Facing the decline of traditional media and an increasingly fragmented overall market, advertisers are looking to Out of Home to provide reach with a broad audience. Time, then, for a squiz at the trends in this growing sector.
There’s an element of ‘back to the future’ in the growth of New Zealand’s Out of Home (OOH) market in 2024. In a world of pop-up ads, AI-generated content and a vast array of social media platforms, the old-fashioned stick-an-ad-where-people-will-see-it approach is once again coming into its own. In a year that saw many media channels experience a decline in revenue, OOH maintained its growth trajectory, with the Out of Home Media Association of Aotearoa (OOHMAA) announcing that its members’ 2023 revenue grew by 9.4 percent year on year to $179m.
There’s much more to it these days than just your traditional signs and posters. OOH might take the form of roadside billboards and street furniture, advertising on public transport and at airports, or on display screens
in shopping malls. Advertisers can use sophisticated ad-buying technology to target certain audiences or locations, or hand-painted signs and street art to leave an impression on those walking by.
CEO of OOHMAA, Natasha O’Connor, says the growth of digital and programmatic tools gives advertisers more options, but the classic billboard still has its place.
“Out of Home today offers advertisers more ways to engage with their audience with greater effectiveness. The speed at which technology is advancing within digital Out of Home (DOOH) and Programmatic Digital Out of Home (pDOOH) allows a level of flexibility, immediacy and dynamic targeting power [like never] before; however, it’s important to remember the power of the classic format that delivers 100 percent share of voice 24/7.”
Work trends give it a boost
OOHMAA’s latest research project, Aotearoa In Motion, found OOH reaches 80 percent of all urban-dwellers 18 years and older each day, higher than social media (76 percent) and well ahead of other channels like online video (48 percent), linear TV (47 percent) and radio (47 percent). The research showed the flexible work model is causing an increase in commuter windows and more micro- trips throughout the day; the average Kiwi spends three hours a week commuting and 74 minutes a day travelling overall. Although 67 percent of white-collar workers have flexibility around the locations and hours they work, nearly 60 percent of Kiwis still commute into city centres or inner suburbs to work.
“The strength of Out of Home now is what it’s always been – the fact that it’s everywhere,” says O’Connor.
“We’ve got over 10,000 sites in New Zealand, so the sheer scalability of it is huge. You also have the fact that 83 percent of all trips taken in Aotearoa are by car, often alone, so Out of Home messages are seen as a welcome addition to the traveller’s landscape.”
In a digital world, OOH’s “probably the last true broadcast medium out there”, according to GM of JCDecaux New Zealand, Phil Eastwood.
“Clients are using us to reach mass audiences quickly and in a shared manner. When Out of Home’s done well, it can create that ‘water-cooler moment’ TV used to create – people discussing what they saw the night before.”
Creativity is key
The benefits of OOH campaigns are only fully realised if the creative is effective and designed specifically for the channel, says Eastwood.
“I’ve been selling Out of Home for over 25 years now, but the one key factor is you can buy any campaign you like, but if you don’t get the creative right, you’re missing an opportunity – and we still have that challenge where unfortunately Out of Home is sometimes the medium that’s last considered in terms of creative.”
Eastwood says even though Out of Home is now one of the key mediums most advertisers use in big campaigns, it’s often considered after TV messaging.
“They’re making that TV ad today; they all love to do that. Then they think, ‘Oh, we’ve got to do it for Out of Home’, and they all of a sudden quickly grab a scene from the TV. Many campaigns assume people have seen the TV ad, which is less likely with fragmenting audiences.”
To help advertisers fine-tune campaigns, JCDecaux uses a product called Optix, which uses predictive machine learning to review the visual effectiveness of creative to predict its saliency and potential memorability. Eastwood says mistakes include putting too much on a billboard (“It should be seven words or less”) and unclear branding. He says OOH advertising has its own nuances and needs to be built separately within a campaign, or even placed at the forefront of it. “This is what’s happened in Europe; before they actually start to work out what they’re going to do on the rest of the campaign, they work out the messaging they’ll want to put on the Out of Home component.”
Shopper foot traffic increases
Roadside billboards are always going to be prime real estate in gridlocked cities such as Auckland, but in these post-pandemic times, advertisers are increasingly drawn to destinations with significant foot traffic, such as malls and airports.
Scentre Group, the owner and operator of Westfield destinations in New Zealand and Australia, saw visitation for its New Zealand portfolio grow by 7.2 percent in 2023, underpinned by activation programmes including new strategic partnerships with leading brands such as Disney and Live Nation Entertainment.
By offering more reasons to visit their destinations, Scentre Group’s business partners achieved record performance, with partner sales growing by 7.3 percent across Albany, St Lukes, Newmarket, Manukau City and Riccarton Westfield destinations.
Richelle Scott, Head of Sales NZ for BrandSpace, the in-house media and marketing division of Scentre Group, reflects on the past year: “In 2023, BrandSpace went through a transformation with regards to our media, marketing and retail capabilities to better meet the needs of our business partners.
“We turned on programmatic across our 100 percent digital SmartScreen network, offered new 3D creative capabilities and developed a market-leading approach to campaign planning, reporting and measurement.”
BrandSpace has also spent time with their partners to ascertain their expectations in OOH and what’s required
to enable businesses for growth, says Scott.
“Resounding feedback” from these conversations highlighted the need for customer insights, measurement, and continued strategic and elevated service.
“We listened and acted, collaborating with partners to improve capabilities in campaign planning, aiding screen selection and customer targeting via an intelligent, data-informed approach. We’ve also gone deeper on understanding our customer, [going] beyond traditional demographics to profile and segment against their diverse needs.”
Attention grabbing
Perhaps the most unique OOH asset in Aotearoa is ‘The Sylvia’, oOh!media’s (almost) 30m2 3D-capable Video Out
of Home screen (VOOH) at Kiwi Property’s Sylvia Park in Auckland. Product Innovation & Solutions Director at oOh!media New Zealand, Rick Goodwin, says the ambitious project had its share of challenges.
“Sylvia Park is New Zealand’s largest retail centre and came with many engineering and logistical challenges to
get a 2.5-tonne large-format screen into a working mall. On top of that, a big part of our product positioning is that all assets are ‘designed to be seen’ – so to ensure we continued this mantra, we angled the screen 10 degrees downwards to maximise audience viewability, positioned it on the northern side of The Cone to avoid sun strike, and optimised the pixel pitch and media player for video content.”
At the other end of the scale, oOh!media has partnered with Big Street Bikers, who operate Locky Dock, a nationwide network of bike parking and charging facilities. Goodwin says the move will help oOh!media grow its digital scale and coverage into new regions in 2024 and is another initiative to support its environmental objectives.
“It’s about trying to get people out of cars and onto bikes and/or public transport, lessening the carbon footprint and impact on the environment.”
Regardless of screen size or location, measurement data is increasingly important for advertisers. Goodwin says the development of the Calibre tool (jointly owned by JCDecaux, MediaWorks and oOh!media) is crucial for the industry.
Calibre now accounts for roughly 85 percent of total OOH inventory in New Zealand and can provide audience data for a range of OOH formats, including street furniture, billboards, buses, and internal environments such as retail and airports.
“Outside of Calibre, we’re continuing to evolve our own proprietary audience-targeting tools powered by mobile location data, with Smart Reach coming to market in the next few weeks,” says Goodwin.
The rise of programmatic
Reach and frequency remain the hallmarks of OOH, but the addition of programmatic tools originally developed for online ads allows for more precise targeting of audiences. OOHMAA figures show pDOOH shot up from 2.6 percent of DOOH revenue in Q2 2022 to 9.3 percent by the end of 2023.
NZ Sales Director for pDOOH platform Hivestack, Ash Houghton, says that although it’s taking the ad industry by storm, programmatic tech isn’t well understood by the public. “When people ask what I do for a job, I say, ‘Do you know anything about programmatic advertising?’, and 99 percent of the time, they say, ‘No, I’ve never heard of it’,” he admits.
Houghton explains that when you search for a product on Google and an ad appears on the screen, in the background different advertisers are optioning against each other to serve that ad to you at that time.
“What we’re doing for programmatic Out of Home is using that same sort of formula and trying to serve relevant ads to people as they move throughout the physical world through digital Out of Home panels.”
This technology enables advertisers to target audiences based on location and demographic factors, time of day
and even the weather. Hivestack worked with Lumo Digital Outdoor on Fire and Emergency New Zealand’s ‘Keep a metre from the heater’ campaign, for which ads activated only between 4 and 8pm, when the temperature dropped below 15°C, and a wildfire safety campaign that harnessed the power of real-time localised fire risk levels.
“They didn’t want to buy a billboard in Nelson and have the summer go by [only to find], actually, there’s no fire danger in Nelson, so that booking was a waste,” says Houghton.
“We had a data signal feeding into the platform that would look at fire danger levels throughout the country and if the fire danger was very high in Gisborne, we’d then start bidding on Out of Home screens in Gisborne.”
A digital-only world?
Lumo Digital has been involved in a number of innovative campaigns, including the first successful effort in programmatically activated split creative (for Uber). They activated the first use of live sports data (Tribe) and film-session time data (flicks.co.nz) for DOOH here in New Zealand, and introduced split-messaged DOOH Dynamic Creative Optimisation (DCO) creative as part of a campaign for Speight’s.
GM of Platform & Partner Strategy at Lumo Digital, Jack Plowright, has a bold prediction: the New Zealand large-format and street-furniture OOH market will go 100 percent digital within the next decade.
“The comments that ‘there will always be a role for static/classic’ simply aren’t backed up by the spend numbers,” he says.
“Static supply will continue to be offloaded where feasible.”
Plowright says that in the digital era, advertising is starting to shift from the screens we walk around with in our pockets all day to the ones we see outdoors.
“We’re now seeing the URL move to IRL. DOOH is a channel that can firmly hold its own and better against other digital inventory, but without the issues of ad fraud, transparency, viewability and safety that plague a large majority of digital inventory that exist online.”
However, he warns that these features of OOH advertising will go to waste if you don’t get the basics right.
“Recent studies in the UK reported that seven out of 10 OOH ads don’t work,” he says.
“This is not to be mistaken as ‘OOH doesn’t work’, but [interpreted to mean] that the treatment of the channel creatively hasn’t provided the format much to get its point across.”
Splashing out
One man still enamoured with paint is Robin McDonnell, CEO of Phantom Billstickers. The company has been putting up street posters since 1982, and McDonnell says hand-painted formats are “really hot right now”, despite the general shift to digital.
Combined with modern technology such as LED lights and soundscapes, they can create an immersive experience that stands apart from typical billboards and posters.
“We just did a really cool one for Pearl Jam, for the release of their concerts later this year, which has basically taken over our site that almost spans a whole city block, and pumped the opening riff to Alive along the site so you basically can’t escape it, even if you’re walking through that site blindfolded,” he says.
“On the hand-painted front, we recently did a giant wallscape for beer brand Mac’s. It was a hand-painted site and then a big poster wall in front of it that created a whole experience. The common thread there is that they’re creative ideas that are playing with the format and taking it to the next level.”
The biggest trend in their market segment globally is around “selling emotion”, says McDonnell. “Brands are
really looking to form emotional connections with their audience, and that’s how you add value and create that customer loyalty. That leads to the idea of using strong storytelling and advertising as well, and our network’s
really, really poised for delivering on that.”
Reaching the regions
It’s not just the big cities in which OOH is proving useful for advertisers. Managing Director of Vast Billboards, Grant Moreton, says the regions had been somewhat forgotten by the industry, but that’s changing. Founded in Christchurch in 2020, Vast has quickly built up a significant network of more than 40 sites nationwide, including in provincial towns like Greymouth, Ashburton and Timaru.
“Covid showed that the regions were really important for a lot of businesses, because while the big cities closed up, the communities of smaller towns carried on,” says Moreton.
“The same people as you and I live in smaller communities, and they all have to buy food, they all have a car, they’ve got to buy insurance, they still want to go to Fiji once every two years. That’s why we’re helping advertisers share their messages with these audiences.”
Vast is a family business, with Moreton managing billboard installation, his wife Louise running the finances and their daughter Ivana handling the day-to-day business function. At any one time, they may have between 10 and 15 billboards in the process of getting approval, he says.
“That involves the resource consenting, going through traffic engineering and urban design consultants, so some of these consents can take anywhere from six months to two years. It can be quite a lengthy process.”
Moreton, who started out running airport advertising displays in New Zealand and Fiji, says OOH attracts a broad and interesting mix of advertisers.
“I was just talking to a client who sells electric motor vehicles, and he said to me, ‘Newspaper no longer works. My audience for electric cars is not reading newspapers – they’re young people’. Then he said, ‘I use your digital billboards to gain access to that audience’.
“I’d never have thought that rest homes would’ve been a big advertiser, but they’re one of our core advertisers, and it’s not the elderly who’re looking at our ads, it’s their children. It doesn’t matter what sector; we had a customer ring up not so long ago and say they were from the Ashburton [Society of the Arts] and they’re having a 50-year get-together. We help share important messages to an often untapped audience – that’s what I think makes this business exciting.”
This was first published in the March/April 2024 issue
