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Insight Analysis: Mini-boom Predicted For Outdoor Advertising

Insight Analysis: Mini-boom Predicted For Outdoor Advertising

After a slump during the first six months of 1999, outdoor advertising is back on track with the latest estimates for revenue growth in 2000 showing a mini-boom in the industry. Optimedia’s latest report predicts a growth of 8% during 2000, double the growth rate in 1999, and 3% higher than that predicted for total advertising revenue.

There are a number of reasons for an about-turn in the industry. Firstly, the influx of dotcom ads which increased revenue across the board last year. AC Nielsen-MMS estimates that dotcoms represented 2.3% of outdoor spend, excluding transport, in 1999. Secondly, the major outdoor agencies have been introducing a number of innovations in recent months, raising the profile of the industry and making it more attractive to advertisers.

Last week the More Group announced plans to introduce two new outdoor formats, one of which – Scrolling 48s – will bring day-part advertising to the UK, allowing clients to choose the time of day that their ad is shown.

Transport group TDI recently introduced a new division solely for non-standard ads. This division will help develop alternative strategies for outdoor advertising, such as the recent campaigns for ready2shop, which covered an exhibition walkway at London Fashion Week. Improved ease and diversity from such innovations will also be complemented by the recent introduction of improved production technology, lowering the entry costs to the medium.

Diversity has been a major factor in the increased growth of the medium. As agencies exploit and expand the richness of the outdoor market, new formats are attracting new categories of advertiser. In 1977 just two product categories – tobacco and drinks manufacturers – comprised 68% of the outdoor market; in 1999 a total ten categories made up 75% of revenue, according to figures from MMS Outdoor.

Taking all these factors into account, Optimedia sees an imminent boom in the outdoor market. Ambient media and 6-sheets will continue their expansion and outdoor is expected to take £605 million during 2000.

Optimedia, however, sees a short life to the boom, predicting that after a dramatic growth year during 2000 demand for the medium will begin to level off. A plateau in the growth of outdoor will be reached as the 6-sheet and ambient marketplaces reach saturation point and traffic begins to wane with the growth of home shopping.

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