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The Writing On The Wall Got Bold
The billboards have begun to shimmer again, especially in the smaller cities, and the new year could see outdoor advertising recover a lot of lost ground
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Acknowledgement that the country was in the grips of a contagious virus led to a six-month-long lockdown. The streets were mostly deserted between March and September 2020 and traffic and movement on road or rail was restricted. The billboards along the highway and the hoardings over bus stop shelters gathered dust as manufacturers cut back on production and tightened their advertising budgets.
Out-of-home (OOH) advertising was probably the worst hit in the media and entertainment (M&E) space. The shift toward the work from home culture, channeled the already meagre advertising spend away from OOH and revenue earnings dried up for this segment.
If you give credence to the DAN Digital Report, OOH advertising was expected to grow by nine per cent in India in 2020. Advertising on billboards and other open spaces actually declined by 55 per cent in the first half of the year and closed at Rs 760 crore. The total advertising expenditure on OOH, traditionally known to grow by more than five per cent annually, demonstrated a de-growth of four per cent in the first half of 2020, going by the Pitch Madison Advertising Report Mid-Year Review 2020.
The hiccups in the OOH space persisted till July 2020. Now with ease in lockdown restrictions, content is beginning to pour in again, albeit in baby steps. The second half of 2020 brought some cheer to the sector because of a strong festive quarter that lingered till the end of Deepavali.
During this spell, outdoor media saw some serious consideration by the automobile industry, followed by the media and entertainment industry and then slowly the rest followed. Currently the OOH landscape is being most ardently patronised by all the traditional advertisers from real estate, the financial sector, the automobiles industry, the telecom industry, FMCG and retail.
"Covid-19 has forced advertisers to rethink, and the pandemic had led to an immediate drop in global advertising spend everywhere including India, where we had one of the toughest lockdowns in the world. The second half of 2020 has seen shoots of revival with multiple back-to-back festivals like Ganesh Chaturthi, Navratri and Diwali and as the world starts to understand and learn to deal with Covid-19," says Anant Jain, Director, Proactive In & Out Advertising.
Advent of Digital OOH
Indeed 2020 has been a roller coaster ride for the entire OOH ad space. Gulab Patil, Founder & CEO, Lemma, points out though, that 2020 was predicted to be the year when programmatic advertising would reach its tipping point and go mainstream - and so it did. "In the new normal, the accelerated adoption of digitised screens, the shift from screen to audience buying, creative flexibility with dynamic ads and many other aspects took centre stage, taking OOH advertising to a whole new level. If reports are to be believed, 2021 would be a road to recovery with substantial growth in the OOH industry, with major contribution estimated from the DOOH advertising spends," he emphasises.
Industry experts estimate that the digital out-of-home (DOOH) market could grow by 20 per cent to 25 per cent over the next five years, or more than double the rate at which the entire OOH market would be growing.
The Towns Shone More
Another interesting trend this year was OOH gathering momentum in the tier-2 and tier-3 cities and rural areas. With almost 70 per cent of the Indian population residing in these areas, brands see OOH advertisements as a via media to reach the larger population of India through big, impactful OOH properties in these regions.
"As advertiser budgets shrank and fewer people were traveling in the mega cities like Mumbai and Delhi, advertisers turned their attention to OOH in tier -2 and tier- 3 markets where the cost of advertising is significantly less. These markets have witnessed a boom in OOH spends in the second half of 2020. We expect this trend to reverse, but only very slightly, as normalcy returns and brands refocus their spends in their primary tier- 1 markets," says Jain.
The Year Ahead
With brands and markets on their road to normalcy in terms of operations, OOH revenue in FY 2021 is projected to add up to only about 50 per cent of that of FY2020. The industry is expected to only stabilise close to pre-pandemic levels in FY 2022. Also, brands who postponed their campaigns are expected to run them in FY 2022, supporting this recovery and may be joined by new entrants from health, education, technology and used automobile sectors.
"With almost complete unlocking at all the major touchpoints (airports, railways, malls, offices, restaurants etc.), OOH is able to provide a much wider spread than what we faced in these last seven months. This augurs well for 2021 with a buoyant market, a vaccine on the anvil and people returning to the said touchpoints. Out-of-home in traditional, digital and activation will touch near normal levels by the second quarter," says Dipankar Sanyal, CEO, Platinum Communications.
Another factor driving growth will be the OOH sector leverage technologies that help in quantifying advertisers' return on investment, determine audience composition and more precisely, target OOH advertisements. Patil is convinced that 2021 is going to be a year focused on finetuning OOH targeting further, using data and providing campaign measurement beyond the basic metrics.
"The stakeholders in the OOH space (especially programmatic DOOH) have introduced newer and more robust technology that classify, analyse, and convert data to help brands deliver more targeted and addressable DOOH campaigns with an added layer of dynamic ad rendering," he says.
Gautam Bhirani, Managing Director, Eyetalk Media Ventures also anticipates a glorious 2021 for the industry. "With things getting back to a level of normalcy and public places reopening, the adaptation of digital signage has grown considerably. With the kind of DOOH inventories coming up, the OOH industry will witness a big shift in investments coming in from digital channels, creating new opportunities to engage with audiences on the move in a pandemic induced new world," he says.
As a semblance of normalcy returns in the new year and bill boards and bus stops gleam and glimmer with new messaging again, OOH should shine again.