PETALING JAYA: Despite the fragmentation in the outdoor advertising or out-of-home (OOH) segment, the prospects for this year for the segment look bright.
Industry players attribute the favourable outlook to the relaxation of travel restrictions which they view as a catalyst to increase more traffic on the roads.
Spectrum Outdoor Sdn Bhd managing director Henry Low told StarBiz that the last quarter of 2021 ended with a “vengeance” as advertisers spent their budgets on OOH, more specifically on digital OOH (DOOH).
Traffic returned to the roads and has instilled confidence amongst advertisers for the OOH segment, he said, adding that the outlook for 2022 seems promising as many sectors of businesses “can’t wait” to unload their inventories, products and services.
“For example, the service sector such as for those offering financial assistance, buy-and-pay-later took advantage of the rebounding OOH market.
“The pharmaceutical industry, which also advertises via OOH, promoted its supplement products and deployed its campaigns at a perfect timing during this Covid-19 pandemic.
“Fast food together with food-delivery services also enforced their outdoor advertisements, capitalising on the current situation to boost sales,” he added.
Low said DOOH would spur outdoor advertising growth this year. One of OOH components, which is programmatic DOOH, would be the driver of growth for the OOH market share.
“No other components within OOH have shown any growth in the last two years (2020 and 2021) including. rail, transit, in-store mall, cinema, airport except for DOOH.
“Taffic recovery is faster for road users compared to air, rail and buses, and hence allows advertisers to re-start their outdoor advertising campaigns almost instantaneously.
“Another key driver for OOH is finding an intelligent software algorithm that can match buyers and sellers and target deals based on audience requirements.
“A transaction then can be made automatically and reduce the need of human or media specialist interaction,” he said.
With this in place, he said 2022 would, no doubt, be a better year for not only media owners but advertisers as well.
Programmatic DOOH refers to the automated buying, selling, and delivery of out-of-home advertising – that’s ads on digital billboards and signage.
The Outdoor Advertising Association of Malaysia (OAAM) president Maaresh Starling shares the bullish outlook of the OOH segment.
Maaresh, who is also the chief executive officer of Redberry Ambient Sdn, said the outlook for 2022 in the OOH segment looks good with traffic flow back on the roads.
With more relaxed interstate travel restrictions, he said this would encourage more traffic on the roads thus, more OOH campaigns would be deployed.
Sharing the same view as Low, he said DOOH and programmatic DOOH would help the growth of the OOH market this year.
“More demand-side platform (DSP) is available for advertisers to shop for specific audience base sites. This DSP will allow automated buying and selling as well. And we are in discussion with the Media Specialists Association on how we could grow the market together,” he added.
A DSP is a type of software that allows an advertiser to buy advertising with the help of automation.
As they allow mobile advertisers to buy high quality traffic at scale with minimal friction, DSPs are a powerful marketing automation tool.
Rather than manually contacting hundreds of publishers with offers to advertise, DSPs help advertisers quickly set up campaigns and manage them with ease.
Commenting on the challenges facing the OOH segment, Maaresh noted that an increase in licence fee imposed on advertisers for outdoor advertising by the relevant local councils would be detrimental to the survival of the OOH industry.
Instead, he said the government should help the industry by allowing licence exemption for 2022.
To a question on the fragmentation of the outdoor advertising industry, Low added that it would dampen the growth of the industry.
“Consolidation of companies instead will help eliminate high cost of operations and improve profit margins,” he pointed out.
On the initiatives which OAAM is looking at in 2022, Maaresh said, among others, the association would conduct road shows with stakeholders such as advertisers and advertising agencies to strengthen business relationships which would give OOH a boost.
He said it is also working with the relevant authorities to find ways to improve enforcement and standard operating procedures in the OOH segment, which would be a boon to outdoor advertising.