Most forms of conventional advertising—print, radio and broadcast television—have been losing ground to online ads for years; billboards, dating back to the 1800s, are holding their own. Such out-of-home (OOH) advertising, as it is known, is expected to grow by 3.4% in 2018, and digital out-of-home (DOOH), which includes the LCD screens found in airports and shopping malls, by 16%. Such ads draw viewers’ attention from phones and cannot be skipped or blocked, unlike ads online.
Billboard owners are also making hay from the location data that are pouring off people’s smartphones. Information about their owners’ whereabouts and online browsing gets aggregated and anonymized by carriers and data vendors and sold to media owners. They then use these data to work out when different demographic groups— “business travelers”, say—walk by their ads. That knowledge is added to insights into traffic, weather, and other external data to produce highly relevant ads. DOOH providers can deliver ads for coffee when it is cold and fizzy drinks when it is warm. Billboards can be programmed to show ads for allergy medication when the air is full of pollen.
Such targeting works particularly well when it is accompanied by “programmatic” advertising methods, a term that describes the use of data to automate and improve ads. In the past year, billboard owners such as Clear Channel and JCDecaux have launched programmatic platforms, which allow brands and media buyers to select, purchase and place ads in minutes, rather than days or weeks. Industry boosters say outdoor ads will increasingly be bought like online ones, based on audience and views as well as location.
Data firms can tell advertisers how many people walk past individual advertisements at particular times of the day. Advertisers can estimate how many individuals exposed to an ad for a Louis Vuitton handbag then go on to visit a nearby shop (or website) and buy the product. Such metrics make outdoor ads more data-driven, automated and measurable, argues Michael Provenzano, co-founder of Vistar Media, an ad-tech firm in New York.
The outdoor-ad revolution is not problem-free. The collection of mobile-phone data raises privacy concerns. And criticisms of the online-ad business for being opaque, and occasionally fraudulent, may also be lobbed at the OOH business as it becomes bigger and more complex. The industry is ready to address such concerns, says Jean-Christophe Conti, chief executive of Viooh, a media-buying platform. One of the benefits of following the online-ad trailblazers, he notes, is learning from their blunders.
Editor’s Note: The Economist describes a sanguine future for the medium.