The Future of Out of Home

In an evolving media landscape full of cord-cutters and video streamers, advertisers are always trying to find new ways to get their client’s messages in front of consumers. While Netflix and internet radio may be battling for impressions from their traditional media counterparts, out-of-home (OOH) remains a somewhat neglected vehicle. But major developments over the past few years are proving that shouldn’t be the case.

While OOH has never held the majority of spend, outdoor advertising is forecasted to hold its share of total ad spend through 2019, according to Ad Age. It has remained a reliable and constant vehicle for advertisers for years, providing a complementary layer to any campaign. However, with the benefits of web-based digital advertising now in plain view, OOH is being challenged to evolve and demonstrate a heightened level of sophistication in order to remain relevant and enticing to brands.

The good news for all is that advancements in OOH have risen to, and in many cases, exceeded marketers’ elevated expectations. This is being driven primarily by the increased availability and technological capabilities of digital screen installations, paired with companion technology such as beacons, geofencing and on-site payment systems. A steady rise in the amount of real-time OOH inventory seen on demand-side platforms is also helping marketers tap into audiences in new ways. These upgrades have many now considering OOH to be one of the most critical pieces to an engaging campaign in today’s cluttered media ecosystem.

New and dynamic capabilities

One of the biggest issues outdoor advertising faced over the years was its somewhat lackluster ability to gauge true effectiveness. Advertisers could be certain of some basic elements such as location and size of ads, average foot or vehicular traffic and basic demographics.  But beyond those facts, looming uncertainties still remained: Did the message actually reach a client’s intended audience? How many consumers have viewed this ad during the campaign? Is the location ultimately ideal for the brand?

With new systems being built into digital displays, solutions to these questions are appearing in a multitude of ways. One of the most common comes in the form of digital beacon technology. Clear Channel led the charge here by launching “RADAR,” a data and analytics tool that delivers measurable information from OOH campaigns to advertisers. These “smart boards” use beacons to collect non-personally-identifiable data from nearby mobile devices. They can then utilize that information to sort viewers into pre-identified customer groups such as “interested in NFL,” “moms,” “fashionistas,” “interested in home improvement,” or any other number of brand-relevant categorizations.

Some boards even have mounted video cameras which utilize an advanced recognition software to determine a wide range of audience attributes in real time. This allows them to either serve the most relevant creative to passing viewers, or let the public to actually interact with a display. Applications of this technology are already live around the globe. According to Ad Age, one board on a highway west of Chicago can actually determine the make and model of an approaching car. General Motors has taken advantage of this capability by serving targeted ads to commuters who are driving its competitor’s cars. The creative tries to entice non-GM drivers to make the switch by listing all the ways their current vehicle pales in comparison to the advertised option. A similar effort from another car maker is expected to go live in Japan later this year, where tests in that market proved the billboard camera’s vehicle identification capability is around 94 percent accurate.

But beyond advanced audience targeting, many brands have utilized the increased flexibility of digital display systems to better engage with the public in somewhat simpler ways. A few years ago, British Airways tapped into flight surveillance capabilities to pinpoint the exact moment when any one of its airplanes would be passing over a video billboard in Piccadilly Circus. It then triggered an image of a child pointing to the sky, with text that cleverly identified the flight number, origin and invited viewers to “#lookup.” This type of customization was meant to generate a sense of childlike wonder about the places British Airways could take passengers, and proved to be a big hit both with the press and travelers.

Aside from just dynamic creative, there are numerous examples of brands using the power of built-in cameras to create more interactive experiences. For instance, last summer Coca-Cola activated bus shelter space around Chicago by giving fans free samples. It worked by integrating a small lens above an in-panel digital display that helped the system read and interpret facial expressions. During specific times designated by the screen, the public could stand in front of the camera and “share a smile,” in order to receive a free 240 milliliter Coke can. Chilled samples were then dispensed directly from the base of the advertisement.

Another similar use of facial recognition software allowed Amnesty International to present a powerful message about domestic violence. A built-in camera could determine when people waiting for the bus were either looking at or away from its ad. The digital display showed a happy-looking couple when audiences’ eyes were on the screen. When they looked away, the scene changed to show the moments before a physical assault, with the copy reading “it happens when nobody is watching.” A setup like this is considerably easier to execute than some of the more complex examples noted previously, but the effect on audiences is still equally strong.

Though many will argue that besides the potential for increased audience engagement, the greatest benefit these new systems offer are the multitude of post-impression data points. The sheer amount of outdoor activity available for logging and analyzation is astounding. Marketers are now able to see the same type of metrics (and often more) for OOH executions, as they can from online advertisements. In other words, answers to questions about audience psychographics and demographics, placement, quality of impressions, post-viewing engagement and subsequent actions taken can now all be addressed through advanced OOH techniques.

It’s giving advertisers a direct and unprecedented window into the markets in which they’re utilizing smart billboards. All of these elements are working in tandem to decrease the likelihood of a brand’s outdoor ad being overlooked, and to help agencies truly see in real time if their selected placements are working toward clients’ goals. This has brought outdoor into a new class, and further bridged the gap between offline and online media.

Billboards go cross-platform?

Retargeting audiences across other formats after they’re exposed to outdoor ads used to be a somewhat tricky proposition. Sure, one could home in on a market where their brand’s billboard was running and attempt to retarget likely viewers across digital and other offline formats. Though this approach still couldn’t grantee that an advertiser’s targets had been exposed to the outdoor execution.

Now, with the help of geofencing, marketers are able to target audiences on their mobile devices anytime after they drive by a brand’s billboard. This technique is useful across practically every category, but is particularly interesting for quick-service retailers looking to drive traffic spikes during key times of the day. Imagine a fast food billboard that only displays during rush hour and is geared toward people stuck in traffic. Then add in a companion streaming audio ad that only runs once a listener has driven past said billboard. The creative could advise listeners to take the next exit and make their slow commute just a little bit more enjoyable by stopping in for a special offer. Regionality and time of day could all be accounted for to improve effectiveness.

Beacons, while utilizing a different method (Bluetooth low energy) to target billboard viewers across mobile and other devices, still have the same flexibility to take campaigns cross-platform. Outdoor ads can be set up to push anything from coupons to personalized messaging, or even just track a consumer’s browsing or purchase behavior in order to retarget on the web at later dates. Last fall, Levi’s set up a beacon-triggered coupon that delivered special offers to people walking past one of its billboards. The promotion not only delivered an exclusive deal, but also pinpointed the closest eligible outpost from their current location, thus driving higher in-store sales.

This example showcases that increasingly, smart signage is not just about keeping a specific brand at the top of consumers’ minds. Rather, driving impulse purchases and spikes in traffic during key timeframes is emerging as the next big frontier for intelligent outdoor executions.

Where does OOH go from here?

While the capabilities discussed thus far are both enticing and impressive, the world of advanced outdoor actually has a lot of room to grow. For one, the digital signage infrastructure isn’t available across all markets just yet, though the U.S. remains the world’s largest digital OOH market by revenues according to ScreenMedia Daily. Other strong markets, which actually trump the U.S. when it comes to digital OOH exposure, include the U.K., Canada and Australia.

Still, plenty of smaller and mid-size markets in these countries don’t have an abundance of digital signage, especially when it comes to the more advanced and dynamic features. For instance, Clear Channel’s aforementioned RADAR is currently only live in the top 11 U.S. markets. As a result, brands looking to prioritize or simply include outdoor efforts in second or third-tier areas should temper their expectations accordingly. Keep in mind however that thousands of screens are going up annually, so this situation is bound to change as higher spend drives more upgrades.

But aside from issues holding this format back, there are many more that have industry veterans excited for the possibilities. Consider for one the fact that as spend, creativity and the infrastructure of OOH continues to grow, people will look at the format in entirely new ways.

For one, outdoor will increasingly be viewed as a direct response medium. Smart payment systems, through both interfaces built directly into signage and mobile payment, will allow brands to sell directly to on-the-go audiences through their displays. Real-time purchasing from these groups will help brands, especially in the retail category, find new ways to drive higher sales volumes. Digital Signage Today cites figures predicting mobile payment in the U.S. will grow by 173 percent over the next three years, to reach $142 billion by 2019. Imagine if a consumer was able to purchase and receive accessory items, say for their phones, directly from a bus station ad. Or use Android or Apple Pay to tap and purchase items online which are not only tailored to their specific shopping habits, but also showcased on an attention-grabbing digital panel. The chances to effectively hit busy consumers with impulse buying opportunities would grow tremendously.

Billboards that react to consumers and the environment around them will also continue to become more advanced. JetBlue has a digital billboard in Times Square that tells people in the vicinity how quickly they can get to vacation destinations from that location. According to Ad Age, this board uses the Google Maps API linked with JetBlue’s flight schedule to produce real-time driving and flight data for viewers. Eventually, real-world information such as weather, sports, current affairs and social trends will play an even more sophisticated role in a majority of dynamic outdoor ads.

And one can’t discuss the future of outdoor without mentioning its already impressive successes with social media marketing. A few years ago, Coke set up mobile vending machines with built-in digital screens and cameras in cities across the globe. The kiosks allowed people to record a video message, and “buy a coke” for anyone who had access to this machine. Participants chose where around the world they would “send” their coke, and recipients received both a free coke and the original video message. They could then record a thank-you note, which was both posted online and emailed to the original sender. It was an homage to the 1971 “I’d like to buy the world a Coke,” ad, created by Harvey Gabor, and married all the great elements of social media connectivity with OOH. Executions pairing social and outdoor have only grown since, largely because when done well, this format captures attention and drives virality like no other medium. Many marketers now find OOH to be one of the most critical elements to the success of a wide-reaching social campaign.

Speaking of viral, virtual and augmented reality are two elements that are poised to have the biggest impact on outdoor over the coming years. Headset and digital eye glasses may still have a ways to go before mass adoption, but instant hits like Pokémon Go have shown marketers that augmented reality across mobile is picking up steam in a major way. And the more reasons a majority of people have to view the world through their phones, the more opportunities marketers have for augmented ads. It’s a big moment for this segment, since Pokémon Go is the first major mainstream augmented experience for most consumers. Many vendors are working feverishly to fine-tune their ability to display and align digital content over the top of objects in the real world, and the ever-increasing power of mobile and wearable devices will only increase their capabilities.

That said, smart glasses and headsets, the latter focused on full-fledged virtual reality, still have a long journey before they become affordable and practical for many. Google Glass disappeared with almost as much bravado as when it was announced, but it surely isn’t gone forever. And a handful of VR systems are currently trickling into the market. But the real story in this space is the fact that these gadgets will eventually be able to determine a user’s emotional response to ads. Just imagine a world where technology is always on. Maps can be displayed in a person’s frame of view as they walk through a new city, search results will automatically populate as someone wonders aloud and foreign languages can be translated in real-time. Now imagine the type of integrated ad experience markets could deliver to consumers with that kind of innovation. If someone is showing signs of hunger and starts talking about pizza, the brand could deliver an instantaneous ad that directs users to their nearest location or provides a list of menu items with user ratings. Biometric marketing opportunities abound.

Despite the obvious privacy concerns raised with these new possibilities, it cannot be denied that they will further redefine the world of outdoor advertising in groundbreaking ways. Of some solace to the public regarding privacy is the fact that many companies currently offering advanced OOH capabilities are already in compliance with rules set up to ensure the data they use is “anonymous and aggregated,” meaning individual consumers cannot be identified. RADAR for example, will only have access to the data that has long been accessible to mobile advertisers. As of right now, this does not seem to be causing too much of a stir with concerned parties, but as all-in-one devices and public smart boards become more widespread and sophisticated, it will definitely be a situation for brands and advertisers to monitor.

The opportunities offered by this new wave of outdoor advertising will undeniably boost billboard vendor revenues in the coming years. Though by how much all depends upon the successful management of infrastructure and overall cost of dynamic outdoor advertising. After all, the expanded level of personalization won’t be a fit for every client right off the bat, and it can be a cumbersome process for brands and their partners to design the kind of creative that ultimately generates a strong enough response to justify the costs.

But in the end, it’s undeniable how exciting these developments are to advertisers and vendors alike. They will effectively bridge one of the final remaining gaps between digital and traditional media, and ultimately change not only the face of outdoor advertising, but the industry as a whole.