Out-of-home has always been the ugly stepchild of the media industry. It was still paper and paste when everything else was going digital. Or so goes its reputation.
So it’s always interesting to hear a smart person working in the OOH industry talk about what is really going on. This morning at the Localogy 20/20 virtual event that person was none other than Andy Sriubas, who is chief commercial officer at OUTFRONT Media.
First, we got a quick lesson on the size and scope of OOH. Pre-COVID, this was an $8 billion industry in the United States. And we are not just talking billboards. Out of home is exactly what the name suggests. It’s every form of advertising that isn’t delivered into the home. That includes billboards, obviously. But also transit signs, movie theater pre-roll, those ads they serve you while you’re pumping gas, ads in stadiums, convention centers. You get the idea.
Andy described OOH advertising as “the world’s second-oldest profession.” This presumes cave paintings had sponsors. There’s a Flintstones joke in there somewhere.
Not Your Uncle’s Ad Medium
Digital OOH, not surprisingly, has transformed OOH from paper and paste into something more interesting. And targeted.
“It used to be about a screen or a sign on a wall,” Andy explained. “People would pass by, and hopefully it would deliver some value.”
Now, digital out of home ads can adapt messages to time of day, changes in the weather, and other triggers that signal a change in content. The entire workflow is digitized. Messages can be moved around based on where the audience is.
Andy said OOH is at the point where it can offer CPM based pricing, which enables comparisons to TV, radio, and mobile advertising.
Crushed by COVID?
Given people generally stopped commuting when the stuff hit the fan back in March, you’d assume OOH (the only traditional media growing pre-COVID) took a big hit. And it did. As Andy said, perhaps with a little understatement, “It has taken us back a step.”
But Andy notes the impact varied by region. And he would rather be in OOH now than other traditional media. “Newspapers and magazines will be hit harder than us.” Unlike those media, which are having terminal declines accelerated by COVID, he expects OOH to make a full recovery.
“It came back faster than most people thought,” he said. “People still left their homes to get groceries. The billboard on the way to the office saw less traffic. But views of the billboard on the way to Home Depot increased.”
He also doesn’t believe changes like work from home will necessarily decimate billboard ads. This will just increase billboards in other traffic patterns. Less the downtown commuter route. More suburban Home Depot route.
The 5G Impact
One key thread of Andy’s conversation with moderator Dan Hight was 5G and how it would impact the OOH industry. Andy said the impact will be positive. After all, he says OUTFRONT is as much as a location-data company as it is a billboard company.
And he noted something else we weren’t expecting. OUTFRONT, and presumably other OOH companies, will generate a secondary revenue stream essentially from renting out their billboard poles to 5G carriers in need of additional points of presence.
The Autonomous Car Fallacy
Andy was skeptical of the notion that autonomous vehicles would be the end of OOH, or at least the billboard portion of the business. The presumption here is that the eyes of passengers in autonomous vehicles would be glued to their phones or some in-car entertainment system (another OOH opportunity presumably) and they wouldn’t look at billboards.
“There are some draconian scenarios, but that world is far away,” he said. “For now, people still need to grip a steering wheel.”
Out of Home – Finally a Seat at the Table?
Out of home was the only traditional media that was growing pre-COVID; then we told everyone to stay home. Things have changed, but we are no longer shut down. Which platforms, operators and solutions will lift customer experiences to drive accelerated demand and growth?Speaker(s):
Andy Sriubas, OUTFRONT Media