Venture

Startups Turn To Traditional Advertising For Attention

On the ride from the San Francisco International Airport into the city, drivers are greeted with a slew of billboards advertising various products from a credit card for startups to Pride-themed data advertisement to a sign that says “Hello Marijuana, Goodbye Worries.”

Arguably, startup funding, inclusion, and weed could be shrugged off as a trifecta of San Francisco’s most well-known stereotypes.

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However it’s how these messages are being communicated that’s gotten my attention. The startups behind these advertisements (Brex, Snowflake, and Eaze) are buying highway billboard space to spread the word about their brands. Ironically, they are using a traditional marketing method for progressive concepts/products.

These companies (and others) are going outdoors, sometimes skipping digitally-native advertisements on heavily-regulated platforms like Facebook, Google, and Twitter to reach more customers.

Eaze, a cannabis delivery company founded in 2014 and backed by $51.5 million in funding, said it uses billboards and physical ads simply because it has no other choice.

Cannabis is a highly restricted and highly regulated industry, and as a result the company has to navigate advertising with stealth according to Elizabeth Ashford, head of corporate communications for the San Francisco company.

Specifically, regulation has restricted Eaze’s ability to advertise online. For example, the company can’t advertise through Facebook, Twitter, or Instagram, and neither Apple nor Android allow cannabis-selling apps on their devices.

Those restrictions have resulted in a drive from Highway 80 to Sacramento that is filled with Eaze billboards.

“It’s less about making a choice to focus on traditional advertising, but more a necessity of utilizing what is available in the industry,” she said.

For what it’s worth, Eaze has a soft spot for locations near In-N-Outs, Ashford laughed. But, operating in the cannabis industry, they are mindful of where they deliver and advertise. Consequently, the company is careful not to place billboards near schools.

About 40 to 60 percent of their customers come through outdoor advertisements.

Brex, which recently raised $100 million for its startup-friendly credit card, doesn’t face the same regulation or stigma of a cannabis startup. But it’s still using the traditional billboard route.

CEO Henrique Dubugras claims Brex, which employed its first outdoor ad for recruiting purposes, is part of a revival for this type of marketing.

“Doing a little never works, you either do a lot or none,” he said during a phone call. “We want to generate the feeling that Brex is everywhere.”

He added that while Brex does place Facebook and Instagram advertisements, he thinks that paid online advertising is overpriced, another reason behind using outdoor options.

Billboards certainly have their space. Ad company Spaceback was even created after founder Casey Saran saw a flurry of cat advertisements in the London subway.

Not-So-Old School

Startup Firefly is capitalizing on this movement as well. The company raised a $30 million Series A last month to help put digital advertisements atop ride-sharing vehicles. The company’s moving billboards are another example of how innovation has driven advertising beyond static signs or online ads.

Kaan Gunay, the company’s co-founder and CEO told me the company offers impact analytics and a wider reach than digitally-native advertisements, which is contributing to the “revolution of outdoor spending.”

“Every single person gets out of their home at some point and does something,” he said. “And that means you’re in the realm of the real world of outdoor advertising.”

Patrick Yang, a partner at Amity Ventures, said Firefly’s popularity makes sense.

“Before, you kind of had to guess if your billboard was working,” Yang said over the phone. “Now there’s data to see how many sales you’ve generated in any given month” through more tech and digital options.

Yang thinks there will be a time when there will be too many billboards that we get numb to this method, too. But for now, attention-wise, it’s working pretty well. So as the sign says, hello cannabis and goodbye worries.

Illustration: Li-Anne Dias