CAR2AD | Overview

When a new shop opens in Berlin, the business owner usually gets into contact with an advertising agency for campaigns in order to win over new customers. Together with the agency the store owners then decide, for example, to run advertisements directed at the store's target group (e.g. male customers between the ages of 18 - 36 in the Berlin district of Kreuzberg) via billboards and other outdoor advertising mediums.

A single digital advertising surface in Berlin can cost multiple hundreds of euro per day depending on the location; this is due to the fact that many thousands of people pass the billboard each day.  However, there are very few potential customers among this group of people.  In the end, the business pays a lot of money to run advertisements for individuals that aren't considered part of the target group.

For the many companies that exclusively advertise online, this sort of inaccuracy is practically unimaginable. And that's why we developed CAR2AD, the first product that makes target-group specific advertising possible for the outdoor sector. Similar to the likes of Google and Facebook, the advertising invoice is then drafted according to the amount of customers the billboard reached.

This is already possible in Asian countries, like Singapore. We at CAR2AD are the first in Germany to bring this sort of advertising "to the street". Together with our partners, drive by and you, the Companists, we want to finally digitize outdoor advertising in Germany.

From global players, like Samsung, to the baker around the corner, CAR2AD offers a new form of advertising for many different business customers. Through our high-resolution mobile LCD screens, which are connected to the internet 24/7 through cutting-edge mobile technology (LTE), our customers are able to run current advertisements at any time, precisely where they want to thanks to GPS.

This allows new customers to be gained while at the same time also ensuring that existing customers are kept. This method is much more effective and affordable and can be implemented on shorter notice in comparison to traditional print advertising options, which generally require lots of preparation.

What makes CAR2AD's method of outdoor advertising especially unique is its ability to track the success of advertisements; here the number of views is displayed in the invoice. As is typically the case, these advertisements feature large ranges and are now also target group specific.

With CAR2AD, digital outdoor advertising is at a large advantage when it comes to events. This is due to the fact that a large variety of up-to-date advertising messages can be immediately displayed.

CAR2AD currently offers two different product varieties that are tailored to different customer needs. 

Target group: Traditional outdoor advertisers or agencies from the event marketing industry

With the "Event" product, CAR2AD drives vehicles with attached displays directly to event locations where advertisers can then project their messages to specific target groups. Here, we use regular rental cars or book carsharing vehicles from our partners and install our screens on the roof of the car for the corresponding time period of the rental.

Target group: Online marketing agencies

Through its automated booking process, the product, "Fleet", enables advertising content to be displayed according to target groups and the time of day and frees advertisers of planning expenses.  Carsharing vehicles equipped with CAR2AD screens are driven through the city by carsharing customers instead of by our own employees. While the cars are parked and the carsharing provider isn't able to gain any revenue, CAR2AD displays information and advertising material.

With the quick and flexible use of the advertising surfaces, we make it possible for local customer groups with small budgets to gain attention and win over customers in the short term (e.g. a bakery or another retailer in the inner city of Munich).

The business model of CAR2AD is based on three pillars.

• Event product – (direct customers) for early market entry.
• Fleet product – (media agencies) limited personnel effort
• Research contracts – analyses of new trends

Pillar 1: Event product

Through partnerships with carsharing companies, CAR2AD operates mobile advertising space on car roofs. A portion of the proceeds from the income gained by using the car roofs is passed on to the carsharing companies. The "Event" product is sold to local customers with the help of sales partners, like "Der Tagesspiegel".

Pillar 2: Fleet product

By connecting to established systems from the online marketing world, our technology makes it possible to book outdoor advertising with the click of a button and prove the success of the advertisement by measuring the size of the reached target group. Through this form of advertising, advertising space can be sold to media agencies and highly desired advertising spaces can also be auctioned.

Pillar 3: Research laboratory

Through the tight contact to the Federal Ministry for Transport and Digital Infrastructure (BMV) and the tight network within the mobility and digital economy, we analyze new trends in the course of funded research projects. Through research projects, like that of the current "Smarttop", we generate business-relevant knowledge for the continued development of the product and exploitation of new markets.

CAR2AD is the digital outdoor advertising provider that places ads where the customer needs them. Through LCD displays on car roofs, the public and therefore a large reach in general is addressed. What's more, target groups are spoken to in a way that, until now, was only possible with smartphones (i.e. with real time data). This puts CAR2AD in an extremely attractive market segment.

1. More effective than billboard advertising

The real-time measurement of billboard viewers is carried out through a statistical and anonymous evaluation of Wi-Fi signals. These are regularly sent from every telephone even when there is no active Wi-Fi connection. This allows CAR2AD to display the reached target group on the invoice. This makes selling ads for advertising agencies even more valuable, as it's been very difficult to prove the effectiveness of traditional outdoor advertising until now. At the moment, our technology's precision is over 90% in comparison to manually counted billboard viewers.

2. More affordable than billboard advertising

For billboard advertisements, there are still many established manual processes. This refers to the submission of bids, the booking process, and the invoice. With CAR2AD's scalable fleet product, all of this is completely automated. The booking process takes place through established online marketing systems: The prices are automatically negotiated, the content is transferred through the Cloud Server, the advertising is displayed when the target group is present, and the invoice is immediately available for the customer. By using the roofs of the vehicles as advertising space, the entire city is available for advertising clients.

3. New advertising formats

Advertising on CAR2AD boards is displayed while the vehicles are parked. The vehicles of carsharing providers are primarily parked at marketing hotspots. By using a Wi-Fi hotspot that can be logged into by smartphone users with one click, interactive advertising content also becomes possible. The more unconventional and new the appeal is, the more effective the advertisement is.

Our clients are traditional outdoor advertising outlets, the event sector, and the online marketing sector. Cooperating with large media agencies from the online marketing sector offers direct access to global brands with high media budgets.

Business partners - existing partnerships:

Sales:

• Tagesspiegel - high circulation daily newspaper and the largest in the Berlin area: Sales of the "Event" product
• Publicis Groupe – the fourth largest advertising agency worldwide. As our first contractor, Publicis wants to implement a large-scale campaign with CAR2AD as soon as we're able to offer the completed infrastructure.

Technology:

• Splicky– Booking platform (demand side platform – DSP) for marketing agencies: Complete integration of our software solution
• Adform – offer platform for advertising space (supply side platform – SSP): Access to additional global DSPs
• Beacon inside – Campaign and analysis platform for Beacon networks: Beacon networks make it possible to run customer flow analyses in buildings via smartphones. Outside of buildings, perspective customers can be addressed according to their positioning via previously installed apps.

Fleet:

• Drive by – Carsharing partners in Berlin
  • Currently have 25 vehicles: 20 Audi A1 and 5 Fiat 500, build up to 200 -400 vehicles by 2019.
  • Partnership agreement and running test operations
  • Kilometer-based invoicing and the first calculable prices for carsharing.

• Clevershuttle –Ride sharing provider from Berlin.
  • Ridesharing is a new form of group taxis that can be booked via an app.
  • At the moment, there are 32 vehicles in Berlin, Leipzig, and Munich.
  • Letter of intent (basic agreement) for the cooperation.
  • Joint research project granted through the BMVI.

Target groups

Our customers and our target groups are business customers (B2B)–these are generally from the overlap of out-of-home advertising and online marketing. Both markets are interested in advertising on displays in public spaces (Digital out of home [DOOH]). This market grew by 46% from 2016 to 2017 and was worth €295 million in 2016. 

Target group I

Direct customers as well as marketing and event agencies.

This target group is looking for an effective alternative to traditional advertisements, like billboards or magazine ads. Event agencies think CAR2AD is exciting, as our concept will enable them to offer more attractive and therefore more profitable advertising possibilities while on site. In order to reach direct customers, we've finalized a partnership with the Berlin-based newspaper, "Der Tagesspiegel".

Target group II

Media agencies

Global media agencies are very interested in new advertising possibilities, as this allows them to invest the advertising budgets of large brands, like Samsung, more precisely into marketing efforts.  With a fleet of 15-20 boards in Berlin, the advertising reach is already high enough in order to implement the first advertising bookings with large customers.

Market volume

In 2016, €6.6 billion  was spent on online marketing in Germany. For out-of-house advertising during the same year the sum was €1.7 billion. During the same year, the market for digital out-of-home advertising grew by a good 46 % to €295 million and was driven first and foremost by established companies, like Ströer and WallDecaux. The online marketing sector is especially interested in getting access to these digital surfaces.

Since its foundation in December 2016, CAR2AD has put a lot of work into developing a reliable and strong partner network. From cooperation partners in the area of carsharing, to technology providers from the online marketing area and the customer side, we're all set and will be able to enter the market this year.

At the moment, we're in the test phase with our first contractors. Starting with a fleet of 15 -20 boards in the city, agencies will be able to offer their customers (e.g. Samsung, Post, etc.) our advertising space. According to our current projections, we'll be able to provide these numbers by the end of 2017 At the same time, we've also initiated a partnership with the "Tagesspiegel" in order display advertisements for regional customers at events.

The first five vehicles from the carsharing provider, Drive by, are being equipped with the CAR2AD boards and ads are being sold to regional customers through our sales partner, "Der Tagesspiegel".  The technical interfaces and the connection to existing processes for online marketing can already be used.

The preparations will be taking place in the summer of 2017 in order to outsource hardware production (CAR2AD boards) to external service providers in Germany. By Q4 2017, all technical and hardware tests required for the live operation in Berlin will have been implemented.

By 2018-2019, the fleet should have 100 - 200 boards and the revenue will have increased accordingly. By 2020, we plan on expanding into additional German cities – to this end we're already in talks regarding this matter.

CAR2AD needs a follow-up round of financing in order to get our business model rolling.  In this early phase, we'll be able to gain revenue with direct customers from the area.

We look forward to your investment and also to giving you the chance to help push our development through advertising contracts. This way, we'll also be able to demonstrate our product's effectiveness. In Berlin, we can bring you and your message to almost every location and customize it precisely to your target group.

• December 2016: 1st place in the Federal Ministry of Transport and Digital Infrastructure's (BMVI) hackathon. Since then, we've been in ever-increasing contact with the Ministry. We were invited to the first BMVI start-up pitch day and were able to get into contact with relevant decision makers (Link to the video).

• In February 2017, we were awarded by the Accelerator, hardware.co, by Texas Instruments, and Audi. Texas Instruments also supported us on technical matters. Through the conversations and through the award, Audi showed us that our product also has potential for the future market of autonomous vehicles. 

from left to right

• Matthias Jürgensen: Business Development
• Florian Hackenberger: Software Development
• Valentin Jahn: Managing Director
• Christian Dinca: Hardware Development

CAR2AD (MDL Mobility Data Lab GmbH)
Gürtelstr. 26a
10247 Berlin

Phone: +49 30 120 86 7 85
Email: info@car2ad.de

Website: www.car2ad.de
Facebook: www.facebook.com/CAR2AD
Twitter: http://twitter.com/CAR_2_AD