OOH’s top priority: A leap in technology

This is one in Media Life’s ongoing series, “Swept by change: The new out of home.” Click here to read our previous stories.

Creativity is the key to any successful out of home campaign. Now, argues Mark Boidman, managing director at Peter J. Solomon Co. and a leading authority on OOH, creative thinking needs to be applied behind the scenes as well. He believes the key to the continued growth of the industry will be in adopting technologies that make buying OOH easier while enabling advertisers to better gauge their return on investment through improved measurement of the medium. He recommends the rollout of an automated buying platform to help streamline buys. And he says beacons, which allow billboards and other signage to communicate with passersby and vice versa, hold great promise for measurement. His recommendations come at a time when TAB, the industry’s measurement body, is searching for a new leader and a new direction. Boidman talks to Media Life about all these concerns and more in a wide-ranging discussion about the past, present and future of out of home advertising.  

 

Tell us what you’re recommending for out of home.

Overall the big theme is certainly how digital OOH and OOH shift to get more of the ad buy. Digital OOH, specifically the digital-place-based networks, has always been a tactical buy, so it’s a matter of converting DOOH into a strategic buy.

And then for OOH, including DOOH, how do you take money from other media channels?

If the out of home industry can increase U.S. ad spend share by even a small amount, that will add dollars to the bottom line.

Among things we’re recommending to get more of the U.S. ad spend is that the OOH industry adopts a universal marketplace platform in order to level the playing field with other media channels, including online video and mobile.

What we would recommend is an open marketplace data management platform (DMP), which would provide the ability to purchase OOH advertising at any point of day from any location. That would streamline the industry.

In other media channels you can more easily buy ads at any time of day from almost anywhere. The out of home industry needs to focus on ease of buying.

We’ll also emphasize using technology to prove the advertising works. The technology exists to measure ROI; we see it in beacons and Wi-Fi technology.

 

What kind of role do you see measurement and attribution technology playing?

The role we see this kind of technology playing is an extremely powerful one in terms of the data and insights it can provide advertisers. We want to see technology deployed across OOH inventory, whether it’s digital or non-digital inventory. Beacons and Wi-Fi technology will show, with accountability, how many views or impressions a digital or non-digital ad gets.

You’d be able to tell how long people stood in front of a display and whether they’re engaging with it.

Beacons allow you to communicate with the viewer. They also tell you frequency. With these technologies you could say, for example, with certainty that from 3-5 p.m. on a Monday this is how many men or women walked in front of your sign. And also what percentage are new people, which are repeat people, etc.

When you’re on the go viewing advertisements, you’re more likely to make a purchase.

With that in mind, you could actually have a sensor or beacon on a display, and then also one in the store. So let’s say a retail store had an ad at a bus stop. You could have a beacon or sensor at the physical store as well, and then measure using data from both locations whether people who walked past the ad subsequently visited the retail store and how much time they spent inside the store. It’s all useful data.

The big OOH companies are all experimenting with these technologies. We’re saying they should stop experimenting and adopt them. The issue is that advertisers are not yet asking for them and haven’t yet signaled willingness to pay more for OOH that features them.

It should be noted that these changes are probably not going to immediately take OOH’s total ad spend to $10 billion [up from $7 - $7.5 billion]. But the effect will be to put OOH more on par with other media and redirect dollars to OOH over time.

We think technology can help make this happen.

 

What is the open structure data management platform you envision? How could it help out of home?

We envision an open marketplace, so anyone could plug and play with it. Each agency would have its own intersection point.

It would need to include avails so people could buy ads at any time of day from any location.

The challenge is that each of the big U.S. OOH companies, which control two-thirds of the marketplace, is adopting its own platform. Each views it as a competitive advantage to build their own.

What we could recommend is that the other one-third of the marketplace get together and create their own data management platform that’s open. It may serve as an example for the larger companies and get them to think about a DMP more broadly for the whole industry.

Data from open-structure DMPs would also allow you to target specific audiences. So it could be Facebook moms, for example, and the data would allow you to have targeted campaigns and would level the playing field with other media channels.

 

Have ad agencies been helpful with respect to the DMP or automated buying concept?

Some ad agencies are helpful. They recognize it’s change they need to embrace. But other agencies have inhibited the process.

They have made money doing business the old way and have resisted adopting these new technologies. In addition to that, the agencies operate in media channel silos, which is another issue.

Is it OOH or mobile or digital video? The lines are blurring and we don’t want it to end up nowhere. We need to work on all of this.

 

How would you rate the current measurement system in place for OOH?

We certainly have said in the past that we don’t love it.

There’s an opportunity to improve it, as there is with any form of measurement. Once they find new leadership at TAB, we think they’ll implement steps to rethink measurement, and I think it’ll lean in the direction of using technology for accountability and for credibility.

We think there’s a much better method of accountability than the TAB rating system today, which was developed using eye tracking and viewability research. Ideally these new technologies would supplement the existing TAB system.

With smartphone and beacon data, you can get a lot of insights, not only how many people see the ad but whether people are engaging with the ad. 

 

What recommendations do you have for using technology to demonstrate ROI in OOH?

There are two ways. The most logical way is if you take Penn Station, for example, and put up an ad and look at the behaviors.

Let’s say it’s for Starbucks. The first measurement would be what’s happening without an ad, and then what happens with one. Then the technology can show you the attribution: X people walked into Penn Station and then ended up at the Starbucks across the street.

That’s how you prove the ROI; it’s having beacons or Wi-Fi sensors in both locations.

What would be even more powerful is if somebody proceeds to Starbucks and then pays with their phone. That data could be sent back through the technology, and then you could see that they saw the ad, then spent 20 minutes at Starbucks and spent $20.

 

How long do you think it would take to implement such a system nationally?

The technologies exist today. OOH operators are experimenting with companies like Euclid and Gimbal, who are persuading OOH companies to implement these technologies nationally. I think it will happen as soon as the brands start asking for it and paying for it.

Will the brands pay more for such data and attribution? If they don’t, it will take longer to convince OOH companies to roll out these technologies.

But it’s inevitable. At some point the industry will have to adopt these types of technologies.

 

What’s the state of the out of home ad economy? How has it changed since the last time we talked?

I think we’re still seeing nice growth in the overall ad market. Dollars are increasing overall. In fact, U.S. ad spending will see the largest increase in 2015 than it has seen since 2004. Most of that is because of internet and mobile advertising.

In terms of OOH media, we certainly see it as growing, but we don’t see it growing as quickly as mobile and online video.

But if you look at the traditional channels, OOH is the only one that’s growing. Newspapers, radio and magazines are down, and OOH is up. We see it growing over the next few years, with technology as its friend, while those others will continue to decline.

 

How does the current state of out of home advertising compare to other traditional media?

It depends on how you define traditional media.

We view mobile, social and online video as new media. Then you have to think about how you categorize TV.

TV is increasing because of on-demand TV and non-traditional models like Netflix and others. TV viewing is up but traditional TV is actually decreasing, and we see this year as being a weak year for the upfronts in TV advertising.

There will probably be a decline of mid-single digits, and advertisers will commit fewer dollars.

Some of those dollars are going to non-traditional TV or other new media channels. While national TV ad revenues will decline, we don’t see that being the case for OOH.

We see OOH growing low to mid-single digits. So that’s the good news. But the bad news is there’s a risk that if they don’t adopt new technologies, OOH may fall into the category of other traditional media and see declines.

 

What’s the biggest issue that needs to be addressed in out of home advertising right now?

One thing that’s interesting, and a final point on why we like OOH, is there’s increasing development and use of ad blocking technology for digital formats.

While today there’s a huge push for online video, if people are able to skip online ads that will benefit OOH. Nobody wants to push money into a channel where there’s ad-blocking technology.

OOH is always on, it’s never off or able to be skipped or turned off; it’s part of the physical environment.

What we also like about the industry is there’s no fraud. In online video there’s the issue of which ads are being seen by humans, so again, an advantage for the OOH industry.

These are some of the topics we’ll get into at the upcoming OAAA-TAB National Convention.

 

 

 

Tags: Mark Boidman, OOH, ooh advertising, ooh forecasts, out of home, out of home advertising, Swept by change