In the contextual ad battle, out-of-home beats broadcast every time

Contextual relevance is difficult to achieve when you can't even be sure your audience is really there, explains Jack Mortlock, commercial director at Tonic Health Media.

The media industry continues to shout about the importance of contextual relevance when it comes to grabbing digital audiences. The funny thing is, agencies often overlook the opportunities presented for place-based out-of-home media to deliver the same engagement in physical environments.

Traditional media will always have a place on budgets, that’s not in contention. TV, radio and print are solid channels that work for broadcast and limited targeting, and agency spend with these channels will remain strong. What’s also not up for debate, is that these channels’ audiences are shallowing out, and fragmenting. The surety around when and where these channels will get consumed is diminishing. While they’ll always be great at building brands, their capacity to catch an audience in a predefined moment-in-time or context is not what it once was.

The issue is the legacy of routine when it comes to media channel spend. TV and radio alike still attract a certain percentage of dollars, arguably because ‘that’s the way it’s always been’, and just like digital and especially programmatic are giving the industry pause-for-thought about these practices, the same is happening with out-of-home.

Traditional channels still attract a certain percentage of dollars, but just as we have seen with the rise of digital and latterly programmatic’s impact on TV, print and radio, the out-of-home industry needs to consider how it can deliver a more refined audience in a more refined way.

Out-of-home is enjoying a much-publicised boom at the moment, posting strong growth for the past seven years. According to Nielsen, Out-of-home media spend in Australia topped $679 million in 2015, up 2.4% YoY. Recent OMA figures show out-of-home finished 2016 with a 15.8% increase in growth, taking the industry’s net media revenue to a record high of $789.5 million, up from $682.1 million in 2015. In January this year, the industry posted an 11.6% revenue increase from the same month last year.

Much of this spend is being chewed up by the broadcast networks, JC Decaux, Adshel and APN. There’s a good argument that prevailing doubt about how to actually reach people in a modern world is fuelling a renaissance. Agency buyers and planners are spending more with out-of-home because the audience is unquestionable. People move around. People go places and see things. It’s more intuitive than wondering if the audience looked up from their phones during your TVC, or if anyone stopped to actually look at your Mrec while they scrolled through the news.

It’s where this traditional and digital doubt creeps in, that the opportunity for targeted, place-based out-of-home communications begins to make their case. Contextually relevant out-of-home is one of the most exciting sectors of the game, simply because it melds an obvious audience consideration set with an actual concrete audience. Think gyms and airports. These contexts offer an audience where their mindset is much less up-for-debate than other media channels.

Research from Adshel shows contextually relevant out-of-home advertising is 19% more effective on average. Physical context (alongside changeable factors like time-of-day and weather) offers huge insights into consumer mindset and motivation. That’s why you see VMO’s Active network in gyms carrying ads for Berlie, BMW and Pure Blonde. Or why APN Outdoor’s Airport network hosts spots for Samsonite and Prada.

Those brands are leveraging location and context to target consumers with clear intent and motivations. It’s the same kind of contextual relevance that digital is extolling as new and exciting. The difference is, out-of-home isn’t plagued by the same viewability concerns. And when someone is at a distinct location there intentions are clear. They’re not just browsing.

Jack Mortlock is commercial director at Tonic Health Media.


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