Are You Ready for the Surge in OOH Spending?

by Joshua Lawton, 5/3/18

The countdown has begun and digital marketers are rethinking their marketing strategies. From the Cambridge Analytica debacle to GDPR arriving on the scene in a month, the wells of consumer data are going to dry up of relevant data. No longer are these digital marketers going to be able to rely on apps that innocuously track consumers’ locations and then create natural person profiles that can be used for retargeting. The marketing and advertising landscapes are going to change significantly at the same time that marketing budgets are rising and CMOs are demanding relevant data to show their ROI.

This means that rather than continuing on its astounding upward market value creation, the $59B online marketing industry is going to contract and that money, searching for a place to find value, is going to go to the one market that does not rely on creating natural person profiles to validate ad spends: the Out of Home market. This shift in ad spends is going to have a significant impact on an industry that has a hyperlocal market and impacted by regulatory restrictions. When you combine these factors with the traditional real estate value creator of location, creating valuable new supply as demand increases is problematic. Furthermore, even with the expansion of digital out of home platforms, DOOH still only makes up 18% of the total OOH market spend.

Therefore, taking into account the previous effects of data on the digital market, what forecasting shows is that downward pressure is going to be exercised against the digital market while the OOH market’s value is going to be lifted by innovation in physical data that will provide relevance to advertisers and media buyers and create increased ad spending by them combined with the depreciating value of the data that the digital market contains.

In order to reap the rewards of an increased ad spend by media buyers and advertisers, OOH owners need to position themselves to not solely rely on location or weekly impressions, because national advertisers are going to have different ROI data requirements than local buyers. According to Darin Plautz of Waitt Outdoor, national buyers already want data that can help them determine “Which locations had higher demand and distribution throughout a region.” This demand for data that surpasses weekly impressions will only increase and trickle down to local buyers, which presents a problem for OOH owners because the tools that they rely on are not providing them with the data they need to increase revenue (something that we do at Abraxas Technology). A common complaint expressed by multiple individuals interviewed for this article was surmised by Andrew Greenwald of Gigantic Media, “Geopath and their tools don’t really make a good case for local buys.”

The one truth in business is if you stop evolving you die. Make sure that you have the data required to take part in the increased OOH spend that is to come and be around for the future.


Want to learn how Abraxas Technology can help you reap the rewards of an increasing OOH spend? Email Joshua Lawton is the COO and Co-Founder of Abraxas Technology.

Follow us on Twitter @Abraxas_Tech.