Digital out-of-home is any screen you see in in-store networks at your grocery, taxis, movie theaters and other settings. Since 2007, the Out-of-Home Video Advertising Bureau (OVAB) has been leading the industry's initiative to create measurement standards and practices for advertisers and agencies to measure these outdoor-video networks the same way they would other media, including TV. PQ Media recently pegged the sector's size in 2009 at $1.91 billion, a 3.2% gain from 2008, while
Veronis Suhler Stevenson has valued the industry at $2.5 billion after cinema advertising and digital billboards are factored in.
Who are the major players?
National CineMedia and Screenvision, the two leading cinema-advertising companies, essentially lead the pack in terms of market share and distribution, selling in-cinema ads for everyone from AMC to Regal to New York's Clearview Cinemas. A recent crop of mergers and acquisitions in 2009 has brought more attention to companies such as Zoom Media, which represents a leading network of health clubs and bars; Captivate, the elevator and office-based media network; and RMG Networks, which recently combined health-club network Ideacast with bar-and-coffee shop group Danoo. IndoorDirect's Restaurant Entertainment Network has become a dominant presence in the fast-food and casual-dining space, booking in-store programming deals with Wendy's, Arby's, Denny's, Hardee's and select McDonald's locations. NBC Everywhere has also emerged as a growing, regional player in the New York market, hyper-targeting commuters on taxis, New Jersey transit platforms and other place-based locations. Clear Channel Outdoor is also getting more into the new-media game by turning its Times Square digital billboards into movie screens for studios like Sony, Fox and MGM.
Who's buying it?
Lots of entertainment marketers, who are using the place-based networks to run longer versions of their movie trailers and TV promos. But increasingly, financial-services marketers such as Chase and American Express are turning to transit and retail locations to get their branding messages in front of consumers while they're shopping, and pharmaceutical companies such as Schering-Plough and Pfizer are turning to the medium for more integrated takes on their 30-second spots. Schering-Plough executed one of the industry's biggest dedicated buys last year when it shifted $10 million of its TV budget into digital out-of-home to promote brands such as Claritin and Dr. Scholl's. Posterscope, Aegis Media's out-of-home buying group, recently merged with Havas' Chrysalis for a first-of-its-kind buying and planning partnership to combine traditional and digital out-of-home groups. WPP's Kinetic has also consolidated its digital buying and planning for agencies such as Mediacom, Mediaedge and Mindshare. OVAB President Suzanne Alecia expects the organization to roll out an online planning tool in the coming months for advertisers and agencies to create a one-stop shop for advertisers and agencies interested in buying across OVAB's member companies.
What trends are on the horizon for 2010?
Expect more mergers and acquisitions in the first two quarters, as well as integration of mobile and social media. Ashton Kutcher turned to digital billboards last year for his Twitter contest with CNN, and quickly logged 1 million followers after local markets lit up their boards with "follow @aplusk" messaging. On the vendor front, some of the fastest-growing digital out-of-home companies are based in retail and mall locations, such as Access 360/OnSpot and CBS Outdoor/GameStop, where movie, video game and package-goods marketers are running rampant with text-message coupons and wireless apps to sell products. The advent of 3-D in cinemas and in-home entertainment has also trickled into out-of-home as CBS and Monster Media develop technology to bring 3-D content and advertising to transit locations, often with no 3-D glasses required. Ray Rotolo, chief operating officer of Posterscope, is also anticipating an influx of pharmaceutical spending as Big Pharma continues to find ways to market around its regulatory hurtles in newer, targeted ways. "They'll continue to come to digital out-of-home because of what the engagement factors are with mobile and social media," he said.