Author: Chris Signore, VP, Head of Sales at SpringServe, and Josh Cohen, Vice President of Sales & Client Success at SpringServe
Out-of-home ads (OOH) have been around since the dawn of civilization. They were inscribed on Egyptian obelisks and written on papyrus posters in China. Centuries later, as highways were built across America, so too were roadside billboards. Today, traditional OOH ads are being revolutionized by dynamic, digital screens.
Video-centric Digital Out of Home (DOOH) inventory is transforming content experiences in public spaces with crisp, engaging video that’s contextually relevant to the environment. DOOH video ads are reaching audiences in transit alongside buses, on airports, at gas stations, in elevators, ride-sharing cars, bars, restaurants, movie theaters, bowling alleys, and in any place people actively interact with their environment.
According to the Out of Home Advertising Association of America (OAAA), as a result of spending more time on outdoor pursuits, consumers are noticing OOH ads 45% more than pre-pandemic levels, making the channel more relevant than ever. In the US, DOOH inventory accounts for nearly a third of OOH. An increasing percentage of that inventory will be transacted programmatically, growing 14.8% this year.
Of course, executing a scaled DOOH campaign with targeting and performance tracking is no small feat. Ad-serving capabilities designed with display in mind aren’t necessarily equipped for video-centric DOOH.
Interestingly, video-centric DOOH media owners encounter many of the same challenges facing connected TV. In this way, as more DOOH video ads are traded programmatically, a CTV platform is uniquely positioned to solve for ad delivery and monetization issues.
Looking forward, programmatic is going to play a bigger role in DOOH. Here are some hurdles media owners face and how programmatic can help solve them.
Video-Centric DOOH’s Core Challenges
DOOH advertising has the power to drive brand awareness in a flexible, cost-effective way. Yet this fast-maturing medium is not without growing pains.
Similar to CTV, competitive separation is something for video-centric DOOH media owners to be particularly aware of. Not only do they have to account for competitive ads in the same block, but DOOH servers must also account for the physical ad-serving environment. For example, it would be counterproductive to serve a Burger King ad on a digital screen outside Mcdonald’s.
Likewise, just as a brand may not want their ad running on a site with low-quality content, certain brands may not want their ads served outside liquor stores or casinos. Fortunately, with the right tech, rules can be set to automatically meet those delivery needs, ensuring ads are contextually relevant.
Along the same lines, DOOH ads require creative review to minimize poor ad quality, i.e., the ad volume may be too high relative to the environment, which can be disruptive. With the right tech, brands and DOOH media owners can optimize ad quality with the environment in mind.
In DOOH, media owners also face nuanced needs regarding performance and measurement. Imagine a DOOH screen in an Uber that drives from Manhattan to Hoboken. With geo-targeting and reporting, does that ad view count as reaching a New Yorker or New Jerseyan?
Also, how do DOOH media owners benchmark video ad performance? If an ad was served to a packed sports bar with 50+ patrons, common sense tells us the “reach” is not one, but 50. However, many video-centric DOOH suppliers aren’t getting paid on that multiplier number.
Here, there is growing sophistication around methodologies for measuring how many viewers are present, such as determining how many Bluetooth-enabled devices are within range of the hardware displaying the ad. True DOOH advertisers are paying on that multiplier (total reach), whereas this kind of measurement isn’t yet available in CTV.
Despite these challenges, the upshot is that video-centric DOOH inventory is adopting the standardization of CTV, as well as best practices for DOOH delivery with tech tailored specifically for DOOH environments. As the somewhat nascent channel continues to mature, it will mean more seamless ad delivery, and improved measurement and monetization.
The DOOH Opportunity
DOOH has the potential to drive collective viewing experiences and peer-to-peer marketing that private viewing cannot. Programmatic DOOH uses real-time data and leverages AI to serve ads to relevant audiences. Consequently, it can be interactive with its ad creative.
For example, dynamic DOOH ads can comment on the weather, traffic conditions, or the outcomes of a big game. This can make the ad experience more immersive and memorable for audiences.
Meanwhile, flexible programmatic DOOH pricing models enable brands to increase or decrease ad spend in-flight, modify campaign parameters, or cease a campaign altogether when necessary. With private marketplaces and tailored DOOH deals, DOOH can be seamlessly added to a cross-channel campaign.
The Future of DOOH
As video supply continues to consolidate and become less fractured, programmatic DOOH is fast becoming a truly viable channel with its own tech stack, delivery, and measurement frameworks for brands and media owners. With the global DOOH advertising market set to hit $21.35 billion by 2030, growing by 13.0% annually, more video publishers and media owners are looking to capitalize on the opportunity.