LinkNYC’s website, found here, claims that it is “for New Yorkers, by New Yorkers”, a claim that is certainly attractive to the large portion of New Yorkers that feel a sense of pride and even nationalism towards their hometown. LinkNYC is a partnership between several technology companies and the City of New York, and aims to provide free public WiFi for New York City.
Outside of simply providing free public WiFi for New Yorkers, LinkNYC is in an interesting place for businesses that want to advertise in certain areas of the city.
LinkNYC is planning on having 7,500 kiosks by 2020 all over the 5 boroughs, neighborhood-targeted advertising has been a core part of LinkNYC’s plan
More specifically, LinkNYC’s advertising rates potential has promised to help local small businesses attract new customers in the neighborhood where their business is located. Unfortunately, it seems as if that may not be the case, as the cost to advertise on LinkNYC is starting to seem not so “for New Yorkers, by New Yorkers”.
LinkNYC are in an awkward place. They are expected to bring $500 million in ad revenue to the City of New York over the next 12 years, but they have promised to keep the price of advertising on their 55-inch flatscreen boards low enough that small businesses can afford to make their mark on the city. Depending on where any given LinkNYC kiosk is located, an advertisement could reach tens of thousands of people per day. Those are extremely valuable views, especially when you take into account LinkNYC’s ability to target neighborhoods with advertisements.
This location-based, targeted advertising is valuable for small businesses, but can also be very valuable for larger companies that have a good knowledge of their customer-base.
Certainly, these large businesses can afford to pay more money for the ad space than the small businesses that LinkNYC aims to support.
Some Statistics:
In order to advertise on LinkNYC, a business will have to pay a minimum of $5,000 for 4 weeks of advertising, which will make a total of 208,333 impressions.
Rate Source: Link NYC advertising package deck
On the other end, a company can pay $15,000 over those same 4 weeks for 625,000 impressions. The difference between $5,000 and $15,000 over the long run for an ad business like LinkNYC can be massive.
Unfortunately, LinkNYC will likely become one of the premier advertising platforms and will force the small businesses out of their ad space. Let’s face it, $5000 is just too much for a mom and pop pizzeria or even a successful restaurant, since it’s impressions that count, and not clicks like it is on the internet.
Do small businesses have the ability to track the effect of advertising? We have asked small business and the answer is a resounding “no”. Are small businesses able to drop the minimum of $5000 of hard earned cash on a difficult to understand advertising concept? The answer is, not any time soon.
All of this sets up LinkNYC to have to make a big decision before the project becomes an integral part of New York City and advertising in the 5 boroughs. Will they prioritize larger companies and potentially more money? Or will they prioritize New York City’s small businesses and have a smaller revenue? Both strategies have their merits, but this decision will shape how New Yorkers view LinkNYC.
Prioritizing Money:
Ad space on a bustling New York City street is incredibly valuable, and despite their focus on helping small businesses, LinkNYC may hear the siren’s call of more money. After all, LinkNYC has experience in the ad business. When you track ownership back far enough, you uncover that LinkNYC is partially owned by Google’s parent company, Alphabet. Google’s entire value and the way they make money come from advertising and capitalizing on their dominance of the internet. It is certainly not farfetched to assume that LinkNYC will take a similar approach to Google (LinkNYC is owned by Google), and accept the highest bidder’s advertisement. This sounds like it may be bad news for small businesses. However, that’s not necessarily the case. Part of the revenue created from these ads will go directly to the City of New York, which benefits the people of the city. This can be thought of as putting more money into the system overall, but less of it going to small businesses and small business owners.
Prioritizing Small Businesses:
Instead of selling the ad space to the highest bidder, LinkNYC can focus more on small businesses, thus allowing them to advertise near their store and get the most bang for their buck, so to speak. This seems like it is strongly in line with LinkNYC’s message of being well-intentioned and trying to help New York in any way they can. However, upholding this promise seems to be one of the only elements this strategy gives them.
From the perspective of the conglomerate that partnered with the City of New York, more money is more money, it does not matter how it was earned.
From the City’s perspective, even though small businesses are a crucial part of the fabric of New York City, having more money in the government inherently benefits them, even if it’s at the expense of small business owners and their businesses.
LinkNYC has the potential to forge a great partnership with New York’s small businesses if they focus on developing small business’s ad presence in New York City.
They occupy a very unique and exclusive space, in which the strategy of targeted advertising can be used in the real world, breaking down New York City by neighborhoods, or even blocks, in order to reach exactly the people that the businesses wish to reach. LinkNYC can take advantage of this by helping local businesses bring in foot traffic that would otherwise not exist.
What Will Happen?
In all likelihood, LinkNYC will stay true to “for New Yorkers, by New Yorkers” and help local businesses. They will do this because their public image must remain positive if people will use the service to begin with. As people more and more attach themselves to companies that they feel are doing the “right thing”, the public image of a company, especially one that provides a public service, is critical. LinkNYC will certainly be aware of the small feelings of distrust that are already building as LinkNYC integrates into New York City. As LinkNYC rapidly expands, we could expect to see just as many movie trailers as you see on them now, but also expect to see advertisements for that coffee shop around the corner, or a bar down the street, or a supermarket on the next block. The possibilities are endless, how LinkNYC manages those possibilities is the mystery.
