Last week Watchfire announced a five-year brightness guarantee, uniformity guarantee, parts and labor guarantee and a money back guarantee relating to its new MV Class digital billboards. Insider interviewed Darrin Friskney, Watchfire’s VP of Digital Outdoor and Marketing about the announcement.
Darrin, how are Watchfire’s MV class digital billboards different from the other billboards in Watchfire’s product line?
The idea behind an MV Class billboard is that it will look as good after five years of operation as it did on day one. As we did with our MX Class last year, we are combining our cutting-edge technological advancements with our commitment to service to see to it that the billboard’s brightness and color uniformity will stay as vibrant and smooth as they were the day it was installed for five years – ten with the MX Class.
Is the five year guarantee as inclusive as it sounds?
Yes. Billboard operators are busy selling ads and growing their business. Our goal here is not to introduce stress or trickery, but rather to provide a straight-forward and predictable performance with a product that will be like new for at least 5 years. The guarantee does just that. And we put our money where our mouth is with the money back guarantee.
What can an outdoor advertising company expect concerning the useful life of a Watchfire MV Class billboard?
We have many billboards in the field approaching 10 years of age now, and the MV Class and MX Class products available today far surpass the technology of those 2007-era boards. Our history as a company and a manufacturer of digital billboards, along with the guarantee, speaks to useful life. If the billboard doesn’t show signs of age for the first five years of life, it’s got a better start in terms of longevity than other billboards. We would expect an MV Class billboard to still be returning ROI long past the guarantee period.
As a side note, the Watchfire billboards that are approaching ten years of service started at only 5,000 nits and weren’t even color calibrated — which is standard on high-quality displays today. What we are doing now is so much better than what were were doing ten years ago. If our customers are going to get ten plus years out of those 2007-era boards, who knows how long these new boards will last?
At some point even the best digital billboard will need to be replaced. What’s your advice to outdoor advertising companies on sign replacement costs. What sort of sinking fund should an outdoor advertising company be budgeting for maintenance or the eventual replacement of a sign?
A lot of factors can influence that, including whether the purchase is financed and what those terms are. We see customers hitting positive ROI in year 1, year 2, making the value of the asset much higher than the original cost. We’ve also seen component prices fall over the last 10 years as well, making replacements more affordable than their predecessors. If I were in the industry I’d want to make sure I had a plan for eventual replacement, and I’d work with my accountant to ensure my depreciation and sinking fund strategy would allow me to do that. As with many things about running a business, it’s never going to be a one size fits all formula. We introduced the MV Class (5 year guarantee) and MX Class (10 year guarantee) to provide a fixed period of time where the product will deliver as new. Your accountant can help you decide if those fixed periods match up with a depreciation or fixed asset sinking fund strategy that is right for your business.
One thing we do know is that replacement costs don’t drive revenue — they only replace revenue. Our savvy customers have commented that every additional year of operation that they can get — and every year they can hold off replacement costs — allows them to leverage the financial performance of their company. That’s why these guaranteed products have been so powerful.
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