• by Joe Mandese  @mp_joemandese, October 11, 2010

In what is likely the most comprehensive study of its kind, new research being released today by out-of-home media giant Clear Channel Outdoor shows that out-of-home media impacts product sales as well as major media such as TV, radio and online, and that when used in combination with those electronic media options, can greatly increase the sales effectiveness of advertising campaigns. The study, which Clear Channel touts as a "first ever," models the incremental contribution out-of-home media has on sales effectiveness when all other variables (including other media and promotions) are accounted for.

The study concludes that the "optimal" amount of advertising budgets allocated to out-of-home media should range between 5% and 25% of a typical brand's media mix, though higher percentages would be even more optimum for certain brand strategies. That is considerably higher than out-of-home media's current share of overall ad spending, which is currently under 5%, even though the medium has been expanding with a wide variety of digital out-of-home options, and it has adopted what many believe to be the most rigorous standard for measuring audience exposure - a so-called "eyes-on" method that credits audiences who are actually likely to see outdoor ads, as opposed to the standard for most other media, which still are based on opportunities to see or hear advertising messages.

"With eyes-on metrics and digital, we can go after budgets that were designated for television and radio and online and print," says Debbie Reichig, senior vice president of business development and marketing at Clear Channel Outdoor, who commissioned MarketShare Partners, a highly regarded marketing mix modeling firm, to conduct the study as a means of proving out-of-home's relative contribution in the mix, and to overcome the historical objections of advertisers and agencies to allocate more of their budget to the medium.

In effect, Reichig is utilizing the same tool - marketing mix modeling - that big packaged goods marketers and their agencies have been using for the past couple of decades to rationalize the high levels of TV advertising in their media mixes. The first generation of those models did prove the role TV has in generating incremental product sales, but some critics argued they didn't do a good job of measuring the effects of other media, because they lacked the proper data inputs. Both the online and magazine industries have invested heavily on developing similar inputs to prove their role, but Reichig says the out-of-home media industry largely ignored the problem, opting instead to fight for share within their relatively small slice of the media pie.

Armed with the new research, Clear Channel Outdoor's marketing team is about to make a lot of noise with it, including heavy promotion at this week's annual meeting of the National Association of Advertisers in Orlando. Among other things, Clear Channel will have a booth pitching marketers on the new findings and will distribute executive summaries of the research via "room drops" outside the hotel room doors of top marketing executives. In the weeks that follow, the Clear Channel team will be making personal sales presentation calls on the biggest advertisers and agencies in the nation to help hammer the message home.

"It's going to be an office-by-office kind of communications," says Reichig, who helped move the needle in a similar way in her previous roles as a top marketing and research executive for the cable TV and online media industries, and who is now applying her knowledge of marketing effectiveness - and an ample research budget - to the cause of out-of-home media. But she is doing it in a somewhat collegial way, providing research on the role out-of-home media plays alongside the other major media - especially TV, radio and online, and even newer versions like social media - that typically take a greater share of most marketers' advertising budgets.

"People are trying to figure out how to monetize social networks," Reichig cites, as an example, adding that it nonetheless is difficult for many marketers to "scale" social media campaigns and drive people to a brand's Facebook page or other social media strategy. "Out-of-home is a great way to do that," she says, citing research proving its ability to generate awareness, even for a media outlet as au current as Facebook.

And when newer forms of digital out-of-home media options are added to the mix, something Reichig says was too new to be factored into the extensive, longitudinal study conducted by MarketShare Partners, she says out-of-home can really begin to impact perceptions on the relative effectiveness of media in most marketers' mixes.

"Digital, combined with the eyes-on metrics, lets you look at the media mix with out-of-home in it," she notes, which we never able to do before, because we never had real ratings, or reach and frequency curves. We have that now, and can plug it in and see the contribution out-of-home makes in the mix."