Monday, March 3. 2008
First, the excitement building around the opportunities in the digital out-of-home media space was palpable in Las Vegas last week. The sheer enormity of new technology presented on the trade show floor was evidence of that, and change is coming fast, as in just a couple years we've gone from new at-road digital billboards to touchscreen technology in bars & restuarants to wave technology in various retail and transit locations. Another key trend: big technology companies have jumped into the sector full force, from Samsung and Sony to Microsoft and Cisco. The excitement also has not been deterred by a slowing economy for several reasons, chief among them being that digital OOH advertising is becoming a last-mile, point-of-purchase sales tool for products, ostensibly placing it in the lead gen category - as opposed to the branding category - during an economic downturn. What's more, major brands are pressuring their agencies to take a closer look at the digital OOH sector, particularly the new platforms reaching increasingly elusive consumers in retail outlets, transit hubs, offices, entertainment venues and theaters. These are some of the key drivers behind PQ Media's exclusive digital OOH media research, which forecasts double-digit growth in the digital OOH segment over the next several years. However, another key assumption behind our forecast (see "Alternative Out-of-Home Media Forecast 2007-11 in the research section of this site), was that this industry would address the challenge it faces with respect to demand from brands, and particularly their agencies, for more and better research, data and measurement on the effectiveness of DOOH advertising. This will be key to the sector's growth going forward and, in my opinion, one speaker did a fantastic job of pointing out this reality during a session last Wednesday.
During a session titled "OOH Research Results - New Insights and Trends," Jack Sullivan, SVP/OOH media director @ Starcom Worldwide, offered a poignant and honest perspective on the struggle this emerging industry faces in relation to the brand-agency-media relationship that has existed for decades. In short, this industry, like other alternative media platforms, is up against entrenched business models and relationships that favor traditional media, particualrly broadcast TV, when it comes to allocating dollars toward a media mix.
In his own words, Jack said: "Be patient with us agencies. We've been in traditional media for a long time. Our whole model is based on old media, and broadcast TV in particular. But our clients are demanding changes. It's not happening as fast as you would like, but I believe the tipping point is very near."
To this, one audience member replied with the query: "Why should we be patient with the agencies? Why don't we just bypass the agencies and go directly to the brands?" To which Jack replied: "It's likely that the agency is going to be at the table one way or the other, so you may not want to damage an agency relationship in your drive to reach the brand with your message. So, I don't know how patient you should be, but be patient. Clients are looking for escape plans from broadcast TV, but they need more info. And this industry still has fragmented research and lacks standard metrics."
Bravo to Jack for this response. His sentiments were echoed later during another session when a digital OOH media company rep asked panelists how important standards, metrics and new research technology, such as eye dwell, eye gaze and other engagement tools, were to the future of the industry. To a person they said very important.
Now, I put these questions to you: How important are standard metrics, new engagement tools and a strategy for pitching agencies and brands on the opportunities afforded by digital OOH media? How long will it take agencies to break out of their traditional mass media mentality and begin to shift large swaths of ad dollars toward digtial OOH and other new media, besides Internet display and search? How important will it be for digitial OOH networks to offer clustering options to advertisers going forward? Let me know your thoughts on these and other issues you believe are important to the future of the alternative OOH media sector. I look forward to hearing from you.