MBTA officials think the agency could more than double advertising revenue within two years if it takes a number of actions, including reversing course on a 2012 decision that banned alcohol ads on T property.
In a presentation to the MBTA’s Fiscal and Management Control Board Monday afternoon, officials outlined a path that could see the T collect nearly $26 million in ad revenue next year and $36 million in 2018, up from the $17.1 million the T plans to collect this fiscal year. The ideas were put together by Titan, the company contracted by the T to sell ads.
“Something they believe would have an immediate impact is alcohol,” MBTA Chief Administrator Brian Shortsleeve said.
Allowing for the return of alcohol ads could represent a $1.3 million boost next year, according to the presentation.
The T opted away from alcohol advertising as a substance abuse prevention measure in 2012. Then-State Rep. Marty Walsh, a recovering alcoholic, was pushing at the time for a law to ban alcohol advertising from all state property, and praised the T’s decision.
Today, Walsh is Boston’s mayor. He said Monday through a spokeswoman that he would disapprove of bringing alcohol advertising back to the T.
“The mayor would not be supportive of the MBTA going back on its commitment to limit exposure to alcohol advertising on our public transportation system, which now transports the majority of our seventh and eighth graders to and from school everyday, and he does not believe it would increase revenue for the T,” spokeswoman Bonnie McGilpin said in a statement.
While Walsh opposes alcohol advertising on MBTA property, some bus stop structures in Boston are owned by the city, not the MBTA, and sold as a canvas for alcohol advertising, according to Monday’s presentation.
Asked about the discrepancy between that practice and Walsh’s position, McGilpin said: “The city’s policy is that alcohol is not advertised on street furniture within 500 feet of schools, parks, churches or community centers.”
Shortsleeve said the ideas discussed Monday were not recommendations, and that they were meant to give insight into possible action as the control board seeks to balance a large gap in the T’s operating budget. He acknowledged during the meeting that municipal leaders may not approve of all of the options on the table.
“We operate in the city of Boston, we operate in lots of communities,” he said. “Those communities have a lot to say about things like ... certainly our policy of whether or not we’ll advertise things like alcohol. As we go through this process we just need to be aware that there’s a lot of stakeholders who historically have had a lot to say about the way the T approaches advertising.”
Alcohol is just one way the T could boost ad revenue, and it’s not the most lucrative. Adding new screens at stations to display digital ads could be the biggest money maker, bringing in $3.5 million next year, MBTA Assistant General Manager of Customer Communications and Marketing Rose Yates said. These screens, which would be bought and installed by Titan, could also display train arrival times, she said.
Another option: allowing companies to sponsor stations or lines. The T has in the past batted around the idea of letting companies pay for naming rights to stations, but that would not be the case in this model, Yates said.
“We keep the station name in place,” she said. “[A sponsorship] would include heavy advertising or dominations, which is when you buy up all the advertising in one particular station that’s available.”
The T could also pursue other forms of “specialty” advertising. An example of what that means could be seen at New England Patriots home games, Yates said.
“We want to take sports advertising to the next level by wrapping our trains to Gillette Stadium and placing them at the stadium at the game,” she said. “It’s a live billboard with thousands and thousands of eyeballs on it, which makes it quite valuable.”
Ad revenue is far from the sorest of spots for the financially troubled T, as it set an agency record in September by selling $3.6 million worth of advertising in the month. (The agency got to keep $1.9 million, with Titan taking the rest as part of the agreement.) But Yates said that in terms of ad revenue per rider, the MBTA is still below average when compared to the 10 largest agencies in the country.
The control board, put in place as a key part of Gov. Charlie Baker’s MBTA reform effort, has been directed to find as much money as it can from existing revenue sources in order to close the T’s wide operating budget gap. Advertising has been often mentioned as an area to grow.
However, in the grand scheme of things, advertising revenue—equating to a maximum of an additional $9 million next year—looks like a relatively small chip off the $242 million deficit.
Other ways to balance the budget will be discussed in the coming weeks and include finding more revenue from real estate holdings, ensuring fares are being collected, exploring state assistance to deal with debt, and cutting costs at the agency. Of all the options, the cost-cutting measures represent the biggest chunk in the preliminary plans T leaders have put forward.
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