Social media, podcasts, search engine ads, and AI-created ad copy generate buzz, but a study on out-of-home (OOH) advertising released this week estimates that 88% of adults notice OOH ads, and nearly 80% of those viewers are inspired to take action.
The data is based on a November 2022 poll of 1,461 adults conducted by Out of Home Advertising Association of America (OAAA) and Morning Consult.
Among the 30% of adults who recently noticed an OOH ad that gave directions to a store or business, the data shows 43% visited the store, business, or restaurant within 30 minutes of seeing the ad, and 78% of those visitors made a purchase.
OAAA President and CEO Anna Bager refers to OOH as performance advertising and points to data showing it as one of the fastest-growing ad media in 2022.
Search & Performance Marketing Daily talked with Bager to get her views on the current state of DOOH, how DOOH ad tech has evolved to meet the challenges that face the channel to make it increasingly programmatic and improving measurement and targeting.
S&PMD: How is DOOH driving growth across the overall OOH industry?
Bager: Let me take a step back to say that OOH was the fastest-growing ad medium in 2022. While the year-end numbers for 2022 are still being finalized, I can share that DOOH overperformed with growth rates near 25%, which represented almost 30% of total OOH advertising spend.
The future looks even better as DOOH is projected to reach more than 40% share of total OOH in the next couple of years. This is the kind of growth you’d expect from a startup, not a medium that has been around for centuries. It’s great to see our industry thriving across the entire sector. So yes -- a rising tide lifts all boats.
S&PMD: With growth in consumer favor leaning toward contextual advertising, how is DOOH’s dynamic platform matching brand needs and consumer preferences?
Bager: Understanding what consumers want is key to making sure brands take advantage of the medium in the best way possible. For example, research shows that creative messages oriented toward convenience and context resonate the most with consumers –– such as products related to current weather conditions, food options, and offers that match the time of day.
Imagine seeing an ad on a digital board that shows a beautifully designed Dunkin' coffee cup with the current temperature as part of the message, and a welcoming message that you deserve a coffee break. You’d probably jump into a store to get one. You’re not alone. Nearly half of adult consumers find contextual DOOH ads of greater interest.
S&PMD: With the use of QR codes increasing, does this mean OOH can be considered performance advertising?
Bager: OOH and DOOH should be considered by all brands focused on performance marketing, because OOH is the most efficient ad channel in driving online activation per ad-dollar spent. In fact, OOH’s highest indexing activations are social engagement, search, and online purchasing.
Over two-thirds of Gen Z and Millennials recall seeing OOH ads reposted in social media.
The struggles digital media is experiencing with the loss of consumer data and campaign tracking leads are causing digital marketers to scramble to find the right partners. This situation enhances OOH’s value even more, as OOH is a highly efficient conduit for brands to build first-party data.
With the explosive use of QR codes the past few years, OOH has benefited from the rebirth, with many DTC brands in particular incorporating QR codes in their campaigns. In urban markets with populations of more than one million residents, 48% of consumers express an interest in special sales or deals offered through QR codes.
S&PMD: How does DOOH advertising compare to other advertising channels in terms of reach and effectiveness, in your opinion, and what role does data play in increasing the effectiveness?
Bager: Thanks to DOOH’s massive footprint, it generates higher recall than all other forms of core media (on average recall in the range of 46% - 84%) and delivers great value with highly competitive CPMs.
To give this some context, we partnered with Place Exchange to examine how programmatic DOOH competed against the $7 million cost of a one-time, 30-second TV ad that runs nationally (hint, hint, bet you can guess what that buy was). For the same cost, a brand could invest in a robust programmatic DOOH campaign that spans the top 27 US markets for four weeks with a total of 600 TRPs, earn nearly one billion impressions, and achieve an average reach of 78% and a frequency of almost eight (7.8). Now, that’s what I call a “super” smart buy.
S&PMD: DOOH is expanding, especially with various key players like The Trade Desk and Google managing inventory. What is your industry doing to drive adoption and growth of programmatic DOOH and what trends are you seeing?
Bager: As the OAAA, we’re constantly meeting with brands and agencies to evangelize the story and vision for DOOH.
We’re aiming to drive competition with the biggest digital ad platforms, and some of them frankly want to play in DOOH space –– like The Trade Desk and Google. We embrace that. It’s no surprise that eMarketer projected that programmatic DOOH spend would grow by 100% in 2022.
There is so much opportunity in this space -- especially for the top four programmatic DOOH categories.
We’re excited to see the exponential growth of DOOH. From the adoption of OpenDirect to the integration of OpenRTB, we’ve made great strides in advancing automation across the industry.
Programmatic buying and automation will be huge drivers of growth for DOOH in the years to come as they lower the friction and increase transparency for advertisers interested in entering the space.