Share of UK adspend allocated for out of home (OOH) has remained steady over the last ten years – it is projected to outperform the ad market in 2017 by 1%, but underperform the market by 1% in 2018 (AA/WARC).
Currently OOH’s growth is being largely driven by digital, with some parties believing this has led to cannibalisation of the medium. But digital OOH alone is accelerating at a fast pace – we’ve seen £400m of investment in the last five years (Talon) and it’s expected to grow by 17% this year (AA/WARC).
We partnered with Mediatel to interview senior clients, agencies and specialists to look at the actions the industry needs to take to continue to grow the medium. The results show there are still key issues we need to address and educate the industry on, to fulfill DOOH’s potential.
The buying and selling process
Let’s start with how we buy and sell the medium to clients.
We looked at how Australia positions the medium and they’ve managed to avoid the cannibalisation of traditional OOH by selling DOOH separately. Whilst we might not be in a position to change this in the industry at the moment, there are steps we can take to improve the buying process through automation.
Whilst it was encouraging to see that 57% of respondents said that the flexibility offered by DOOH is successfully taking money from press, or online, for short-term media budgets, this must be levelled against market data which shows that OOH has failed to significantly capitalise on the press sector’s decline of over £850m of revenue over 5 years, with OOH share remaining at a similar level over the same time period.
The research highlights that OOH needs to work on any development that makes buying easier and saves time, including automated buying.
One media agency director observed: “The process for receiving short-term availability and deals is often convoluted which hinders the sector’s strike rate.”
Our research showed that 78% of respondents said that the ability to buy both Classic and DOOH through an online platform would be desirable.
It is the automation, ease and efficiency of the buying process that is thought to increase revenue to the medium.
Essentially, immediacy is paramount if OOH is going to successfully take money that is booked in the week for the week.
Educating the creative agencies
Our research shows that creative agencies don’t know enough about the opportunities available in DOOH, and as a result are not considering the medium early enough to exploit them. As one chief strategy officer commented: “creative agencies don’t know enough about media channels.”
There is an opportunity here for us to target the creative agencies – with media owners and specialists playing an instrumental part in educating them on the benefits of DOOH, how to use it creatively and how it is an immediate medium that doesn’t require a long lead time.
Moving away from price to value
There is a good degree of positivity, from agencies, towards increasing investment in DOOH but the restrictive factors are seen as limited coverage and high production costs.
One head of media commented: “There is the capability for DOOH to be flexible and take money from other media but to create the appropriate copy is costly and can be complicated.”
The production cost of DOOH in comparison to traditional OOH is higher, however the conversation needs to move away from price and instead to its value. The flexibility, premium feel, greater immediacy and agility of DOOH is a large draw for advertisers and has also been cited as a reason for new brands using the medium.
We, along with the industry, have invested in extensive research demonstrating the additional value that digital OOH delivers when bought with a traditional campaign. Let’s work together to turn the focus away from pricing and more on value for clients.
Improvement in measurement
Part of convincing more advertisers to invest in OOH involves improving our measurement and use of data. 87% of respondents think that the increase in usage of data will increase investment into DOOH and we know the ability to demonstrate effectiveness is paramount to the industry.
A marketing director we interviewed said: “Not sure that data is currently being used to its full potential. Both contextual and dynamic have untapped potential.” Route is a positive step, but the lack of a single industry-wide reporting platform somewhat undermines confidence in the medium.
The usage of data is an avenue of potential growth in DOOH expenditure and a step towards better measurement – if used correctly, more data can only be a good thing. Collectively we must prove effectiveness, digital verification and ROI.
Take a stand on proving trust
It’s vital that we reassure clients that DOOH is a trusted platform in comparison to other digital players. We’ve seen huge uncertainty in digital advertising this year with advertisers expressing concern regarding trust and brand safety.
It is our role as media owners to work with our competitors and partners to push for automation and make digital OOH more accessible for brands”
Our research shows that when it comes to trust and confidence in each medium, traditional media scored highest; however, OOH garnered the least confidence out of the traditional media (TV, press, cinema and radio ranking higher).
Whilst OOH is higher than online and mobile for trust and confidence, we need to improve our ranking against other traditional mediums.
OOH benefits from not having accompanying editorial, no ad-blockers and no geographic sensitivities. We need to stand together as an industry to reassure clients of the brand safety DOOH offers.
As you can see, our research has found that most of the issues raised are centred around education and ease of buying – meaning they are solvable. Overall revenue growth sits with the education of the client and the media agency to the potential capabilities of DOOH – whether that is on trust, measurement or value.
It is our role as media owners to work with our competitors and partners to push for automation and thereby make digital OOH more accessible for brands as we look to increase the coverage of DOOH across the whole of the UK.
There is a real opportunity here for the industry to collaborate to sell the dual benefits of DOOH and classic OOH and drive increased share into the medium in 2017.