Marketing & Communications

Covid-19 – a tough test for the outdoor

The long-awaited Outdoor Track study was supposed to bring order to the OOH market by providing reliable data on the audience and measurable parameters of OOH media.  However, the differences between the assumptions and visions of the OOH market and the reality are quickly bringing us down to earth.

What seemed negligible in the pre-covid era and was of interest only to the most inquisitive marketers, namely the validity of data, nowadays lies at the heart of the Outdoor Track study and the Out-Of-Home sales model. 

The survey has created a model that is intended to be regularly fed with traffic data, but the evident decline in that traffic has not updated the inventory potential of suppliers.  On its website the Outdoor Research Institute boasts about its ability to re-model the data in real time, e.g. in the case of bridge closures or new road construction.  We can assume that the IBO’s computational potential has been harnessed to the post-covid recalculation of media audiences, but unfortunately the news does not reach the end of the chain (i.e. the agencies and clients).  And I don’t think anyone doubts the reduced traffic in cities and the resulting smaller audience.

On a year-over-year basis, the decrease in traffic was not very large – agreed.  December data from AMS Traffic Flow Data shows an average decline of 8% in September-October 2020 compared to the same period in 2019.  However, the lockdown of both spring and autumn/winter has caused Media Agencies and advertisers to persistently ask the obvious question: why, when selling the number of contacts, do you not reduce the price of the carrier, if this audience has decreased and this is visible to the naked eye?

 The pandemic reality, and the panic among advertisers – often clearly exaggerated, by the way – meant that the OOH market had to react.  But vendors are still clinging to the numbers assigned to each of the examined media.  Numbers from a few years ago, I might add.

Paulina Kapica, Trading Specialist Publicis Groupe

The current situation is not helped by the Outdoor Research Institute itself.  The Institute was supposed to be the sole owner and to share data with the market.  However, the reality is that the suppliers’ use data of different origin.  What’s worse, they use this data selectively and in a manner beneficial only to a given supplier.  The result is an atmosphere of general chaos and mutual undermining of the value of competition carriers.  There is no other way to describe the situation, in which the same reality leads to completely different conclusions resulting from the reports of individual suppliers.  This certainly has a demotivating effect on the image of OOH in the eyes of potential advertisers.  And the reality is that the solution, dynamic as it was supposed to be, turned out to be an inert colossus, a laboriously worked out compromise that no one wants to violate by shouting “the king is naked!”.

The IBO is currently facing the important task of standardizing data and becoming its objective source. The OOH market needs consolidation and IBO can play a leading role here.

The question remains, is the OOH market able to react instantly in such a dynamically changing environment?  Not really. OOH ad impression cycles are basically fixed, bonding takes time, posters need to be printed and transported beforehand.  This and many other factors contribute to the considerable inertia of this medium. The pandemic has only highlighted the inadequacies of the sales model as it stands today.

But the aforementioned printing, transporting, gluing and constant emission cycles helped us to see an unexpected beneficiary of the pandemic turmoil… the DOOH market growing with each passing month!  This is because digital media are devoid of all of the above characteristics affecting the inertia of the medium.  Campaigns can be activated practically in real time, cancelled instantly, content can be adjusted to the current situation, and all this without the risk of incurring technical costs. Last year’s practice confirmed the theoretical advantages of digital media. Admittedly, the dynamics of spending fell relative to 2019, which from today’s point of view should not be surprising, but the share of DOOH in the entire outdoor market in the three quarters of 2020 grew to 15% from 11% in the corresponding period of 2019.

But going back to analogue OOH, another question arises: how to deal with an exceptional situation like the one we are currently in?  After all, not everyone can afford to risk running an outdoor campaign in a deserted city.  Undoubtedly, the ball is in the suppliers’ court. Their flexibility, and therefore their attractiveness from the advertiser’s point of view, depends directly on certain concessions that the OOH market will have to make to some extent.  The alternative is to wait out the pandemic and the next few years, during which advertisers will forget about lockdowns… but I don’t think any company can survive such a wait.

Perhaps some solution would be to draw on the experience of radio professionals.  Radio planning is based on regular surveys.  And no one is impressed by the fact that the actual listenership can be counted only after the fact.  On the day of planning the campaign, the audience in a given wave of the survey is this and this amount, and on this basis the campaign is planned in this way and not in any other way. And the fact that the listenership during the active campaign is actually slightly different?  This is a risk that is inherent in this type of media planning and buying. BUT, listenership research is conducted regularly and the market is on to something.  And this is not about whether a given station is listened to one hundred percent as the study shows, nor about whether a given medium will be seen by exactly 8,754 people, because it is simply impossible to measure something like that.  The point is the basic assumption that there is data – of better or worse quality – and that the whole market agrees that this data will be the basis for the functioning of this market.  What’s more, the outdoor suppliers have this data. They assure us that there is little decline in traffic based on GPS data.  And this data is current. So why can’t this data be used to model media pricing?  Wouldn’t that just be fair?  Data changes – the market changes.  Both on the plus side and on the minus side. Just an ordinary business swing.

Now imagine a radio study from four years ago and today’s trading of advertising time… but according to listenership at the time.  It is easy to bet dollars to nuts that there would be broadcasters who would be exceptionally fond of such an idea.

The OOH market was unlucky in introducing the new model of media sales basically just before the pandemic. Not only did advertisers not have time to get used to it, but the cataclysm that hit us was expressed by reduced traffic on the streets and undermined confidence in the solution that had been developed for years. On the other hand, thanks to Outdoor Track research and its measurable results, it will be possible to use specific figures to defend OOH in media plans.  However, it is worth taking care of the validity of the data expressed, among others, in the form of adequately variable prices of media.

We should wish the outdoor advertisers as well as everyone else, a quick return to normality, as well as the development of forms of flexibility allowing advertisers to invest in outdoor advertising in a safer way.  What is at stake now is rebuilding the position of OOH through, on the one hand, high commercial flexibility and clear, precise criteria for cancellation or transfer of campaigns and the associated costs.  Traders and lawyers, time to get to work! 

The good news is that spring is coming (and with it increased out-of-home traffic) and let’s hope for the best!