How best to source outdoor advertising during Olympics and other sporting events?

By Imran Firoz, Senior Research Analyst - Marketing Services

The demand for out of home (OOH) display usually goes up during a mega sporting event like Olympics.

Advantages of OOH Media

• Mobility of customers
• Cost effective media for advertising -- lower cost per thousand audiences.
• OOH helps in reinforcement of advertisements placed in other medium such as television or online.

Amplification of message

• High ROI and Low Cost: OOH as a part of media mix or as a standalone medium has the highest return on investment on advertising and has the lowest cost per audience. The ad presented through OOH medium has a greater appeal. An OOH billboard, for example, cannot be turned off or omitted by the target audience.

Connection to the audience

• OOH helps marketers to connect with customers by providing two way communication using QR codes and mobile coupon.

Real-time consumption

• OOH media helps marketers to be more creative in terms of grabbing the attention of target audience.
• OOH is the only media, which appeals to the people when they are out purchasing.
• OOH integration with mobile helps marketers to transact with target audience at any point of time during various stages of decision making.

OOH Landscape in Brazil

• Brazil ad spend: Advertising spend and media consumption in Brazil is expected to be strong during Olympics.
• OOH space and government investment: The Brazilian government has already invested billions in infrastructure. Expansion of international airport and other transport facilities will create huge space for OOH, which marketers would leverage.
• Digital OOH Vs. traditional OOH: The digital out of home spend is expected to exceed the traditional OOH -- this is due to technological advancement in the supply base. Digital solution providers such as Planar and Scala are continuously launching innovative display solutions like LED video walls, LCD displays and interactive touch displays. Marketers are opting for interactive content and placement of DOOH in key locations with huge footfalls.

Source: latinlink.usmediaconsulting.com            Source:http://www.brasilsignage.com.br/en

Supplier Landscape
 

• OOH services in Brazil are provided by agencies with varying levels of geographic and channel coverage. There are specialist agencies by format -- for example Outernet is a specialist agency providing transit based solution whereas JCHEBLY specializes in Airport based digital displays.
• The supply market is dominated by leading network agencies like JWT Brazil (WPP) and DPZ (Publicis). These network agencies also use specialist agencies as subcontractors -- for example Altermark provides OOH services to Publicis group in Brazil.
• Independent regional and local agencies like “Innova all around the world” are engaged by some of the major CPG clients in Brazil due to their focus on regional campaigns. Specialized local agencies have a strong local presence and are more cultural savvy.

Key Take-away: Marketers should adopt a model where out of home spend is routed through one of the top network agencies, who will centrally manage the entire advertising campaign including the OOH, as this media forms only 3-6% of the total ad budget. Consolidating OOH with other traditional media will help marketers to negotiate a bigger account with the supplier. At the same time, specialized local agencies can be used for specific channels like airport-based digital displays.
 

ROI measurement technique for Out Of Home Advertising - Primitive vs. Modern

With the advent of new techniques to measure ROI, marketers are expected to gain more confidence while investing in OOH media. Eye on Impression technique for measuring the return on investment will bring OOH on par with other traditional media like Television; this will help marketers to evaluate the entire campaign effective

Digital trends to look for during Olympics

Digital trends such as geo location can help marketers to place more targeted advertising: digital technology helps in targeting customers within a certain range or location. Trends like dynamic content on digital OOH formats (like digital clock) may help marketers to display their message with variable data such as time of the day and climate condition.

Key challenges

1) Rise in OOH space rent to property owner: OOH space rent has the highest share in the cost structure. 38-47% is generally paid by the agencies to the vendor/property owner for spots in prime location, and this is expected to increase during large sporting events such as Olympics (43-53%).

2) Maintenance of OOH formats: Maintenance of billboards and other formats of OOH constitutes up to 10% of the total cost structure. This is expected to increase by 1% this year owing to the expected rise in the upkeep of various formats such as billboards, digital wall and displays in areas with high foot fall. The digital clocks on the beach areas would require regular cleaning to avoid unclear message.

Conclusion

Among several challenges, marketers in the CPG sector may look for various opportunities to effectively manage OOH spend during a large sporting event like Olympics. Center-led strategy for sourcing OOH display is mostly adopted by marketers in Brazil. However, a slightly decentralized approach may help develop a local media strategy, and optimum planning and placement of OOH media, considering the high cultural and language disparity in Brazil. A shift to medium term contract between 1-3 years along with the rate-contract may help marketers to save on expected rise in price of OOH space during mega sporting events. Marketers in the CPG sector can also channelize a part of the OOH spend in alternatives like athletes/sports sponsorship.