One common statement early in the pandemic was that there are Covid-advantaged businesses (think: video conferencing) and Covid-disadvantaged businesses (think: travel). That same concept is starting to rear its head in another upheaval: privacy reform. There will be winners and losers.
The companies and ad formats suffering most include anything that involves third-party data used to target individuals. It also includes behavioral targeting more broadly. The former places greater value on entities that have large insular first-party networks (like Amazon), and is a story for another day.
But the latter brings about a return to contextual advertising. In other words, before web 2.0 (and digital media in general), a common standard was targeting ads based on adjacent content. As we examined recently, this has accelerated ad budget shifts towards CTV and streaming video.
But there’s another beneficiary for many of the same reasons: out-of-home advertising (OOH). This includes digital displays that are evolving and invading places like bus stops and retail endcaps. And it involves these digital formats’ analog cousins such as billboards. Either way, things are looking up.
Brand Narratives
Supporting all of the above, a recent brand marketer survey from OneScreen.ai (n=600) signals meaningful ad budget shifts. Specifically, 97 percent of respondents indicated that they’re actively looking for alternative advertising formats and channels. And a decent portion is flowing into OOH.
Specifically, one-third of marketers say they’re testing OOH ad placements as an alternative. Moreover, 92 percent plan to grow OOH’s budgets this year compared to last. When asked to define driving factors, 93 percent of respondents claim that OOH is effective in reinforcing brand narratives.
One driver besides marketers moving away from the headaches of privacy-scrutinized ad media is simply a need to follow the eyeballs. 60 percent of survey respondents claim that their target consumers are moving away from social media. This is due to a combination of mistrust and growing digital fatigue.
Joining that trend is evolving efficacy in OOH, specifically in analytics. Traditional methods were always seen as rather blunt (including counting cars for impression metrics). But 92 percent of respondents say they now trust a variety of attribution methods including promo codes and unique landing pages.
More importantly, all of these advertiser sentiments (which can be aspirational in any survey) are already having a real-world impact. OneScreen.ai reports that OOH ad spend grew 72 percent in Q1. And most of this spending came from elsewhere in the ad budget, rather than larger overall budgets.
Macro Factors
Back to Covid, that’s also having an impact according to OneScreen’s survey. Accelerated digital adoption has created more competition in online marketing. It’s not a zero-sum game when ad inventory is abundant. But it does impact paid search bid marketplaces or SEO in popular categories.
For example, 77 percent say that boosted online marketing adoption in the Covid era has elevated SEO competition in key search categories. 61 percent say that there’s now stiff competition from deeper-pocketed brands. That not only means scarce SERP inventory but more bid pressure in paid search.
So it appears there are several upheavals and macro factors that continue to have ripple effects on brand marketing and advertising (which in turn trickles down to SMB markets). We’ll keep watching for evidence of these and other influential forces on advertising budgets – for brands and SMBs alike.
