Walk onto any T station’s platform or train and the scene is usually the same: ear-budded riders staring at their mobile phones. Is anyone looking at the advertising plastered all around them?
Advertisers seem to think so.
The Massachusetts Bay Transportation Authority’s revenue from ads rose 32 percent to $31 million in its fiscal year ended in June.
Nationally, advertising spending increased about 8.2 percent in 2015, according to the Standard Media Index.
“I know that it sounds like customers never look up from their phones. But the truth is, a lot of customers look up,” said Rose Yates, assistant general manager of customer communications and marketing for the MBTA.
The cash-strapped MBTA believes it can further increase ad revenue, and is looking for a new partner to help. For the past 11 years the authority has used Intersection Co., a New York technology and media company that works with advertisers and oversees the installation of their ads, but the T says it wants to bolster its digital capabilities.
Intersection could not be reached for comment.
The MBTA sent out requests in June for new contract proposals that will focus on more digital advertising and how to connect better with commuters. It received a number of bids in July, and a selection committee is reviewing them.
The committee will present what it decides is the best bid to the Fiscal Management Control Board, which now oversees the MBTA. The board is expected to approve a new contract in September.
There are two parts to the bids.
The technical component describes how companies plan to install digital advertisements and what their process and timeline would be.
The financial component explains how they plan to generate revenue.
The MBTA knows that its print advertisements are effective, but that digital is now the way to go. It started looking into digital ads in 2005, and when the Silver Line was constructed that year, digital advertising spaces were built in three of its stations.
The MBTA currently has 80 digital screens in seven stations and 10 screens on the streets. The authority reported a 98 percent gain in digital ad revenue to $5 million for the most recent fiscal year.
However, print advertisements still make up about 80 percent of the ad revenue. The MBTA is hoping for more digital capabilities, not just for revenue but as a new way to communicate with commuters.
“The way we are looking at the new digital screens is what can these screens do to enhance the customer experience,” Yates said. “We don’t want to just serve advertisements; we want to use those screens to serve critical information.”
The screen would display ads along with information like train times and weather reports, and the MBTA wants the ads to pay for them.
It anticipates 200 percent growth in digital advertising in the coming year and plans to install 500 more screens in the next three to five years. Some will take the place of print advertisements, and some will be in new locations.
New subway cars being built for the Green, Orange, and Red lines will include digital screens.
This new contract comes at a time when the transportation authority faces a potential $110 million deficit, caused partly by declining sales tax revenue, which is expected to bring in $32 million less than anticipated in state funding.
“The goal is to always continue to grow ad revenue. The financial situation we’re in is a serious matter, and any additional revenue we can get from advertising helps against the deficit,” Yates said.Hae Young Yoo can be reached at email@example.com. Follow her on Twitter @HaeYoung_Yoo.