OOH industry confident of a better recovery trajectory post lockdown 2.0
Despite an approximate 50% degrowth in the industry this year, the industry is hopeful of reaching pre-covid levels of revenue since it was quicker on its feet this time around
The second lockdown imposed by the Maharashtra government in April has dealt a blow to the OOH and DOOH ecosystem, which was still grappling with last year's economic losses. The out of home industry was on its path to recovery during the festive season. But all is not bleak, according to OOH leaders.
This time around, the out of home markets and brands predict a promising pipeline and recovery patterns.
e4m spoke to OOH and DOOH experts to get their perspective on how the industry was derailed during the second lockdown and how they plan to tackle the setback.
According to Jayesh Yagnik, CEO, MOMS Outdoor Media Solutions, the overall industry foresees a healthy recovery as compared to June 2020.
He explains: "Last year, this period was a more metro phenomenon. However, this year, it has affected the small-town businesses as well. The industry has already experienced lockdowns last year. Hence, we were more informed and quicker on our feet to look at different options and integrations for our clients and the road to recovery will be much faster."
Yagnik says that just like last year, there’s hope to recover the drop in the latter part of the year. “Revenues in the months of April and May have been affected due to slower business. However, we would prefer not to look at the revenue for two months, but take it at an overall yearly level as this is a situation out of anyone’s control. The primary idea is to be partners with clients and our people in these times. There is a healthy pipeline and recovery patterns across markets look promising.”
Gulab Patil, Founder, CEO, Lemma, remarked, “The impact of the second lockdown has certainly affected the DOOH industry in more than one way, despite the agility and flexibility it offers. The restricted movement of audiences shook the confidence of the advertisers in reaching the masses via DOOH. This situation, however, is now getting better as stakeholders, like ourselves are regaining the confidence of buyers through our data and technology-enabled DOOH screens across the country. To focus on some positive impact, I’d say the industry has utilized this time to upgrade to better technology and solutions. We’ve also onboarded several new screens onto our programmatic network using this time to set up and test new media.”
On asked about the percentage of revenue that got affected in the second lockdown, he said, “It has affected a lot, around 80% of campaigns are on hold because of this second wave.”
Amarjeet Singh, COO, Laqshya Solutions also weighs in, “The second wave of the Covid pandemic, since April 2021, disrupted the industry yet again after a wonderful restart post the first lockdown. Learning from the challenges of lockdown for over a year, the OOH industry has also reinvented itself. We at Laqshya are continuously working on developing our relationships with our clients and building on new and existing technologies.
"The industry, led by the large players, has already got several campaigns in the pipeline. Having said that, we expect that it will take another 2-3 months before we are back to the level that we achieved in early 2021. Traffic across several cities is almost back to normal, presenting the clients with the opportunity of reaching a high-quality audience.”
Elaborating on the revenue affected during the second wave, Singh adds, “Since April 2021, the business has declined by 50-60%. This recent setback could shave off about 20% of the industry’s revenue in 2021. According to the FICCI-EY Media & Entertainment Report 2021, OOH in 2020 also faced a de-growth of approximately 50%. The industry earned revenue of Rs 1,560 crores in 2020 and the report estimated that the industry will return to its pre-Covid level in the next two years. In 2021, marketers are expected to spend about Rs 2,160 crore on OOH advertising.
"In 2019, the industry was worth as much as Rs 3,910 crore. We expect a higher trajectory of return to normal and foresee reaching pre-Covid numbers faster. We have the data and are conducting extensive research to ensure that brand managers appreciate the unique qualities of OOH and DOOH and actually increase their allocation of advertising spends to this medium.
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