ANALYSIS: Behind the billboards in Australia's out-of-home market

Josh McDonnell
By Josh McDonnell | 25 February 2020

This first appeared in the AdNews February edition. Subscribe here for your copy.

In the last 12 months, change has been the aim of the game in out-of-home. As the dust finally settles on the oOh!Media and JCDecaux acquisitions, the major players have all turned their heads to beefing up their digital, data, dynamic and targeting offerings. In our first agenda for 2020, we get behind the billboards and take a look at what is making waves.

Outdoor has had a tough year, anyone in the industry will agree. However, they will also tell you it hasn’t been as bad as others and, as the third most popular media channel, that’s a pretty good result. Out-of-home (OOH), while resilient, is also an industry that continues to push for more. More ad dollars, more creative campaigns and more effective ways to communicate with consumers.

Over the course of 2019, major players oOh!Media and JCDecaux have been busy integrating their acquisitions of 2018, Adshel and APN Outdoor, respectively. During this time, the likes of QMS and Val Morgan Outdoor have been looking at ways to better develop their own tech and data platforms. While all this goes on, Woolworths also launched its very own offering, Cartology, which gives buyers access to the extensive portfolio of digital screens located throughout the grocery chain’s network.

For oOh!Media CEO Brendon Cook, 2020 is very much about “unlocking the connection between consumer data and advertisers”. Late last year, the business launched Smart Reach. Said to be a “global-first data proposition of its kind”, Smart Reach combines anonymised data sets, enabling advertisers to “maximise their media spend” and reach 25% more buyer audience through unmatched targeting across the media landscape.

The platform ensures brands are targeting the right audience and provides access to more than 500 specific audience segments based on buyer graphics, demographics, psychographics and consumer behaviours.

Cook says, based on the early work done around Smart Reach and from the independent work on mixed market modelling by analytics partners, a great out-of-home campaign that gives the highest return usually involves three different formats.
“Our data scientists have been working hard on how you match inventories together to get the right reach frequency to various different audiences within any of those segments across multiple products,” Cook says.

“This also includes which products work better with each other for different audiences, and all that is critical not only to continue to deliver for clients a better campaign, given we now know not only here in Australia but globally people take a category buyer audience approach rather than a reach frequency or a demographic audience approach.”

Rival JCDecaux has also been hard at work, revealing a slew of new large format pricing and advertiser initiatives over the course of 2019. These plans were part of what it calls its new “audience-led future” strategy for its large format portfolio, creating advanced data planning capabilities and standard one-in-six share of voice for digital advertisers.

Since acquiring the large format portfolio in the APN deal, the business has been on a mission to bring greater relativity and significant rate card reductions across the portfolio, with a significant overall rate card reduction across its digital large format portfolio.

JCDecaux also introduced a reduction of total large format digital contacts by 40%, with the intention of bringing greater accountability of audience reporting to the industry. This included reducing the number of advertisers displayed on each digital billboard from 10 to six.

This is in line with JCDecaux’s global best practice, with the change expected to increase viewability and deliver a 67% uplift in share-of-time for advertisers across its digital large format network.

“We launched that in the middle of July and that was really to give some relative value to specific sites based on certain criteria," says JCDecaux ANZ CEO Steve O’Connor. "The key thing has been moving to a one-in-six standardisation across our digital billboards, as opposed to one-in-ten. The market’s ready buy into that.

“The consequence of that was we’ve signed some very substantial partnership deals off the back of that proposition. We’re standardising the amount of slots per loop. Where we stand, in the majority of cases that’s 10 seconds but in some cases, it could be 15 seconds or even a minute, depending on what the approval is that the regulatory authority has provided us but nonetheless, it’s only one of six advertisers, not one in ten."

O’Connor adds that some of the really substantial campaigns that JCDecaux has signed to date, and the partnerships bedded for 2020, indicates the strategy is proving the effectiveness of digital OOH campaigns.

Programmatic and automation
One of the most significant talking points in OOH remains the rise of programmatic and automated buying of digital screens. Those in both publishers and agencies agree that the conversation will come to the forefront in 2020, as each player develops teams around both the supply and buy-side of the story.

QMS national sales strategy director Christian Zavecz says the industry is in “an interesting situation”, as everyone is beginning to recognise there is a need for a degree of automation but says the industry shouldn’t ignore the nuances that come with applying automation and programmatic to outdoor.

“One barrier has always been around again just the nuances with our particular medium versus other forms of channels. It’s because there are these qualitative elements that are very difficult to put into the system,” Zavecz says.

“If you think about some of the large format sites, their value is not just in their location or their audience but it’s in the structure that they have and it’s in their ability to target consumers at different points and times.

“It’s just more about us not being a real spots and dots medium, so how do we really get that true value for a large format site, as opposed to something that can be more commoditised like a retail panel, for example.”

Magna Global Australia CEO Victor Corones says programmatic for OOH is inevitable. However, he says the industry must fully appreciate it has to be on terms that media owners are comfortable with to get them “on the path”.

He says what’s critical is how value can be created by media owners in a programmatic world; for clients as well as the owners of the real estate where panels are located.

GroupM ANZ chief investment officer Nicola Lewis says programmatic digital out-of-home (DOOH) is one of the two major developments in OOH that the group will not only be watching but working very closely with its clients on to utilise it to drive growth as part of their marketing strategy.

She says the introduction of programmatic will not only enhance the channel, but enable clients to take a more fluid, “always on approach” to the OOH medium. But adds it has work to the same quality standards as other media.

“DOOH has an incredible opportunity to continue to reinvent itself through content and tech – much like the TV industry has. We are looking for the industry to come together and work together to redefine the medium,” Lewis says.

“From a programmatic perspective, a client’s campaign will only be truly successful if we are able to optimise to performance – which means optimising across all available DOOH inventory. I would hate the OOH industry to get stuck in the belief that programmatic leads to yield erosion – it’s fundamentally untrue.”

However, Cook says there are still some issues surrounding the evolution of programmatic. What he sees is the word programmatic, even automated trading, becoming overused and simplified.

He says there’s a lot of “smoke and mirrors” in what is being reported to the market on programmatic platforms.
“Ultimately a programmatic platform of any description has to be able to deliver the right audience with advanced and sophisticated data matched to right inventories at the right time that suits the advertiser requirement. In reality, that is not what most systems truly deliver,” Cook says.

“To do that you have to make sure that your operating platform and the way you are structuring your business can deliver into that sort of ecosystem and that’s what we’ve been building extensively.

“Unless you can connect and provide that qualitative data, the quality of the data location to match the audience requirement, the client’s objective, you’re not delivering true automation programmatic, and that is what we’ve been trying to get to.”

VMO managing director Paul Butler says his business, which primarily utilises smaller screens located in areas such as service stations, is already making strides in achieving an effective programmatic offering.

Due to the nature of VMO’s portfolio, the business is utilising a facial recognition tool called Dart, which measures audiences and delivers 10 million impressions a week.

He says it is increasingly becoming a vital tool in developing its programmatic offering as clients continue to look for easier ways of adjusting campaigns by time, location and other audience metrics.

“What we’re going to do that’s unique for the market is work with an independent research agency who are going to take our Dart data and model it with other available third-party independent sources of audience data,” Butler says.

“Then we will create an audience metric that we can provide the programmatic SSPs with our data so that if you are ad serving impressions across our network, we will be able to match up the appropriate level of audience statistically that would meet with that impression at that period of the day."

Butler says programmatically what clients can then do though is skew that audience to a specific objective of their campaign.

Delving into dynamic OOH
Another underlying factor in the OOH industry has been the rise, or in some cases, lack-there-of, of dynamic digital OOH.
Dynamic advertising or contextual OOH advertising, uses data to create, change and serve audiences with the relevant ads based on time, location and weather.

In other markets such as Los Angeles and London, dynamic OOH growth has been significant. However, in Australia, many claim dynamic is underutilised.

Dentsu-owned specialised OOH agency Posterscope managing director Bryan Magee says as an emerging media, DOOH was very much “an afterthought” and, in some cases, it still can be.

He says the key component is the creative potential that dynamic DOOH can now offer, which can be at odds with how challenging it can be to source good creative for the medium.

“While there were some ground-breaking creative campaigns at the outset of DOOH’s emergence, most ad campaigns still feature a repurposed print ad that serves as wallpaper for two weeks,” Magee says.

“We still spend lots of time talking to our clients about the ‘Dynamic Difference’; a proprietary study that proves how relevant creative enhances campaign performance. The combined research, collating results from over 20 dynamic campaigns, shows that on average the effectiveness of a campaign increases by 48% if the creative is relevant.”

Magee says with less than 3% of ads using dynamic there is a huge, cost efficient, opportunity for creative agencies and clients to get cut through in their OOH campaigns.

He hopes more creative agencies will realise the opportunity that is “sat right in front of them”.

Omnicom Media Group head of partnerships, outdoor and audio Jo Dick agrees and says that the group continues to see strong growth in the area, though there is still a fair amount of “untapped opportunity that exists”.

“Research tells us that dynamic creative is shown to be more powerful, impactful and memorable. Part of the challenge has been that DOOH billboards are treated like static billboards, in that the message remains the same for the duration of the exposure time,” Dick says.

“The flexibility that DOOH offers around dynamic messaging definitely has value, OOH probably needs to demonstrate what value is being left on the table if it is not being considered.”

Zavecz says the conversation around dynamic OOH can be broken down into two sections, the creative element and the education piece.

He says the uptake and usage among clients still isn’t at the levels that QMS would like to see it. This isn’t just an issue with clients but also creative agencies, who he says still underutilise the full capabilities on offer, something he hopes will change as technology evolves.

“We’re a digital medium with the dynamic digital capabilities within the app, the same as any other digital mediums, but the uptake in out-of-home still hasn’t been as strong,” Zavecz says.

“We’ve had a platform probably for about three years now that has allowed clients to dynamically serve creative but still it’s usage is not where it needs to be.

“However that is just as much on us from an education and awareness standpoint, not just with clients but also creative agencies, around how easy it is and cost efficient it is now to be able to use these platforms to get more out of their messaging.”

Another piece to the puzzle surrounds regulation. While other countries have allowed moving and animatic dynamic creative to appear on screens, Australia still has restrictions around this.

O’Connor says Australia is considerably behind cities that have been a bit more progressive in allowing that moving advertising and believes if Australia were able to do that, it would certainly be “beneficial to the sector”.

“It’s not happening often enough in our mind. We’d really like to see people think about visual outdoor dynamically in the first instance. We use a phrase called 'dynamic overhaul' which is the first way that advertisers really think about using digital out-of-home. It’s going to grow,” he says.

“We’d like to be a bit further up the thought process. Maybe thought of a little bit earlier, and really try to do some creative things in the medium because the technology is now available to do that. That’s how we see it.” 

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