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Despite struggling sales, city adds tram ads

(April 10, 2015) Despite their lack of popularity with Boardwalk business, and a fair amount of internal skepticism voiced this week, resort government is still moving cautiously forward with tram-top advertising.

The city’s Transportation Commission decided this week to add advertising panels to two additional tram coaches, bringing the total number of equipped coaches to 10 out of the city’s fleet of 16.

This is even though only seven coaches have so far been sold. Local interest has been limited, likely because Boardwalk merchants have previously described the additions as tacky and “just ugly.”

Nevertheless, city officials – particularly Mayor Rick Meehan – desired to press onward.

“People in Ocean City have a tendency to wait until the last minute to get their plans together,” Meehan said. “The visual of the panels this year will encourage people to buy them next year.”

Meehan was also particularly critical of Direct Media, the company that holds the state-funded contract to sell advertising on municipal transit.

The issue seemed to be how the panels were being grouped for sale, or whether that even made a difference. Each tram coach has three panels: two long ones running along the each side of the roof, and a smaller one at either the back of the car, for rear coaches, or the front of the car on front coaches.

Originally, all three panels were being sold as set, at a price of $13,500 per season. However, because of a less-than-stellar reception, Meehan and City Manager David Recor had suggested that panels be sold individually, at a lower price point.

“Breaking the panels up so the sum of the parts added up to the original price … was what we anticipated,” Recor said.

However, Direct Media’s feeling was that selling individual panels would not make them more palatable to small businesses and that doing so would jeopardize the interest from larger clients who wanted to buy in three-panel blocks.

“I don’t want to say it’s outside [local businesses’] price range,” said Susan Maex of Direct Media, who attended Tuesday’s meeting. “I have clients here who easily spend $60,000 on a bus wrap. We didn’t have anyone coming back to us saying, ‘Can I buy just one panel?’”

Despite the suggestions from Meehan and Recor, it appeared the full City Council had never made any formal decision on where to go.

“Susan is aware that the council sets the parameters,” said city Public Works Director Hal Adkins. “But at no time was I given the directive to tell Direct Media to change direction.”

Installation of the seven coaches’ worth of ads that have been sold is not scheduled until May, leaving some time left to sell. Meehan advocated offering single panels now, believing that some local businesses had not yet finished their plans for the summer.

However, Maex said it “would be really bad business” to offer single panels now that seven clients had already been lined up under the assumption that only whole coaches were being sold.

Those seven clients are Tanger Outlets, the Department of Health and Mental Hygiene’s smoking quitline, MarDel Watermelons, Lennar Homes, Ocean Downs Casino, Dippin’ Dots, and the State Highway Administration’s pedestrian safety campaign.

Regardless of whose sales strategy was right, the rest of the commission agreed with Maex that single-panel sales were not an option for this year.

“This year, we have to do a cluster of three. It wouldn’t be fair to the people who already bought,” said Council Secretary Mary Knight. “Next year, we could change the program.”

The issue of continuing with the program comes with the fact that the advertising panels aren’t free. Each coach costs $7,118.75 to build, install and wire the structure to the tram roof, Adkins said. Printing of the ad plates costs $1,500.

“I’ve already flowed $60,000 into building the first eight coaches, but I have the revenue coming back [from the seven that have sold] to cover it,” Adkins said. “We can’t say that about another eight.”

“Unless there’s an underlying current out there that I’m not aware of, we’re not getting that feedback,” Adkins continued. “I don’t want to be the guy who spends another $60,000 to build stuff he can’t sell.”

Even if not sold, any excess panels could be used to advertise city events, such as Sunfest or the Performing Arts Center shows. But these ads would not generate any revenue.

Given the costs of the eight coaches already done versus the income from the seven sold, Councilman Tony DeLuca calculated that the city was still making about $25,000, even if nothing else was done.

Thus, installation on two more coaches, as well as the cost of printing signs for those two and the current unsold one, could be covered without the city losing money.

“Why don’t we just add two more, and even if it goes nowhere after this, we still have three coaches to advertise our own stuff on?” DeLuca proposed.

The commission voted in favor of the idea with Councilman Dennis Dare in opposition. Dare, along with former council members Brent Ashley and Margaret Pillas, had voted against the tram advertising program when it was first brought to the council last year.

“I didn’t like it then, and I still don’t,” Dare said.

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