2. Increased hyper-targeted reach and profitability
In the past, OOH relied on advertising to a broad audience as a means to get their message out to specific demographics. Over time, this ‘fishing’ approach proved to be inefficient and ultimately limited campaign reach. In 2020, with growingly accessibility in data-led planning, more advertisers were able to realize real and measurable outcomes through targeted campaigns.
Increasingly, OOH advertisements—especially digital—can be equipped with beacon technology. By analyzing data from movement patterns to purchasing history, advertisers can tailor their ads according to specific audience profiles across varied locations. As a result, the chances of an outdoor ad getting noticed by targeted audiences significantly increases. Additionally, targeted campaigns not only increase campaign return on investment (ROI), but also reduce media spend wastage.
For example, Adshel, an outdoor beacon advertising company belonging to Clear Channel Outdoor, was an early adopter of this technology. Since its launch, Adshel has integrated more than 3000 beacons across its OOH advertising network—allowing brands to deliver geo-targeted and contextually relevant messages to consumers.
3. Growing ubiquity and profitability of DOOH
Digital media is nothing new to the OOH industry. Nowadays, one can visit their nearby urban centre to notice digital signage. However, because it is a costly proposition to replace thousands of OOH inventory with digitized versions, digital out-of-home (DOOH) had yet to completely dominate the market until recent years. For instance, despite being the main driver of growth in OOH advertising worldwide in 2019, DOOH only accounted for 28.3 per cent of all OOH ads that year.
According to the International Market Analysis Research and Consulting (IMARC) Group, global DOOH is expected to grow at a compound annual growth rate (CAGR) of 10.8 per cent in the next five years. This is largely due to the fact that, as more of the world’s population migrates to live in urban areas, the battle for ad space in these crowded cities will become more intense. At the same time, new studies indicate DOOH delivers ‘strongly’ against its premium price point.
According to a study conducted by Talon and Benchmarketing of 112 brands over five years, OOH campaigns that integrated DOOH generated an incremental return of approximately C$0.46 for every C$1 spent. This means, if a campaign increased its digital share of OOH budget from 60 to 70 per cent, the advertiser would expect a 22 per cent increase in profit.
In the coming years, it looks like advertisers can be much braver when it comes to using high-impact digital media as a part of their OOH campaign.
4. Further development of programmatic DOOH
Programmatic DOOH refers to the automated buying, selling, and delivery of OOH ads. Programmatic first made its debut in DOOH in 2018 when John Lewis & Partners launched a campaign for home improvement service Home Solutions. After failing to meet expectations throughout 2019, the much anticipated technology finally made its mark in 2020.
For the first time, advertisers could bid for an audience on the marketplace in real-time and get their message across to consumers at the right time and place.
Leading the programmatic wave were some of OOH’s biggest players, including JCDecaux, Kinetic, and Posterscope. Partnering with Adsquare, a mobile-first data exchange, the OOH giants were able to leverage major data management platforms (DMPs) and optimize digital ads according to audience insights.
For example, they provided in-depth data on demographics, consumer behaviour, weather, and time of day so a local restaurant chain could rotate its different morning, afternoon, or evening display menu options.
Further, in one study, 63 per cent of media planners said they would be more likely to recommend DOOH when it is available to buy programmatically.
As digital ad inventory continues to expand for the industry, media buyers will want and need to harness the power of the superior technology of programmatic DOOH.