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InContext / An inside look at the business of digital content

How out-of-home is evolving to join the digital paid media mix

November 8, 2016 | By Joe Liebkind—Independent Technology Journalist@JoeLiebkind

Out-of-home (OOH) advertising has been around for generations in the form of billboards, posters, public transport hub walls, bus benches and more. While these paid media placement opportunities are still around, they’ve been quietly undergoing some significant digitally-enhanced upgrades, including programmatic bidding, viewability tracking and intent-oriented targeting.

As a result, OOH is the first “offline” media realm to join the ranks of connected digital media platforms. Let’s look at how this trend is taking shape.

Why Media Buyers are Looking for Better Digital Options
In the early days of the internet, display ads were all marketers needed for their messages to be seen. Now, however, the vast majority of display ads, both on desktop and mobile, don’t command much attention at all.

This is largely because audience members have become desensitized, developing “banner blindness. However, there are plenty more issues in play: ad blockers, viewability measurement challenges, bot traffic and rampant fraud, all of which are making alternative digital ad media types increasingly attractive to buyers. One study from Integral Ad Science found that just 43% of online display ads are “human-viewable.”

Naturally, as a result of these challenges, advertisers and media brokers are hunting for new ways to reach eyeballs. If no one pays attention to your ads, then you’re simply wasting your money.

Why Media Buyers Struggle to Justify Unmeasurable Placements
In the age of granular conversion tracking and sophisticated attribution modeling, media buyers need to have the ability to demonstrate a return on investment (ROI) on their placements. This type of measurement is relatively straightforward when buying ads on Facebook, for example, but most offline media simply can’t compete in this regard.

If they can’t prove how many people saw or remembered the ad, and then gather data suggesting the extent to which the ads impacted sales, they can’t determine whether the buy was any good. It’s easy to run an ad continuously – knowing how many people saw and paid attention to it is the challenge.

Online media has, to a large extent, spoiled the viability of buying offline media. We have access to all this big data – nearly anything done in the digital world can be traced with ease – which makes it easier for marketers and other professionals to see what’s happening as a result of advertising. That’s why there’s rising demand today for similar tracking in offline media too.

The day may come when print publications use internet of things-enabled nano-chips to track ad views and attention biometrics to collect data that will later be used for audience segmentation, automated nurturing and strategy refinement. In the meantime, only outdoor advertising has the one-to-many reach to justify investing in better transparency and reporting for advertisers and media buyers. That said, smart industry players are evolving cautiously, as “big brother” privacy concerns come into play whenever behavioral tracking comes up.

Digital out-of-home media is therefore steering clear of keeping records associated with individual audience members, with several initiatives now in play that can provide performance metrics based on attention-correlated eye movements. Trade groups like Route and TAB now offer media measurement and audience estimates for OOH advertising in the UK and the US respectively.

How Digital OOH Is Addressing Offline Media Accountability 
OOH sellers are investing in development as well. Clear Channel Outdoor Americas is partnering with mobile carriers like AT&T to track whether people who see billboard ads eventually buy the products promoted. “In aggregate, that data can then tell you information about what the average viewer of that billboard looks like,” Andy Stevens, senior VP of research and insights at Clear Channel recently told the New York Times. “Obviously that’s very valuable to an advertiser.”

Following a successful pilot last year, with 1000 screens placed in 20 supermarkets across Canada, Montreal-based Impax Media recently hired Dominick Porco and Bill Ketcham, both alumni of the Adspace Digital Mall Network executive team, to oversee the relatively new company’s push to take over the US.

The Impax platform offers digital advertising on screens mounted at the checkout line at grocery stores and other retail outlets. Impax’s screens can be seen whether the lane is closed and locked or open and in use. Each screen provides advertisers with the information they need to track ROI on media spends, while protecting viewer privacy. The screens are set to display brand-sponsored content and store announcements, running in a loop.

“Our plan is to install an average of eight screens per month in each of 167 supermarkets, starting in August of this year,” says Porco. “At that rate, Impax will be active in 10,000 supermarkets within five years, reaching over 130 million shoppers every four weeks, on a network that will consist of 80,000 screens – by far the largest digital network in the US.”

The Internet of Things Makes Programmatic Booking Possible
For those interested in enabling it on their smartphones, beacon technology allows people to receive notifications about sales at stores as they pass by them. With beacons and near-field communication (NFC), advertisers can more accurately target people based on their location away from home, when they are 41% more receptive to advertising. So advertisers can already target people based on where they are, whether serving up messages via mobile push notifications or via video clips on big, wall-mounted screens.

With programmatic bidding currently under development for the OOH industry, buyers may soon be able to more accurately target their appropriate audiences, and sellers will benefit from being able to offer a fully optimized media asset.

Imagine the power of being able to serve up messages to individuals, no matter where they go in the real world. Creepiness aside, this is personalization at its most extreme. pers

Programmatic DOOH will allow marketers to reach audience members in high proximity to points of purchase, across multiple touchpoints, and on a budget that works for the client while also meeting business objectives. With the Internet of Things (IoT) infrastructure on the rise and back end targeting processes ready to take place in real-time, this type of contextual relevance is around the corner.

The Benefits of Today’s OOH Placements
In the age of complex, individualized customer journeys, media buying success hinges on omni-channel exposure, and digital OOH is proven to be a major performer in this regard. A study from the Outdoor Advertising Association of America found that when people see OOH ads and eventually interact with advertisers online, nearly a quarter of these interactions take place within 30 minutes of viewing.

DOOH is proven to be cost-effective, too, with CPMs (cost per thousand impressions) starting at $1.50 and maxing out at about $35, according to one recent industry-wide inventory assessment. The only media channels that are less expensive – radio, magazines and static billboards – feature zero viewability reporting capabilities.

OOH advertising’s joining of the digital paid media mix means people are exposed to promotional content that they actually want to see. This increases the chance they’ll respond to the ads positively, boosting conversion rates and profits for the advertisers, while earning money for venues as well.

JoeLiebkindJoe Liebkind is a Berlin-based writer. He has worked with startups in sales and marketing roles in Berlin and New York. Find him on Twitter.

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