• by Larry Dobrow , November 28, 2005

For years, advertisers in urban markets have been teased with the promise of the high-tech taxi cab. In the 1990s, pundits predicted a raft of in-cab ad opportunities for marketers hoping to inform, divert, and even entertain passengers. But when it came to getting backseat screens up and running, few would-be suppliers were able to navigate through the morass of taxi commissions, fleet owners, and technology gurus.

"Ground [transportation] has always been the ignored stepchild from a technology standpoint," shrugs David Popeck, executive vice president of the New York-based Corporate Transportation Group.

There are signs that this is about to change. Interactive Taxi, a five-year-old startup, has made inroads into a handful of major markets, including Boston, Chicago, and San Francisco. In nearly 700 cabs in those cities, the company has installed what ceo Corey Gottlieb describes as "fully interactive computers" connected wirelessly to the Internet. The screens run a mix of ad-supported news, business, sports, and weather content.

Gottlieb says the Interactive Taxi model has one key advantage over previous strategies: Viewers can get more information on the ad content simply by touching the screen. For example, the campaign for Discovery Networks' "Greatest American," which ran in cabs this summer, featured an ad encouraging passengers to tune in; they could touch the screen for more information. "What we're offering is the power of the 30-second television commercial with the immediacy and depth of the Internet," Gottlieb says.

The stakes are about to get higher. In March 2004, New York City's Taxi and Limousine Commission mandated that each of its more than 13,000 cabs install information screens and credit/debit card readers for passengers, as well as global positioning satellite (GPS) technology and two-way text messaging for drivers. The cost: between $1,000 and $2,000 per cab. Advertising will partly defray the expense.

Interactive tv is one of the finalists for the nyc contract, which will be awarded early in 2006. "That might change the game dramatically for whomever gets the nod," Gottlieb says. He estimates that around one million people ride in New York cabs each day, compared with 600,000 viewers for the top local evening newscast. "You take the upscale demo of the taxi audience and add to it massive reach, and what you get is an amazing new media opportunity."

Critics, however, question whether taxi cab marketing will ever have the impact its boosters predict. "The taxi is sort of a sanctum," says Drew Livingston, president of Free Car Media. "At first, passengers will be amused by [the screens], but the novelty will quickly wear off." Livingston also questions whether companies like Interactive Taxi will be able to provide metrics that advertisers demand, including the ability to link sales data directly to passengers who saw in-cab ads.

Gottlieb counters by noting that travelers can easily turn off the ads if they want peace and quiet, although he claims that only 3 percent of passengers in Interactive's cabs have availed themselves of this option. He also says his company offers marketers data on ad frequency and the number of passengers touching the screens for more information. "You get isolated negative responses, like with anything, but the advertisers seem very satisfied with the audience we're delivering and the customers seem to be engaged with the product," he says.

Larry Dobrow is a regular contributor to MEDIA magazine. This story is re-published from the November issue.