By David Ward
Despite pandemic-induced lockdowns and precipitous declines in both automotive and pedestrian traffic throughout 2020, digital out-of-home (DOOH) advertising spending held its own last year, growing slightly less than 2 percent, according to eMarketer. What's more, DOOH will increase 19.2 percent this year, when vaccines are expected to be widely distributed and consumers get back into the swing of things.
"Digital inventory and digital expansion are really becoming the core of our business," says Bob McCuin, EVP and chief revenue officer at Clear Channel Outdoor Americas. "It [now] represents in the single digits in terms of overall inventory, but it's about a third of our overall revenue in the U.S."
The boost is being driven in part by brands that are relatively new to out-of-home advertising and are intrigued by the ability that DOOH gives them to develop, distribute, and measure outdoor advertising in ways that mirror digital, social, and mobile media channels. As the market evolves, brands are increasingly looking to emulate the success that tech giants have garnered with outdoor ad campaigns.
Last year, for example, Twitter leveraged both digital and traditional billboards in locations ranging from Times Square to Hollywood to showcase tweets about life in 2020. (Twitter is a client of Clear Channel Outdoor America.)
"The role that out-of-home plays is to drive the conversation loop currently taking place on Twitter," says Dan Levi, EVP and CMO at Clear Channel Outdoor Americas, who adds that the popularity of these national footprint campaigns is helping the industry shake the misperception that OOH is only effective as a last-mile marketing channel. "If you're just looking at this as a way to target consumers when they're near you, you're really leaving business on the table."
Anna Bager, president and CEO of the Out of Home Advertising Association of America (OAAA), says that Facebook and Google, as well as national and regional DTC brands, have also embraced OOH.
Bager adds that marketers who successfully integrate DOOH into an omnichannel strategy find that it's a cost-effective way to reach consumers. "It can be very affordable in that you get so much more through social sharing if you do it right," she says. "It's also impossible to block, it's impossible to skip, there's very little froth, and messages can be switched out very quickly."
The biggest pushback from CMOs and ad agencies when it comes to DOOH is that it's hard to measure and difficult to buy.
"DOOH still has long ways to go in regard to measurement [and] analytics to compete with more robust digital channels," says Sargi Mann, EVP, head of digital strategy at Havas Media USA. "The lag in the digital ecosystem needed to truly take advantage of optimizing the last mile, compared to other channels, needs to be fast tracked by various OOH providers to continue to see growth."
DOOH companies are responding by augmenting existing measurement tools, such as post-purchase surveys, focus groups, geofencing, and QR codes, with new metrics that leverage location data from mobile providers and other opt-in sources.
Levi stresses that the metrics can be gathered without violating consumer privacy. "It's not individuals," Mann says. "We're talking about audience segments as out-of-home is always going to be a one-to-many medium. What we do is analyze aggregated anonymous location data, so we can understand where people go and what they do in the physical world."
Andrew Newman, CEO and co-founder of U.K.-based DOOH.com, adds that in European markets the relationship between out-of-home and mobile is an essential part of many advertising campaigns.
"Out-of-home has the ability to connect screens offering synchronicity of viewing and driving reach," he says, adding that the availability of data on sales and transactions, mobile behavior from browser and app usage, and location-based information about where consumers go when out of the home can now help marketers maximize the effectiveness of DOOH campaigns.
Connecting the Digital Tools
Along with enhanced metrics, the industry is moving to standardize DOOH ad formats. "There are now standards around the size of billboards and the different forms of out-of-home, including those with moving video and with or without sound," Bager says. "We still have some work to do in making sure it's more widespread and making sure it's all connected."
With metrics and formats in place, marketers can start buying DOOH programmatically, which will take some of the complexity out of the process.
"There is significantly more opportunity to offer more to marketers when it comes to programmatic OOH, including competitive separation, 100 percent ownership of all ad units available, and display to mobile formats," Mann says, adding that the various tools "bring connectivity from one message to another and build richer insights on the back end."
Levi adds the emergence of programmatic DOOH should convince marketers that OOH is not just a traditional ad buy. "Out-of-home comes to life with programmatic because you're able to buy our audience on the same omnichannel DSPs (demand-side platforms) that you're buying paid social, digital, mobile," he says.
The goal is to eventually provide brands with the ability to target not just geographically but also by specific audience segments. "A brand that wants to buy auto enthusiasts, [ages] 35 to 40 in the Chicago area who are male and wear red shoes, would be able to do that on Hulu, do that in the Chicago Tribune, and do that on billboards," Bager says. "That's what we want to get to, but we're not there yet."
The arrival of COVID-19 vaccines will spur additional opportunities in DOOH, as consumers return in droves to shopping in brick-and-mortar stores and eating inside restaurants after being stuck in their homes because of the pandemic.
"DOOH needs to elevate its offerings and contextualize its role in driving in-store visits," Mann says. "Even though digital commerce has accelerated and now constitutes about 30 percent of all commerce, that still means 70 percent or more shopping transactions continue in the physical world."
Bager, from the OAAA, says that with roughly 10,000 digital billboards and about 1.25 million digital screens in the U.S. — ranging from gyms to gas stations to theaters to airports — ad inventory is somewhat limited compared to what's available on digital platforms, social channels, or mobile.
At the same time, while there's a lot of upside, marketers need to take the time to understand how to buy DOOH and measure its effectiveness.
"Think about it as a huge-reach media that can have a massive impact because consumers like seeing and engaging with DOOH billboards," Bager says. "Make it part of an overall plan, learn about it, and don't go into it thinking, 'Oh it's just so hard to buy and you can't measure it,' because that's not true anymore."