With digital marketing dominating industry headlines for the past two decades, business owners and marketing teams could be forgiven for thinking that out-of-home (OOH) or outdoor advertising has had its day.
But think again before writing off this marketing channel because OOH advertising offers unique opportunities that digital marketing channels simply cannot. Putting your brand directly in the hands of customers and connecting with hard-to-reach, underserved communities are only two of the strengths of this type of marketing.
How OOH Advertising is Growing
Mention OOH or outdoor advertising and most people will immediately think of billboards on the side of highways and other major thoroughfares. Subway and train advertising might also spring to mind, but at its core, this area of marketing encompasses all adverts that reach consumers outside of their homes.
At the time of writing, around 5% of the world’s advertising budgets were dedicated to OOH channels. While that may not seem like much, it actually means that brands are spending more on this medium than they devote to radio or print advertising.
Plus, OOH advertising is rebounding and experiencing strong growth. The industry hit a high in 2019, only to plummet in 2020 as the coronavirus pandemic caused mobility restrictions and made OOH advertising less effective. Right now, industry experts forecast that brands will spend just over $42 billion on OOH advertising in 2023. This figure is only slightly less than the spending of 2019, and it is a testament to the sector’s recovery.
Looking ahead, the future looks even brighter. In 2024, global outdoor advertising spend is set to surpass $45 billion. While not every global market is recovering from the pandemic at the same speed, the United States looks to be largely following the overall global trend with 2024 spending surpassing the budgets of 2019. The strategy is paying off with over 80% of consumers saying they have made a purchase after seeing an OOH advert, according to Billboard Insider.
Think Beyond Roadside Billboards
No doubt, much of the recovery of OOH advertising is thanks to people spending more time outside, traveling to work, and using public transport and roadways for other trips. However, part of the revival also needs to be credited to marketers finding more creative ways to connect brands and customers.
New York-based OOH specialists Encompass Media Group (EMG) noticed that brands are looking for more innovative and effective forms of advertising after the pandemic. “Today more than ever, clients need to break through ad clutter,” says EMG Co-CEO Adam Pierce. On average, American consumers see between 4,000 and 10,000 advertising messages per day. As a result of this high volume of advertising messages, brands need to work hard to make a meaningful connection with consumers.
Based on running more than 400 OOH advertising programs annually, the EMG team found that branded coffee sleeves were one of the most powerful locations for advertising messages. “Brands are getting directly into the hands of consumers with those sleeves,” explains Adam Pierce. “Plus, we have found that something as simple as a branded sleeve delivered recall rates of more than 80% for brands.”
Given those figures, it is not surprising that more of EMG’s customers have been opting for branded sleeves over billboards and other, more traditional OOH media. Saying that, there is more to running successful OOH campaigns or integrating OOH into an overall media strategy than the choice of medium.
Aside from putting brands directly into consumers’ hands, senior marketers have found that selecting the right location in which to connect to target audiences may turn out to be even more important. EMG’s Co-CEO Don Winter believes that brands need to focus on places where consumers spend time rather than simply passing through.
“We have built an extensive network that allows us to reach consumers in key locations such as pharmacies, convenience stores, doctors’ offices, grocery stores, laundromats, and more,” Winter says. Like the choice of medium, the selection of locations varies depending on individual brands and their marketing objectives. There is no one-size-fits-all solution for using OOH media to connect with consumers.
How Digital Technology is Changing OOH Advertising
The renaissance of out-of-home advertising is not only a consequence of the waning pandemic. In fact, it is closely intertwined with the growing use of digital marketing channels. Over the past decade or so, advertisers across the United States have embraced digital billboards.
These huge attention-grabbing displays combine the benefits of traditional outdoor media with the engagement potential of digital channels. Rather than showing static adverts or rotating between a selection of static billboards, digital billboards have made it possible to display videos, including 3D videos, and interactive adverts.
The number of digital billboards across the U.S. grew by 80% between 2016 and 2022, evidence of the success of combining digital and OOH advertising. As a result, some of the most innovative OOH advertising campaigns are now categorized as digital out-of-home – or DOOH – advertising.
As a segment within outdoor advertising, digital outdoor advertising is on course to surpass one-third of spending in the sector during 2023. By 2026, DOOH adverts are likely to account for more than four out of ten dollars spent in the field.
Coffee Sleeves or Digital Billboards – Where is OOH Headed?
At first sight, branded coffee sleeves and digital billboards may not have much in common. However, on closer inspection, it becomes clear that both have innovation at their core. Whether brands are looking to connect with consumers over their morning coffee or engage them on a deeper level by revolutionizing their use of billboards, it will take a highly creative approach to stand out from the competition. In either case, out-of-home advertising has the potential to strengthen the marketing strategy of small and large brands alike.
Have you also read these posts?
