US DOOH Spending On Track for 15% Growth

December 8, 2010

US digital-out-of-home (DOOH) advertising spending grew 14.9% in the first half of 2010 and should grow 14.8% for the full year, according to a Digital Signage Expo review of PQ Media data.

DOOH Spending Expected to Hit $2B

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DOOH advertising consists of two revenue streams: digital place-based networks and digital billboards and signage. For the full year 2010, total US DOOH advertising spending is expected to reach $2.07 billion.

Breaking DOOH advertising spending by revenue stream digital place-based networks are expected to bring in $1.53 billion by year’s end, with 13.7% growth the first half of the year and 14% growth the full year. Digital place-based network revenue represents almost three-quarters (74%) of total DOOH revenue.

The remaining predicted $541 million will be contributed by digital billboards and signage spending. However, although this stream is much smaller, its growth is better, with increases of 18.2% the first half of the year and 17.2% the full year.

PQ Media identifies shifts in consumer behaviors, improved audience metrics, more effective sales and marketing strategies, growth in key brand categories, consolidation and better scale, new technology, and the integration of mobile and social media as all driving DOOH ad spending growth.

Most Digital Place-based Venues Grow at Double Digit Rates

PQ Media data indicates four of five digital place-based venues: cinema, office, entertainment and transit, will have double-digit growth rates this year. The fifth venue, retail, is expected to post a high single-digit growth rate. Retail was the only digital place-based DOOH venue to post negative spending growth in 2009.

Three of Four Digital Billboard/Signage Venues Also Grow at Double Digit Rates

Most digital billboard/signage venues also are expected to grow at double-digit rates this year. Roadside (identified by PQ Media as the largest and fastest-growing digital billboard/signage venue), transit, and entertainment are all expected to have double-digit revenue growth this year, with retail posting mid-single-digit growth.

Digital Media Spend Remains Traditionally Focused

The breakdown of media spend in digital is focused mainly on traditional online media choices, according to a recent study from digital marketing agency Razorfish. Online media outlets that have existed for a long period of time, such as verticals, search, ad networks and portals, received the bulk of digital ad dollars spent in 2009. Verticals and individual sites received the highest share of digital ad spending, slightly more than 30%. These were followed by search sites and directories (25%), ad networks (20%), and portals (about 12%).

No form of “new media” even obtained 5% of digital ad spending in 2009. The most popular form of new media, social media display, received about 4% of digital ad spending. Data brokers, ad exchanges and mobile all received about 2%, with other new media such as non-display social media and digital out-of-home (DOOH) barely registering. Interestingly, email, arguably the oldest form of traditional digital media, had one of the smallest shares of ad spending.

About the Data: PQ Media’s digital OOH methodology, databases and panel track 267 digital place-based network operators and 117 digital billboard and signage operators in the US.

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