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OOH agencies cautiously optimistic about 2014

09-January-2014
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OOH agencies cautiously optimistic about 2014

Even as digital marketing continues to occupy an ever increasing portion of the ad revenue pie, traditional media such as print, outdoor and radio are being constantly challenged to innovate and stay more relevant with changing client expectations and consumer preferences. With a less than stellar performance in the past two years, the OOH industry is hoping for a much better 2014 as elections loom and new infrastructure projects in metros create more inventory possibilities. Let’s take a look at some key trends that agencies foresee in 2014.

General elections will provide a boost
We have already seen what a great impact the State Assembly elections had on the OOH sector and it is safe to assume that 2014 will see an even greater spend on the outdoor medium by political parties. Since most cities have banned posters, outdoor remains the only viable option available for propaganda, along with radio as both are cost-effective and have reach. “All national parties such as BJP, Congress, and NCP are geared for outdoor campaigns. Beside this, outdoor industry will also get benefit due to its extensive reach in rural areas and tier cities,” said Sanjeev Gupta, MD, Global Advertisers.

Another beneficiary of this could be transit media, which has shown impressive growth in the last two years. “Transit media will continue to show tremendous growth in 2014,” said Sunder Hemrajani, Managing Director, Times Innovative Media, pointing out that it was one of the most popular choices for political parties during the 2013 State Assembly elections too.

One key change in 2013 was the strategic approach to outdoor advertising that was undertaken by political parties. From performance tracking of advertisements to a more targeted approach towards hoarding placements, this shift in the mindset will definitely be more noticeable in 2014 and will keep agencies on their toes.

Ad cap might benefit OOH
TRAI’s decision to impose a 12-minute ad cap on TV channels has the broadcasting industry in an uproar. However, other media such as radio and OOH have been the clear beneficiaries of this decision as brands have started looking at other media for advertising. If TRAI remains adamant on its decision, then we could see more brands to continue exploring the OOH medium for their marketing initiatives in 2014.

However, there is a flip side to this that needs to be considered. According to Rajiv Saxena, MD, Blue Ocean Media, it could just happen that brands might end up diverting their funds from other media to TV if TV channels raise their ad rates. When the ad cap issue first came out in March 2013, it was mass reach media like radio and OOH that gained the most. Will this continue in 2014? We will have to wait and watch.

Brand expectations will change
The year 2013 saw a shift in brand strategy with emphasis on cross promotions and experiential and engagement activities. More and more brands are looking for value from their outdoor investments, in terms of innovation and engagement, rather than just reach. It will be interesting to see how OOH agencies adapt to this changing mindset. With digital marketing continuing its explosive growth, traditional media such as OOH will have to come up with ways to integrate their campaigns with mobile and digital platforms and we could see some movement in this area in 2014.

“There is an evident trend in media investment with a focus on ROI, especially in smaller cities. Brands have shifted focus to a 360-degree integration; through cross promotions, experiential and engagement activities. We have already seen a few disruptive innovations deployed via campaigns with smaller investments in 2013,” opined Nabendu Bhattacharyya, Founder & Managing Director, Milestone Brandcom. The days of the traditional outdoor hoardings are fading with brands wanting strategic placements that better reach out to their target audience, which is another reason why transit media has been doing so well in recent years.

So, is 2014 going to be a happy year for OOH?
The general feeling in the industry seems to be that 2014 will be a much better year than 2013 with some, like Gupta, even predicting a 15-plus per cent growth rate. Another reason for this optimism is the number of new infrastructure projects in metros such as Mumbai and Delhi. Hemrajani remarked, “We have new metros and airport properties being developed, which will boost the economy and provide more opportunities for inventory placement.” However, OOH players must not get too carried away. One of the key reasons for the optimism in this segment is the Lok Sabha elections, which most expect to lead to a great first half, but what happens after that? There are many issues within the OOH segment that need to be addressed – the fragmented nature of the industry, the lack of metrics, being chief among them. To stay relevant in the rapidly changing marketing landscape, the OOH industry will need to think about these factors and not rest on the laurels of one good year.

 

Kranti Gada joined the family business at Shemaroo in 2006 after a successful stint of over two years in marketing at Pepsi Co. She has been associated with the company for 12 years.

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