Out-of-Home Advertising Grows to $6.7 Billion in 2012
ADstruc + Telmar
We are pleased to announce a major product integration and strategic long-term partnership with Telmar. An industry first, Telmar’s planning software now seamlessly connects into ADstruc’s buying software, creating the most efficient planning and buying system for the outdoor advertising industry. For more information, click here: http://adstruc.com/telmar
The easiest way to buy and sell outdoor advertising
At ADstruc, our sole focus is on building the best platform possible for buying and selling outdoor advertising.
Today, we’re excited to unveil a whole new platform that provides media buyers with the most effective and efficient way to buy outdoor advertising. This isn’t an announcement about a new tool or a feature to come in a few months; this is a complete workflow solution, ready for you today. This is, without exception, the easiest way to buy and sell outdoor advertising.
We literally spent countless hours with media buyers and sellers at every level to understand how ADstruc can best support them. ADstruc’s new tools were designed with our colleagues from the OOH industry to streamline the process of buying and selling OOH, while supporting everyone involved at every step of the process. From discovering inventory, to planning campaigns, to executing plans, ADstruc’s advanced tools are here to make your life easier.
How to Build Better Technology for OOH
Innovation and Efficiencies in the OOH industry
It is no secret that the OOH industry can benefit vastly from innovation, but it is important to define exactly what kind of innovation will deliver the best results. Recent ADstruc blog posts discussed the good and bad of utilizing external innovation technologies like QR codes and NFC. However, our post today, and ADstruc’s main focus, is on driving innovation from within the OOH industry. We believe that smart technology built by people solely focused on the OOH industry can best address the inefficiencies which exist in the industry today.
Communication and workflow are the two primary areas where innovation through technology can most benefit the OOH industry. First, technology improvements to the various channels of communication used by OOH buyers and sellers will enable everyone involved to conduct their business more efficiently. Secondly, the workflow behind the process of buying and selling outdoor advertising needs to be streamlined with the help of technology solutions.
At ADstruc, we built a company that consistently creates innovative and game-changing technology products for the OOH industry. We were the first to actually listen to the entire industry about its needs, rather than just trying to sell to the industry a product built on assumptions. We were the first to focus on educating the industry about technology solutions, rather than just trying to disrupt the industry with technology. By focusing on efficiencies the industry is asking for, we were the first to create a patent pending RFP automation system. Today, local and national operators, local and national businesses, and media planning/buying agencies throughout the country utilize our products because they were built as a solution to the issues the OOH industry asked to be solved.
Ideate. Develop. Deliver.
It is with our years of experience in building software and with outdoor advertising that we are able to consistently ideate, develop, and deliver quality products for the OOH industry. Our development process does not happen in a closed room. It has always been a transparent process with the entire industry, which enables us to gain insights from all stakeholders and rigorously test our products across large and small companies. This process enables us to deliver a comprehensive solution for both large and small buyers and sellers.
Innovation Cannot be Outsourced
Technology innovation for the OOH industry must come from within the industry. It cannot be outsourced. Engineers have to be passionate about the products they are building and even more passionate about the problems they are solving. Passion for building OOH products and solving OOH problems is rooted in OOH industry experience. ADstruc engineers are not just good; they are great! This is because not only are they some of the best engineers in the highly talented NYC developer community, but also because they eat, sleep and breathe outdoor advertising. ADstruc’s engineers attend client meetings with the business team; share and test products with our clients at every stage in the development process; and, most importantly, build relationships with our clients that facilitate seamless communication. Building the best OOH advertising products is their one and only job. They aren’t also working for other companies in other industries. They start and end every day with outdoor advertising.
Our team is our greatest asset and explains how we have been able to create such an innovative company within the OOH industry. However, that’s just part of it. Here is a brief overview of other key components to building innovation from within the OOH industry:
- Gaining first-hand knowledge of the domain by working in it.
- Making technology development a core competency and never outsourcing your core competencies.
- Hiring the best talent and challenging them constantly.
- Listening to advertisers, agencies, and operators so that you can incorporate their feedback into every product.
To paraphrase Steve Jobs, “innovation is what distinguishes between a leader and a follower”. We take pride in the fact that many companies have taken “inspiration” from our products, but have not been able to keep up with their evolution. Our products continuously evolve as the industry’s understanding of what it needs and how to get it evolves. Our product roadmap is thoughtfully planned out, yet flexible enough to support change.
Some of our competitors committed a cardinal business sin. They outsourced what should be their core competency – technology development. We experienced the problems associated with outsourcing technology development first hand 5 years ago when we started developing the idea behind ADstruc and outsourced the original product. It took 18 painstakingly long months to get our idea even looking like a product, and each iteration, each idea, each “move that button over there” took too long and was too expensive. It was a constant battle. New ideas drown as your outsourced tech team can’t move at the speed and evolution of those ideas and business needs. They will never sync. Development shops do not understand the challenges that the OOH industry face and have no long-term incentive to create quality products. Further, for an industry that has not been a great adopter of new technology in the past, one cannot hope to create the right product in the first iteration. A process of continual technological innovation needs to be followed in order to create a product that addresses all of the major and minor needs of the industry.
Being open to new ways of operating is the first big step. If, as an industry, we continue to focus on what we are good at, while understanding where we can improve, then we can become better at what we all do together. Creative agencies are good at creative. Media planning agencies are good at media planning. Media buying agencies are good at media buying. Technology companies are good at building technology. When we all work together, we learn together, and thereby drive innovation across the entire industry, together.
Out-of-Home Revenue Continues to Grow
The Outdoor Advertising Industry reported Q1 2012 growth of 4.5 percent compared to Q1 2011. The industry boasts eight straight quarters of positive revenue growth.
The latest revenue numbers continue to demonstrate the power of the Out-of-Home (OOH) medium. Additionally, with the announcement of the OAAA’s rebranding last month, the industry is particularly well-positioned to capitalize on this growth.
The industry’s success correlates closely with ADstruc’s continued growth, having added 124 new partners to the platform in the last 30 days. New advertisers to OOH, such as Pebble, have launched campaigns on ADstruc in less than 2 weeks.
Be sure to read the OAAA’s press release below and includes a breakout of Outdoor Advertising Expenditures by category.
(Washington, DC) –Out of home (OOH) advertising revenue rose 4.5 percent in the first quarter of 2012 compared to the same period in 2011, accounting for more than $1.4 billion, according to the Outdoor Advertising Association of America (OAAA). The increase in revenue highlights steady positive year-over-year revenue growth since the second quarter of 2010.
“The out of home industry continues to perform well each year,” said OAAA President & CEO Nancy Fletcher. “Ad agencies and advertisers have realized the value OOH can offer when part of a comprehensive media plan.”
Misc. Services & Amusements recorded the highest revenue dollar growth as the segment continues to lead OOH spending each quarter. OOH ad revenue also grew in the Government, Politics & Organizations segment, which is expected to continue to grow as the election season nears.
“The political season kicks off earlier each election cycle,” said OAAA Chief Marketing Officer Stephen Freitas. “Political advertisers spent on OOH last year and have already proven OOH to be a strategic component in campaigns this year, with spending increases of more than 9 percent thus far. Both candidate and public issue ads will continue to increase spending in the coming months as political action groups and front runners prepare for the November elections.”
OAAA issues full industry pro forma revenue estimates that include, but are not limited to, Miller Kaplan and Kantar Media (which is not adjusted to reflect changes in data sources), and member company affidavits. Revenue estimates include billboard, street furniture, transit, alternative, and cinema advertising, as well as digital platforms for advertising spending.
A New Look for Out of Home
Hello from the OAAA conference in Miami! ADstruc is live at booth #22, and there is big news in the air: The OAAA just launched a new repositioning campaign encouraging advertisers to take another look at Out of Home:
Advertising is constantly changing. With new platforms, converging technology, and increasing audience fragmentation, advertisers today are looking for innovative ways to engage and interact with consumers.
In response, out of home advertising has been changing, too. Today’s OOH offers new technologies, new formats, and more creative thinking to help advertisers take their message further. — OAAA brandbook
Congratulations to all the OAAA committees and contributors who worked on this project. Committing to innovation is an important step for the industry, and we’re excited to be part of it. We’ll be posting our full reaction and analysis later this week, but right now we have to get back to our booth!
OAAA Spending By Category (Q1 2011)
Outdoor Advertising finished 2010 with revenues of $6.1B, a 4% increase from 2009. The first quarter of 2011 represented $1.38B in spending, a 4.2% increase over Q1 2010. The Outdoor Advertising Industry continues to represent a growing piece of the overall ad pie (approximately 5 - 6%). Below, is a breakdown of spending by category for Q1 2011.
As digital out of home (DOOH) and technology continue to drive innovation and efficiency in the industry, we expect to see continued growth. Simply, as the industry’s metrics improve and we continue to make it easier to buy OOH, the attractiveness of outdoor advertising increases!