The US digital out-of-home (OOH) media industry – which includes video ad networks, digital billboards and ambient ad platforms – is on pace to grow 11.2%, to $2.43 billion in 2008 and now comprises 29.1% of overall out-of-home ad spending, according to the “Digital Out-of-Home Media Forecast 2008-2012” from PQ Media.
While PQ predicts the industry to experience a shakeout that will cause its growth this year to decelerate from 2007’s 24.5%, digital OOH is still among the fastest growing ad media in the US with an expected compound annual growth rate of 12.9% between 2007 and 2012. US digital OOH spending has tripled since 2002, growing 23.1% on a compound annual basis from 2002-2007 and exceeding 20% growth each year of the period.
Additional forecasts for specific media:
PQ media forecasts digital OOH spending in Europe, Asia and the Americas to grow 12.8%, to $6.11 billion in 2008. This growth is slower than last year’s 22.6% rate, but digitial OOH is still expected to expand 14.5% from 2007 to 2012.
Though the US now accounts for nearly 40% of global digital OOH spending, this share will decline over the next several years. Key international growth markets will be Russia, India, China, Brazil, and Australia, among others. These countries will benefit from major trends such as emerging market potential for operators, greater brand acceptance, advanced technology and new measurement systems, the report said.
The most active digital OOH brand categories in 2007 were CPG & electronics, followed by media & entertainment, food & drink, and retail. Overall, 66% of digital OOH ad spend was national versus local, with video ad networks featuring more national advertising and digital billboards generating more local, according to PQ Media.
Among the key trends going forward are the emergence of venue-based media solutions, which combine multiple digital OOH options and other marketing strategies, such as event marketing and sampling, to provide brand marketers with a range of out-of-home venues, platforms, demographics and psychographics to build brand affinity.
PQ Media also predicts that advertisers will continue to boost spending in digital OOH as consumers spend more time outside the home and reduce traditional media usage. Escalating gas prices, for example, prompted more consumers to utilize mass transit in 2008, creating expanded audiences for digital OOH advertising that reaches bus, train and subway riders.
“This medium is too powerful not to breakout at some point in the next couple years because the secular trends driving its growth are not going away,” said Patrick Quinn, president & CEO of PQ Media. “The industry’s direction is still evolving, but the adoption of standard measurements and business practices will go a long way toward placing digital out-of-home in theregular media mix.”
The digital OOH media sector enables advertisers to engage target consumers in captive locations during their daily routines through video advertising networks, digital billboards and ambient ad platforms. The media platforms are further categorized by various venues and locations, including theaters, retail, offices, entertainment,transit, universities, roadside, and on various objects.
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