use globally within airports and transit environments.
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