Digital conversion in Kerala OOH industry will take time: Experts
Industry experts believe cities in Kerala have not fully adapted to Digital OOH since there is still a strong preference for traditional OOH advertising
Out-of-Home Advertising or Outdoor Advertising remains one of the prime modes of advertisement in Kerala. According to industry experts, the OOH industry in the state is has a turnover of almost Rs 350-400 crore per year. Recently the state has banned flex materials made from polyvinyl chloride (PVC) citing health and environmental issues. As per the order from the Department of Local Self Government, PVC flex should not be printed or used for government functions, private or religious events, cinema promotion or advertising.
In the wake of this, is it high time that the OOH players in the state shifted to digital billboards? Unlike other South Indian cities such as Chennai, Bangalore and Hyderabad, the cities in Kerala have not adapted to DOOH.
We spoke to industry experts to get their take on the subject.
“It is probably a demand vs supply situation. The options for regular OOH formats are much more in demand and remain sold through the year so no one complains. A lot of advertisers today still believe in the traditional mediums like static OOH, unlike digital mediums. Also, many static OOH ads are large formats and hence lends visibility to the brands much easier. Digital OOH, on the other hand, may have deeper penetration and much better measurability and ROI but still, clients today in Kerala want OOH formats which are impactful and visible,” observes Venkata Varadarajan, Co-founder, CMO, Urban IQ.
“In many ways, the Kerala OOH business scenario is no different from those seen in non-Metro markets across the country. For one, the media ownership is highly fragmented, and as a result, their businesses are not scalable, whereas in the digital OOH (DOOH) environment the ROI will kick in only if the asset ownership is at scale,” said S Kumar, Managing Director, Srishti Communications.
Kumar continued, “It is also important to note that DOOH is a not a like-for-like replacement of the traditional OOH formats. The display part is only one aspect, which of course, meets the eye of the advertisers and consumers alike. Instead, DOOH calls for investments in software solutions, IT networking, hardware investments including their AMC, among others. Media owners who have been accustomed to investing in a few traditional units like hoardings and billboards will be hard placed to garner funds for investing in the tech-driven media for the longer term.”
So what stops the OOH players from shifting to digital formats?
“The existing OOH regulatory environment in Kerala is also not a great enabler of DOOH business. True, the state government has placed a ban on the use of PVC flex for advertising and publicity purposes, while mandating that the industry should switch to green options. But, there has been no policy measure to promote the use of DOOH in any of the markets in the state. Given that the norms governing digital OOH across the country are archaic, the media owners in Kerala will not have the confidence to even invest in DOOH assets in the fear that the authorities may come down heavily on the DOOH formats for some unforeseen reason in the future,” said Kumar.
“In order to shift to digital billboards, the government should be able to provide support and confidence to OOH players in Kerala. A few years ago, neon boards which were hosted in some part of Cochi city were removed citing that the public is getting distracted by the boards while driving. The hosting of digital billboards requires huge initial investments and if the aforementioned situation arises, then it will be a problem for the players,” said Biju Babu, a veteran in the OOH industry.
Talking about the challenges Krishna Kumar of Whisper Media said, “The initial investment required for digital billboards and its maintenance is a huge issue among the OOH players. Lack of awareness and proper professional guidance and maintenance is also a concern, and in terms of ROI, this might be another challenge. But we should be optimistic, the whole scenario will improve and gather a positive momentum very soon.”
According to Kumar, DOOH is growing in the transit media space, such as at the airports, Kochi Metro network, railway stations and the like.
“That is where DOOH will gain ground increasingly, and in time, as the city authorities deem fit to bring DOOH into the scheme of city beautification, we will hopefully see DOOH replacing the traditionally large and short formats in the outdoor space, unit by unit. DOOH adoption is also contingent on the cost of hardware and software solutions coming down,” added Kumar.
Talking about the digital conversion in the state Varadarajan said, “The digital conversion will take some more time in Kerala since traditional OOH has a very strong presence to the point of becoming a habit with advertisers to use them in their campaign strategies. And while the affluence and development are still on the rise, the market is largely traditional in the way media is consumed.”
He added, “OOH growth is very limited in Kerala and the chance to transition to Digital for upcoming locations is also limited. Only when the OOH media gets more regulated will there be a change in the way digital formats will find its way into the media spaces. And that will also happen with the overall cities and towns becoming smarter with their solutions for the general public.”.
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