Introduction to Out-of-Home Advertising

INTRODUCTION

Traditional forms of advertising media such as radio, TV, newspapers, and magazines usually reach their target audiences in their homes. But, how are audiences reached if they’re not at home? One possible answer to this question is in ‘out-of-home’ advertising. Out-of-home advertising includes those media forms that people see when they’re out of their home walking, driving, riding mass transit or in taxis, or riding their bicycles. This unit will introduce this growing segment of advertising.

Traditional

• Out of Home Advertising: By OAAA

• Categorized into: Billboards, Street Furniture,

Alternative Media, Transit and Radio (Specific).

• Billboards:

– Bulletins Spectacular Displays

– Wall Murals Vinyl Wrapped Posters

– 30 sheet posters 8 sheet posters

Traditional

• Outdoor: Since 5000 years

• One of the more pervasive communication forms.

• Street Furniture:

– Bus Shelters Urban Furniture

– Kiosks Convenience Stores

– Shopping Malls

Non Traditional

• Branded Entertainment

Film, Music Talent, Technology

• Miscellaneous

Videogame ads Parking lot ads

Bathroom ads Place based media

Others (Wireless, Mobile)

Out-of-home advertising

• Out-of-home advertising (or outdoor advertising) is made up of more than 100 different formats, totaling $6.99 billion in annual revenues in 2008 in the USA. Outdoor advertising is essentially any type of advertising that reaches the consumer while he or she is outside the home. This medium is in contrast with broadcast, print, and Internet advertising.

• Out of home advertising, therefore, is focused on marketing to consumers when they are "on the go" in public places, in transit, waiting (such as in a medical office), and/or in specific commercial locations (such as in a retail venue). Outdoor advertising formats fall into four main categories: billboards, street furniture, transit, and alternative

Overview• Billboard advertising is a traditional out of home

advertising format, but there has been significant growth in digital out of home advertising (billboards and place-based networks) in recent years; for example, about 1,500 digital billboard displays have been installed in the United States alone.

• Traditional roadside billboards remain the predominant form of outdoor advertising in the US with 66 percent of total annual revenue. Today, billboard revenue is 73 percent local ads, 18 percent national ads, and 9 percent public service ads

Conti…Street furniture is made up of formats such as bus

shelters, news racks, mall kiosks, and telephone booth advertising. This form of outdoor advertising is mainly seen in urban centers. Additionally, this form of advertising provides benefits to communities, as street furniture companies are often responsible for building and maintaining the shelters people use while waiting for the bus.

Transit advertising is typically advertising placed on anything which moves, such as buses, subway advertising, trackside, and taxis, but also includes fixed static and electronic advertising at train and bus stations and platforms. Airport advertising, which helps businesses address an audience while traveling, is also included in this category. Municipalities often accept this form of advertising, as it provides revenue to city and port authorities.

Conti…Finally, alternative advertising includes ads in

stadiums, on gas pumps, bike racks, rest areas, and other non-traditional formats. Alternative advertising provides a way to address consumers in places they may not expect.

Street furniture, transit, and alternative media formats comprise 34 percent of total outdoor revenue in the US. Some of these formats have a higher percentage of national ads than traditional billboards.

The outdoor industry includes more than 2,100 operators in 50 states representing the four major outdoor format categories. These outdoor media companies range from public, multinational media corporations to small, independent, family-owned businesses

Outdoor Outlook: Some hopeThe year 2012 is expected to be more

of a year of recovery for the Outdoor medium. As per Pitch Madison Media Advertising Outlook 2012, Outdoor is expected to grow by five per cent to Rs. 1,362 crore in 2012. The share of the medium in the total ad-pie is expected to fall to 4.9 per cent than the 2011 level of 5.1 per cent.

Conti..Some feel that 2012 will either be too

good or too bad. One worrisome factor is the likely regulation by external authorities. “The industry has to be careful and safeguard its interest. Self-regulation by the industry body and also representing itself strongly to the government authorities has to be done. It should not be the other way round,” says Abhijit Sengupta, CEO, Outdoor Advertising Professionals (OAP).

Conti..While urban markets will still lead spends, Tier II & III

markets will also drive higher revenues commensurate with consumption. Going forward, the biggest challenge for the Outdoor industry will be twofold: to increase the spending from the existing categories and to bring new categories on board. FMCG, Retail, Media and BFSI are expected to increase their spends in 2012.

Ishan Raina, CEO & MD, OOH Media, says, “The industry is still budding and there is immense scope for new clients, categories and growth. Every category can get its share of audience it is looking for.” Raina also feels that the biggest challenge will be in growing the clients’ categories like the IPO category, and healthcare.

Conti..Experts are of the view that one thing that

can make a big change in the industry and help brands trust Outdoor more, is a strong measurement matrix. There is a firm trend amongst large spenders to seek quantifiable justification for ad spends – and spends in OOH are increasingly on the radar. The IOAA is also engaging with clients to understand their expectations and look at bridging the gap. There is also the issue of benchmarking costs for sites within a cluster – currently there is no logic and clients find it difficult to accept huge variations in cost.

Conti..Rural OOH can bring some good news too. Sunder

Hemrajani, MD, Times OOH, says, “It is expected that there will be increased share of OOH in rural advertising on the back of integrated advertising cum activation by key categories like FMCG and telecom, and rapid consumption shifts from the top six metros to other Tier II & III cities.”

Another challenge for OOH players will be on adopting technology-led innovations and execution on a larger scale than one or two isolated executions, which has largely been the case till now. Younger audiences and easily affordable smart gadgets are changing expectations and perceptions rapidly. If OOH has to engage, rather than be only seen, then there is no option but to adopt of technology

Conti..• If the industry is able to harness the key growth

drivers and formalise self regulation / Standard Operating Procedures for itself, there is no doubt that it can increase its share in the ad pie. The larger share of the pie would come from both – an increase in the overall media capitalisation, as well as marginal shift from ATL media. Understanding the potential of new technology and using it correctly will also spur advertisers to invest more in OOH.

• Also, the performance of the medium will depend a lot on how quickly and effectively IOAA is able to implement its plans.

Digital Out Of Home - DOOH

Digital out-of-home refers to dynamic media distributed across placed-based networks in venues including, but not limited to: cafes, bars, restaurants, health clubs, colleges, arenas, gas stations, and public spaces. DOOH networks typically feature independently addressable screens, kiosks, jukeboxes and/or jumbotrons. DOOH media benefits location owners and advertisers alike in being able to engage customers and/or audiences and extend the reach and effectiveness of marketing messages. It is also referred to as Digital Signage

Conti…• The overall industry grew more than 15 percent last

year(2010) to $2.1 billion, according to Patrick Quinn, CEO and founder of PQ Media, a Connecticut-based research and consulting firm. Quinn said gas station television is one of the largest and fastest growing segments of that category, based in part on its verifiable audience. With digital TVs in gas stations, nearly 52 million customers are getting snippets of weather, sports highlights, celebrity gossip and commercials with their gas each month, according to Nielsen. The weekly reach is actually larger than most of the prime-time TV shows. The largest company in the space is Gas Station TV with 27.5 million monthly viewers at more than 1,100 stations across the U.S.

Conti…• according to Nielsen.  In addition to the large

number of viewers, the audience profile of TVs at gas stations is unique. 100 percent are drivers. 76 percent are adults from age 18-49 with a median age of 40 and Median HHI $70k+. According to the Nielsen Intercept Studies, 89 percent of the consumers are engaged and watching TV at the gas station and 88 percent love watching every time they fuel because they have nothing else to do.

• The reason that this category is growing so rapidly is because busy people are typically busy at home and with the introduction and acceptance of digital video recorders, it has diluted the frequency with which traditional television commercials are viewed.

Conti…• Every day more TV viewers are skipping past

commercials with their DVRs which in turn has made out-of-home advertising all the more appealing. A Nielsen media research study in 2009 showed that 91 percent of DVR owners skipped commercials. As a result, traditional TV advertisers are hungry for an effective substitute, and digital out-of-home ads appear to be one of the solutions.

• DOOH also includes stand-alone screens, kiosks, and interactive media found in public places. The availability of inexpensive LCD screens with built-in media players has opened the door for companies to add interactive video messages in Point of Purchase (POP) Displays. The displays allow consumers to get additional information at the moment of decision on a product or service. Growth in the DOOH industry has been increasing in 2009, with more POP manufacturers, advertisers, and content developers moving to digital

Outdoor Advertising Advantages

When people think of Outdoor Advertising, they usually think of the colourful billboards along our streets and highways. Included in the "outdoor" classification, however, are benches, posters, signs and transit advertising (the advertising on buses, subways, taxicabs and trains). They are all share similar advertising rules and methods.

Outdoor advertising reaches its audience as an element of the environment. Unlike newspaper, radio or TV, it doesn't have to be invited into the home. And it doesn't provide entertainment to sustain its audience.

Some Outdoor Advantages:

Since it is in the public domain, Outdoor Advertising assuredly reaches its audience. People can't "switch it off" or "throw it out." People are exposed to it whether they like it or not. In this sense, outdoor advertising truly has a "captured audience."

It's messages work on the advertising principle of "frequency." Since most messages stay in the same place for a period of a month or more, people who drive by or walk past see the same message a number of times.

Particular locations can be acquired for certain purposes. A billboard located a block in front of your business can direct people to your showroom. Or you can reach rural areas efficiently by placing a billboard in each small town.

Outdoor advertising is an excellent adjunct to other types of advertising you are doing. In fact, it is most effective when coupled with other media.

Some Outdoor Disadvantages

Outdoor advertising is a glance medium. At best, it only draws 2-3 seconds of a reader's time.

Messages must be brief to fit in that 2-3 second time frame. Ninety-five percent of the time, either the message or the audience is in motion.

The nature of the way you have to buy outdoor advertising (usually a three month commitment) is not conducive to a very short, week-long campaign.

Conti..• When you buy outdoor advertising,

remember that location is everything. High traffic areas are ideal. A billboard in an undesirable area will do you little good. Keep your message concise (use only five to seven words) and make it creatively appealing to attract readership. Few words, large illustrations (or photos), bold colors and simple backgrounds will create the most effective outdoor advertising messages.

What does out-of-home advertising look like?

Out-of-home advertising is extremely varied in the forms that it takes. It includes everything from traditional billboards and transit advertising, through to sports/arena advertising and in-store POP (point-of-purchase) advertising. The following sections will outline a number of different types of out-of-home advertising.

ThanQ………..

Laxmikanth S JamadarB.Com, MBA