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Beyond Billboards: How Digital Out-of-Home Continues to Innovate

Since as far back as the 1830s, billboards have been a foundational part of America’s advertising landscape. Entrepreneur Jared Bell first began printing large-format circus posters along the streets of pre-Civil War New York to advertise the local Ringling Bros. circus, but almost 200 years later the humble billboard has been supplanted by a technology-forward roster of digital advertising formats. In particular, programmatic digital out-of-home (DOOH) ads have changed the ways that companies introduce themselves to potential customers, shifting the perspectives of consumers around the world and leveraging emerging technology to give advertisers all the tools they need to stand out.

To consumers, these ads are passive experiences that weave themselves almost seamlessly into the fabric of everyday life. For advertisers, however, the leap from traditional to digital has forced them to rethink the ways that they purchase advertising space. Like any tectonic shift, the advent of programmatic DOOH ads has required advertisers to stand precariously at the edge of technological progress to best leverage the ever-changing nature of ad messaging and evolve their tactics alongside the medium.

Still, digital marketers and their clients would be remiss to pass up the opportunities that programmatic ad buys provide, which now includes out-of-home advertising. To overcome the programmatic ad learning curve and stay at the forefront of digital marketing trends, companies need to seriously consider how their existing ad purchasing practices need to be adjusted without losing sight of their own brand identity. Read on to learn about how programmatic ad buys present unique opportunities for advertisers.

 

The Road to Programmatic Out-of-Home Ads

Buying ad space has come a long way since the 1830s, with no technological leap more pronounced than the rise of digital media.

Contemporary advertisers are no doubt familiar with Display ads, the cornerstone of most internet users’ ad viewing experience. A cornerstone of the early days of the internet, the first Display ad appeared to 1994 internet users as an AT&T banner ad resting at the top of HotWired.com. From there, Display ads became commonplace across the developing web.

For advertisers, the ad buying process for these types of ads was straightforward: pick the location that you’d like to buy ad space on and determine your pricing structure (Cost-per-click [CPC], cost-per-thousand impression [CPM], or cost-per-action [CPA]). The ad buying process itself is manually negotiated, requiring two parties to agree on the placement, frequency and modality of the ads in question.

Then, in 2013, along came Programmatic ads. Google’s AdSense program, referred to as “content targeting advertising” in its original 2003 iteration, generated revenue for each click generated from page impressions and leveraged automated processes to place ads in front of specific audiences without manual intervention. The automated or “programmatic” processes that allowed advertisers to manage their digital ad campaigns more efficiently was key to streamlining the ad buying process across the entire marketing industry.

Recently, programmatic ads have evolved into sophisticated but sleek tools that afford advertisers a level of convenience and control that was previously unavailable through standard display ad buying methods. Programmatic ads have seen a drastic rise in popularity as consumers adjust their buying behaviors.

 

The Programmatic Advantage

Programmatic ads aren’t limited to desktop and mobile web browsing; these days, advertisers utilize programmatic ad buys to place their advertisements in gas station TV screens, movie theaters, and rideshare screens, to name a few. Advertisers no longer need to limit themselves to an audience of one with these new mass media offerings.

Fortunately for advertisers, the ability to buy DOOH ads is more streamlined due to the ability to manage DOOH placements in the same platforms as programmatic display ads, alongside many of the same audience targeting criteria commonly available for display ads. In essence, managing programmatic ads should feel like a simplified version of management for display ads.

To this point, programmatic DOOH campaigns can be applied in ways that remove the legwork from most traditional OOH campaigns. For example, advertisers can have their campaigns programmatically utilize radius targeting to advertise products in or near specific events. Programmatic DOOH campaigns in the near future can also “ping” passing commuters to compile data for future campaign adjustments.

This underscores the attributional value of DOOH campaigns, where individual ads can create a halo of influence around similar campaigns and create new sets of shared consumer-based information to pull from. This sort of data collection has not been possible for previous OOH efforts, where the link between efforts and results is much more ambiguous.

Like many industries, out-of-home ad buys took a hit during the pandemic as consumers stayed indoors and spent less. Fortunately, recent information from Insider Intelligence indicates that this slump is on the downswing. By the end of 2023, DOOH spending will regain its pre-pandemic share of total outdoor ad dollars at 31.4%. This presents advertisers with new opportunities that allow them to reach wider audiences and leverage more robust technological formats without getting caught in the weeds of manual ad management.

 

An Out-of-Home Opportunity

Still, advertisers seem hesitant to adopt DOOH ads even in the midst of a post-pandemic resurgence. Whether it comes down to budgeting, ROI concerns or the seemingly opaque nature of DOOH as an emerging channel, the majority of advertisers have not flocked to DOOH with the same frequency as more traditional campaign types. Insider Intelligence predicts that fewer than one-tenth of OOH ad dollars will reach consumers programmatically in 2023, an alarmingly small fraction considering that Digital Journal estimates that DOOH spending will reach at least $55 billion by 2026.

Nonetheless, the DOOH learning curve isn’t as steep as it first appears, and the ROI benefits can be staggering if properly applied. According to Xaxis’ The DOOH Difference 2022 Report, 77% of consumers describe DOOH ads as “very” or “quite” informative and half of all surveyed consumers say that DOOH ads encouraged them to make purchases right there and then.

“While the adoption of DOOH is growing, it is still a large opportunity for many brands who have not immediately embraced DOOH as part of their marketing mix,” says David Sutton, Lever’s SVP, Growth. “The ability to buy outdoor ad space programmatically and with the same considerations toward targeting, performance, and ultimately metrics paired with low adoption rates tells me there is still a misunderstanding on the benefits this medium provides. It’s our job as advertisers to fix that.”

With the DOOH market still far from oversaturation, now is the time for brands to step in and capitalize on the available space. Programmatic DOOH campaigns present an emerging opportunity to make a significant impact and gain a competitive edge without the risk of overextending staff and resources.

 

Conclusion

Current trends indicate that DOOH ad campaigns will become the standard for display buys in the near future, eclipsing traditional out-of-home marketing  as advertising technology continues to improve.

Don’t let DOOH ads remain a missed opportunity. Dive into DOOH and make use of programmatic advertising before it becomes as popular as we know it will be.

If you want to learn more about how your marketing mix would benefit from DOOH, reach out to us at leverinteractive.com/contact.

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