Is digital the future of outdoor?

Ed Feast, managing director of MarketPlace, comments on the advantages and disadvantages of digitising out-of-home…

At a recent IPA and Outdoor Advertising Association conference, Jean-Paul Edwards, executive director, futures at MGOMD, proclaimed that the outdoor industry should not “try to be the last broadcast medium” and went on to claim that digital was the future of outdoor.

This sentiment was echoed by Mike Baker, chief executive of the OAA, and taken a step further by John Willshire, chief innovation officer at Phd, suggesting that all out-of-home should be digitised.

There are without question advantages to digitising out-of-home inventory. Advertisers will be able to run more dynamic campaigns as lead times are dramatically reduced.  These developments will also allow for copy to be updated to reflect real time changes in offers – traditionally a barrier to entry for special offer based campaigns by major retailers.

The new networks will also allow for copy to be tailored to regions, counties, and even towns, paving the way for more versatile and relevant communication.  Furthermore, the new screens will improve the quality of display across the board, which will no doubt tempt more premium brands to branch out a little further than their current stable of high profile landmark sites.

New facial recognition technology could be implemented to calculate whether the majority of impacts were male or female, young or old, and serve adverts accordingly. This in turn could lead to a major change in the way that out-of-home is traded, perhaps moving to a TV style model.

In future, advertisers might buy outdoor advertising by impacts against a target audience, which would be delivered over an agreed period by the contractors based on predicted impacts, which would be reconciled each month.

The opportunities from the point of view of the advertiser, creative, and media agency look enticing. If the changes could be implemented quickly and at low cost, then the decision would be simple. Unfortunately this is not the case though.

As with everything, there are issues. Firstly, there is the potential effect on the environment. Outdoor contractors have gone to great lengths to ensure that they are environmentally friendly, with recycling programs and high standards of compliance. New digital inventory would have to match this approach, sourcing electricity from renewable sources. The most obvious source would be solar energy, although the cost of this is often prohibitive.

Secondly, there is the problem with being too targeted from an inventory management point of view. It’s great to be able to split out your best sites and charge more for them, but the issue of trading the less desirable sites then becomes an issue. Take the London Underground as an example – premium sites sell out quickly, whilst standard sheetage can have relatively high voidage as larger, more inclusive parcels become more difficult to sell.

Thirdly, and arguably most importantly, there is the knock on effect on the industry as a whole. Would digital posters mean the loss of the printers, and bill-posting staff, the couriers and the maintenance staff? Granted, some workers can be retrained, but it would invariably cause printing firms to go under and cause considerable job losses.

With such a large potential knock on effect, will the major players see the value in such a seismic change?

The question is whether the investment required to implement the development will outweigh the potential revenue increase decades down the line.

With such long-term commitment to massive spending on inventory and infrastructure, and the prospect of delayed returns at best, it will take a very brave board of directors to commit to this.