A Paradigm Shift for the $25 Billion Outdoor Advertising Industry
September 23, 2010
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The $25 billion outdoor advertising industry is turning from the old sluggish platform of static poster advertisements to a new media platform thanks to digital displays. LCD and plasma displays have already made a significant impact on the indoor advertising industry, such as in train stations, shopping centers and airports. The ability to change advertisements throughout the day and to show much more memorable animations and video, are key reasons why digital advertising is much more lucrative for advertising companies. The new model is now to sell time rather than display space. Indeed, Clear Channel, one of the largest operators of outdoor advertising media, reported a sales increase of up to 900% in some circumstances where digital advertising had replaced the old boring static versions.
Advertisers have a huge amount to gain from converting their static advertisement sites to digital versions. In many countries, there is a limit on the number of new billboards that can be placed, which has resulted in a somewhat saturated market. Digital signs have already demonstrated to advertisers that they can help to tackle this by taking market share from other media platforms and they also improve performance - that is, they provide a more memorable experience for the target audience.
Limitations of conventional digital displays
However, while digital advertising is exploding in indoor environments (where they even sometimes double as signage), that same technology isn't suitable for most of the millions of larger outdoor billboard posters. LCD and plasma screens are small and become too expensive to daisy chain to create an area the size of a typical outdoor billboard. Here, LEDs have been used, but they have some significant limitations which prevent them from being adopted at most sites. Firstly, they are much larger, thicker and heavier devices and usually the billboards need to be reinforced to support the extra weight. More importantly, unlike static printed billboards, LEDs emit light and there are tough government restrictions dictating that they should not dazzle drivers or be a nuisance for residential homes at night. These restrictions are often locally governed so there is no one rule across the whole country. That means each site needs its own approval. In addition, power consumption is also an issue.
Eric Penot, Digital Media Director at the $2.6 Billion advertising media company JCDecaux S.A, says, "The existing products based on LCD/Plasma/LED present a number of challenges to the Digital Out-of-Home (DOOH) industry - size, energy consumption, visibility, weight, etc. We have a long wish list.”
Advertisers have a huge amount to gain from converting their static advertisement sites to digital versions. In many countries, there is a limit on the number of new billboards that can be placed, which has resulted in a somewhat saturated market. Digital signs have already demonstrated to advertisers that they can help to tackle this by taking market share from other media platforms and they also improve performance - that is, they provide a more memorable experience for the target audience.
Limitations of conventional digital displays
However, while digital advertising is exploding in indoor environments (where they even sometimes double as signage), that same technology isn't suitable for most of the millions of larger outdoor billboard posters. LCD and plasma screens are small and become too expensive to daisy chain to create an area the size of a typical outdoor billboard. Here, LEDs have been used, but they have some significant limitations which prevent them from being adopted at most sites. Firstly, they are much larger, thicker and heavier devices and usually the billboards need to be reinforced to support the extra weight. More importantly, unlike static printed billboards, LEDs emit light and there are tough government restrictions dictating that they should not dazzle drivers or be a nuisance for residential homes at night. These restrictions are often locally governed so there is no one rule across the whole country. That means each site needs its own approval. In addition, power consumption is also an issue.
Eric Penot, Digital Media Director at the $2.6 Billion advertising media company JCDecaux S.A, says, "The existing products based on LCD/Plasma/LED present a number of challenges to the Digital Out-of-Home (DOOH) industry - size, energy consumption, visibility, weight, etc. We have a long wish list.”
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