Enhancing Out-of-Home (OOH) Efficiency through Digital Formats
The year 2020 presented a unique challenge for the out-of-home (OOH) advertising industry as the pandemic resulted in a significant decline in audience engagement, leading to a decline in advertising revenue. OOH sales hit their lowest point during the lockdown period, particularly in April, May, and June. The Russian Association of Communication Agencies (AKAR) reported a 30% drop in OOH advertising volume in the first half of 2020, with OOH traffic decreasing by three to four times in certain months. By the end of the year, the overall decline in the OOH segment was 27%, with cinema ads (-70%) and indoor ads (-50%) suffering the most significant losses. Revenue from transit media decreased by 38%, and outdoor advertising revenue decreased by 22%.
However, the digital out-of-home (DOOH) market in Russia showed promising growth during this challenging period. AdMetrix estimated that the decline in the DOOH market in 2020 was only 8%, compared to the 31% decline in traditional inventory.
RMAA Group, a company providing OOH services, operates throughout Russia and the CIS countries.
Triggers for OOH Development
Given the circumstances, companies began to focus more on their digital inventory. The trend of digitalization in the OOH sector had already begun in Russia in 2019. However, the COVID-19 pandemic and the subsequent lockdown period acted as a catalyst for the development of the DOOH segment and the transition from traditional static advertising media to more innovative digital formats. New Digital Content Platforms (DCP) emerged in the market, offering programmatic buying of OOH inventory, allowing advertisers to pay for target impressions only.
The DOOH segment is experiencing growth in Russia. AdMetrix reports that advertisers’ expenses related to DOOH account for 41% in Moscow, 31% in Saint Petersburg, and 27% in other Russian regions. As the DOOH share increases, the number of players in the market is also growing.
Amidst the crisis and fluctuating restrictions, advertisers have shown a preference for digital formats, which offer the flexibility to suspend or modify campaigns, adjust budgets, and optimize targeting. It is evident that digital formats will serve as the foundation for the growth of the entire Russian out-of-home industry in 2021.
OOH Development Trends
The out-of-home (OOH) market is witnessing several notable trends:
- Inventory Digitalization and Audience Data: The industry is embracing digitalization, utilizing technologies like Wi-Fi, smart cameras, and smartphone geodata to collect audience data for better targeting and campaign optimization.
- Market Consolidation: Mergers and acquisitions are reshaping the market as players join forces to enhance capabilities and expand their reach.
- Placement Flexibility: Advertisers seek greater flexibility in OOH placements, enabling quick changes in layouts, testing different scenarios, and launching campaigns nationwide for various periods.
- Personalization and Nativeness: Advertisers are focusing on creating personalized and native ads that resonate with the target audience, increasing engagement and relevance.
Improving DOOH in Russia:
- Media Coverage: Ensuring an adequate number of advertising structures in strategic locations to reach the target audience effectively.
- Attention-Grabbing Content: Encouraging advertisers to create captivating and unconventional ads while utilizing engaging information in remnant blocks to pique the interest of potential viewers.
- Technological Advancements: Leveraging technology to analyze audience profiles near OOH structures and provide accurate data on ad viewership.
- Audience Retargeting: Collecting data in real-time, analyzing audience traffic, and utilizing digital retargeting techniques to personalize ads based on viewer preferences. For instance, SYNAPS can adapt content displayed on digital supersites in real-time, targeting specific drivers.
With advancements in technology and the growing role of SSP platforms (Addreality, VDOOH, liqvid, DOOH ADS, etc.), OOH has become seamlessly integrated into the digital landscape.
In 2020, advertisers placed a strong emphasis on evaluating campaign effectiveness and return on investment. Wi-Fi radars on digital billboards became popular, enabling the collection of extensive data that, when combined with third-party enrichment and other sources, allows for effective ad targeting and campaign analysis. These tools provide advertisers with the means to optimize their expenditures during economic downturns.