Print experienced a whopping 10% fall to £1.1bn in UK ad spend in 2016. Direct mail also struggled, with an even steeper 10.4% fall to £1.71bn. TV, meanwhile, saw flat 0.2% growth to £5.27bn, which is forecast to turn into a 0.5% decline by the end of 2017, according to the AA/Warc’s annual Expenditure Report. Compare this to the 13.4% rise in internet ad revenues (£10.3bn) and the 45.4% increase in mobile ad spend (£3.86bn) for 2016, and there’s clearly a stark difference.
However, it isn’t all doom and gloom for the so-called traditional advertising channels. Last year, out-of-home grew total ad revenues by 4.5% to £1.1bn. And although this is predicted to slow over the coming years (2017: 3.4%, 2018: 2.3%), outdoor is backed to remain in positive territory while other traditional channels are expected to fall into even deeper decline.
Once treated as an opportunity to put a giant Big Mac poster on a motorway, out-of-home is increasingly being used by marketers for interactive storytelling and hyper-targeting. According to Cadi Jones, commercial innovation director at Clear Channel, the whole industry has evolved.
“Out-of-home is no longer just static billboards by the side of the road – the business model of the whole industry has fundamentally changed,” she says.
“Over the last few years, out-of-home advertising has undergone an exciting transformation through huge investment in digital technology. Digital out-of-home now enables advertisers to be more creative than ever, as the screens can now deliver intelligent, real-time and contextually relevant content to consumers – all in a fraction of the time it once took. This has reignited excitement among brands.”
The impact of programmatic
The rise of programmatic is also helping out-of-home to become more targeted. Through its Digital Audio Exchange (DAX) platform, Global, owner of radio stations including Capital and Heart, recently worked with energy brand E.ON to set up geo-fencing around out-of-home sites.
The technology enabled E.ON to identify when someone walked into one of the geo-fenced zones so when they later listened to digital radio or streamed music via their mobile device they were served an E.ON audio ad that mirrored the outdoor poster they’d already seen.
Adding the digital audio element to the out-of-home campaign increased consideration for the brand by 26%, while people exposed to both the outdoor activity and audio ads were 31% more likely to recommend E.ON. These same people were also four times more likely to sign up for a smart meter – the main objective of the activity – when visiting the energy firm’s website compared to average site traffic.
Out-of-home and mobile video ads are converging; there’s barely any differences.
David McEvoy, JCDecaux
In January, Clear Channel launched what it claimed was an “industry-first” programmatic offering for the out-of-home ad industry. And with 50% of all online spend now made via programmatic channels in the UK, Jones says it saw an opportunity to apply the same approach to outdoor.
Initially launched in Belgium before being rolled out to the UK in April, Clear Channel’s programmatic solution is already used by O2, Mercedes Benz and Deliveroo.
“Programmatic isn’t purely about the automation of our processes – it’s about connecting brands more effectively with their audiences by allowing them to deliver the right message to the right audience at the right time,” says Jones. He believes programmatic will be a “game changer” when it comes to ensuring out-of-home remains the jewel in the crown of traditional advertising channels.
“Ultimately, programmatic can revolutionise out-of-home – making it as flexible, measurable and creative as other media. It brings down buying barriers, making out-of-home even easier to buy. This will bring new spend to out-of-home from ‘digital’ budgets and programmatic buyers, helping to grow out-of-home’s share of the media spend,” she claims.
Outdoor has also benefited from its similarities to mobile video ads, according to David McEvoy, director of marketing at JCDecaux. This is the reason, he says, the likes of Google and Facebook are now among the biggest spenders in out-of-home. “Their digital platforms are built on smart, short form, autoplay video ads where sound isn’t initiated and that’s exactly what digital out-of-home is now offering at large scale,” he explains.
“In the UK, digital out-of-home now makes up 40% of the market. That will tip over to 50% by the end of 2017. Therefore, out-of-home and mobile will continue to converge; there’s barely any differences and the Facebooks of this world are realising this.”
More sophisticated storytelling
Two years ago, Women’s Aid debuted an interactive billboard in Canary Wharf, which featured the image of a bruised woman’s face with the tagline ‘Look at Me’.
It used facial recognition technology so that the more people viewed the image, the quicker the lady’s bruises would heal. The campaign promoted how domestic abuse can only be confronted if members of the public stop turning a blind-eye to its victims. The campaign, created by WCRS, is just one example of a deeper approach being used in out-of-home storytelling.
O2, for example, drove awareness and sales of its exclusive for the One Plus 3 handset by having agency CCP create ‘Coded’ – a campaign that targeted tech fans in three different locations. The interactive campaign worked by displaying coded messages that contained geographical coordinates. If a tech enthusiast cracked the code and got to the particular site in time, they’d win the handset.
Ian Cafferky, director of brand and marcomms at O2, says the #Coded campaign drove a 130% increase in footfall at the three targeted sites.
He says: “At its simplest, out-of-home is a great driver of fame and awareness on a national scale. But recent developments in out-of-home technology have allowed us to serve hyper-local and hyper-relevant advertising messages to the regional or local audiences. It allowed us to combine high impact creative and customer engagement.”
Much like Global’s campaign with E-ON, Deliveroo has targeted radio ads based on the out-of-home ads customers have been exposed to. And Deliveroo’s marketing director Jamie Swango believes hyper-local targeting is giving out-of-home an edge over other traditional advertising channels.
She explains: “Out-of-home advertising allows us to combine mass advertising with a hyper-local approach. However, Digital and dynamic out-of-home has allowed us to feature multiple new occasions that are displayed to consumers based on day of week, time of day, and weather, allowing us to increase the relevance of the advert.
“This ultimately supports our goal of increasing consideration of Deliveroo for new occasions in the summer, such as delivery of sushi to the park for lunch or delivery of beer to your Saturday barbecue with friends.”
Competing against digital
Deliveroo’s Swango says outdoor ads also allows the brand to be “smarter” than digital and social channels. She adds: “Out-of-home allows us to communicate a message – broadly, publicly – that is difficult to do in digital marketing alone. Many out-of-home formats have longer dwell times than digital, allowing us to be a bit smarter and more interesting in the ad creative to engage customers.”
According to Tim Lumb, insight and effectiveness director at out-of-home body Outsmart, high-profile scandals at Google and Facebook have boosted the industry.
With dozens of brands yet to return to YouTube after an investigation by The Times showed brand advertising was appearing next to extremist content as well as concerns around the accuracy of Facebook’s audience metrics, he argues this backdrop is playing right into the hands of out-of-home.
“The issue around online stats and brand safety has eroded trust. Advertisers want a medium they can trust and they are returning to out-of-home as it’s resilient. It is proven to work and properly verified,” he claims.
This is a sentiment echoed by 8 Outdoor, an out-of-home provider that, despite only launching 21 months ago, reaches 16% of the population and is opening up to 10 out-of-home screens per month.
OOH is no longer just static billboards by the side of the road – the business model of the whole industry has fundamentally changed.
Cadi Jones, Clear Channel
Its CEO Cennydd Roberts says the waters are less muddied for marketers when it comes to out-of-home. He explains: “All of the benefits of digital, such as immediacy, flexibility and bespoke tailored solutions, are coming to out-of-home and, at the same time, we do not face the same problems with contextual placement. Advertisers know exactly where their ads will appear because they can see the sites they are booking.”
Over the coming years, Outsmart’s Lumb concedes that out-of-home will experience a decline in ad spend due to concerns around Brexit. He also admits current concerns around advertising on Facebook and Google are only “momentary” and says advertisers will “inevitably” forgive the two.
He believes there’s also a lot for his industry to do in terms of communicating to marketers what the creative possibilities of out-of-home actually are. If it doesn’t, he says, there’s a risk many will still just see the channel as “nothing more than a poster”.
However, with the rise of programmatic changing the face of the out-of-home ad industry, Lumb is confident the momentum of recent years will continue. He concludes: “I used to hear out-of-home described as ‘tweets from giants’, but with programmatic out-of-home it will be more like TweetDeck. We’re on the up and you’d be silly to bet against the momentum we’re currently experiencing.”