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JCDecaux in the new era of digitisation
Cities are undergoing far-reaching changes. The same goes for JCDecaux. The transformation brought by digitisation and connectivity is having a huge impact on the way we view and conduct our business as the world number one in outdoor advertising. We need to seize and harness these new opportunities, while respecting the General Data Protection Regulation. We must also take advantage of these opportunities to continuously update and improve our service offering. And finally, we need to accept the new responsibilities that all of this brings.
Responsibilities with respect to citizens, first of all, which means designing products and services that will be useful to the greatest number of people and efficient when it comes to energy. Then there are our responsibilities to local authorities, which means offering them a solution that meets the expectations of city users, while enhancing the urban landscape. Finally, we have responsibilities to advertisers, to provide them with the best in new technologies to better showcase their brands. Digital is everywhere- our means of transport, our professional activities, our leisure activities and our personal life -and holds tremendous promise.
A host of challenges awaits us. We are among the most advanced traditional media groups when it comes to transformation, investing in two key areas.: Firstly, the development of energy-efficient digital screens, and secondly, programmatic advertising, with the international, independent, automated planning and trading platform VIOOH, and Data, which enable us to reach targeted audiences with perfectly tailored and scalable content at a specific point in time.
As cities are transformed, the pace of urbanisation increases and all city services and infrastructures go digital, we are proud to play a key role in this reinvention. Proud of our capacity to innovate to help urban landscapes and Smart City usage evolve.
The rollout of JCDecaux’s increasingly digital street furniture has been gaining momentum. London, for instance, got it right: loyal to its avant-garde tradition, the UK capital now has the largest network of digital bus shelters in the world, with soon 900 84-inch screens. In the US, JCDecaux has successfully digitised New York's Fifth Avenue, the most expensive and busiest shopping street in the world, fitting its bus shelters with the world's largest street furniture displays (98-inch screens). Meanwhile, Chicago is now the first US city to allow animated content on digital street furniture. The Yarra Trams contract win in 2017 has also enabled the digitisation of 300 tram-shelters in Melbourne, Australia. France has also played a central role in this drive to digital: nearly 30 cities, including Nantes, Nice, Mulhouse, Besançon, Montpellier and Perpignan, are now equipped with digital screens. Digital communications are therefore creating a new dynamic across cities worldwide. In 2018, digital communication accounted for 20.4% of our sales, and the pace is set to pick up over the next few months.
Our self-service bike rental scheme, which is in operation throughout the world, is also going digital. In 2018, we launched our new mobile application. Beginning in Lyon, it progressed to Nantes and subsequently across all contracts won or renewed in respect of the systems, such as in the city of Luxembourg, one of the first of the world's capitals to have an entire fleet of electric self-service bikes. This ground-breaking innovation, which has already been adopted by 65% of users, facilitates the use of eco-friendly solutions by all, the sharing of information between cyclist communities and the management of the fleet of bicycles by our Cyclocity teams.
Major transport hubs are also experiencing a digital revolution, with airports leading the way. In 2018, we installed Europe's largest digital platform in the duty-free area of Charles-de-Gaulle airport in Paris, featuring a digital 80m² screen. The Digital Square provides a powerful opportunity for driving-into-store, a central feature of the new Parisian shopping concept, and ensures maximum visibility to a strategic audience of global shoppers with long dwell times.
Globally, we recently extended our exclusive partnership with Dubai International Airport, for which we are now providing latest-generation displays, including a curved, 70m² digital screen. This partnership will also see us co-create an open innovation programme in conjunction with Dubai Airports, aimed at developing new ideas, with the launch of a start-up lab. Meanwhile, we were also major contributors to the design of the new terminal 2 at Guangzhou Baiyun airport, which is now one of the most digitised airport platforms in Asia. Over 1,500m² of exceptional digital systems have reinvented airport advertising, including the 360 , with its three giant LED archways spanning nearly 50m² each, and also the Immersion under a huge screen in the shape of a 56-metre long wave.
We now have a presence at over 210 airports in 38 countries and continue to push ahead with our global-scale expansion in high-performance, high-impact outdoor advertising solutions. Airport advertising is a fast-growing media channel, driven by passenger traffic of more than 4 billion people in 2018 and this figure is set to double by 2040, according to ACI forecasts. With this in mind, we are proud to announce the launch in February this year of the first ever international airport audience measurement (AAM) system. After a trial run at Paris Airport and, subsequently, Changi Airport Singapore in April, the system will be gradually rolled out across the main airport hubs operated by JCDecaux.
Railway stations are also seeing a digital revolution, particularly with the stations managed by Network Rail in the UK, which will enable us to deploy interactive information screens for facilitating passenger journeys in cities including London, Manchester and Glasgow.
Retail is another sector in which digitisation comes into its own. In 2014, we launched a network of digital screens in the UK to target consumers based on their purchasing habits. Installed at 400 of the largest Tesco supermarkets, the displays provide optimised broadcasting of adverts based on more than 11 billion items of available customer data. Since 2018, we have installed more than 100 screens in Monoprix and Monop’ shop windows in Paris and the Paris region, strategically positioned along customer pathways. With over 800,000 customers per day, these retail outlets see an average of nearly 3 million customers pass through the check-outs each week. This is an unprecedented initiative in terms of campaign data-planning and contextualisation and stands to gain momentum in the coming months with 150 new screens to be installed in several French cities. We have also been managing indoor advertising solutions in the Westfield London and Westfield Stratford City shopping centres since November 2018, representing some 180 screens in an all-digital environment.
Finally, a number of unique installations have been deployed across the world. We unveiled a digital sculpture “The Kensington”, created by Zaha Hadid Design, combining street art, contemporary design and digital media. The spectacular structure is located on West Cromwell Road, the main route from Heathrow Airport to central London. The Kensington provides a clear demonstration that digital screens can also become the centrepiece in the architectural enhancement of urban environments. Elsewhere, our digital network of 60 large-format 111m² billboards on Chicago's motorways broadcasted more than 23 million municipal information messages, in addition to advertising campaigns, last year. In Nigeria, we installed a network of 92m² digital arches in Lagos in 2018, providing drivers with traffic information in real time and suggesting alternative routes where necessary.
Today, JCDecaux operates 29,000 screens in over 40 countries. As the world's population becomes increasingly mobile and connected, expectations are changing and are now focusing on digital Out-of-Home (DOOH). Although it still accounts for only a marginal share of outdoor advertising installations (5% of assets), DOOH, which first emerged in 2009, is expected to generate sales of €18 billion worldwide in 2019 (source: PWC), which is 40% of the outdoor advertising market. It will be the second fastest-growing media in the world over the next three years, with an annual growth rate of 11.5%, just behind mobile Internet.
This digital screen revolution is being accompanied by a revolution in data usage. In June 2018, we launched the VIOOH platform, designed to accelerate growth in outdoor advertising and bolster its competitiveness, facilitate media buying for agencies and advertisers, and connect brands to the right audiences, all while ensuring complete transparency. VIOOH is available in the UK and will shortly be launched in the US and in many other countries, providing an excellent opportunity for JCDecaux to take outdoor advertising into a new era and giving the outdoor advertising industry a differentiating edge in a digital world. Our aim is to create an open platform that can be accessed by other media owners. We also want to fulfil our role as market leader by addressing the challenges of programmatic advertising to take on the Internet giants.
In order to give this major revolution some substance, we have thoroughly adapted our business and created the conditions for our success at JCDecaux. A new Data Division was set up at Group level in 2018, with the task of harnessing the considerable potential offered by data collection, analysis, modelling and use (in strict compliance with the General Data Protection Regulation). This has enabled the launch of a whole raft of projects, some of which have been completed, in the fields of audience measurement, media impact and effectiveness, and also smart, context-based broadcasting of content on digital screens. Every day, the men and women working at JCDecaux support and anticipate these major developments and contribute to the Group's transformation. This has meant recruiting experts in the various data sectors, and also training and upskilling all staff to meet the new challenges brought by digitisation.
JCDecaux has entered a new era, while staying true to its fundamental values: a drive to innovate, commitment, operational excellence, and a permanent search for aesthetic quality. To continue shaping the future of outdoor advertising is an amazing prospect and we thank our employees and partners who are committed to joining us on this journey. The final destination is unknown, much to our delight.
© Gilles Dacquin
Chairman of the Executive Board
Co-Chief Executive Officer
Co-Chief Executive Officer