At e4m OOH Conference in Mumbai on Wednesday, industry veteran Sam Balsara, Chairman of Madison World,  delivered a closing keynote titled “Future of OOH Advertising: Emerging Technologies & Trends.” 

"OOH share in AdEx can grow to 10 percent from the current 4 percent, say 3 or 5 years from now," averred Balsara who also said that he's bullish about the prospects of it coming into fruition in India because of the arrival of technology, rapid adoption of the digital age and the immense possibility that programmatic will offer to advertisers, which enables optimum use of even non-market sites.

All of this will allow us to operate not just in the market, which is estimated at 4%, but participate in the larger digital market.

Speaking up on the possibilities of the OOH sector growing six percentage points up from the current 4 percent, in the next few years, Balsara shared, “According to a WARC report, Global AD X will record an ad spend of over $1 trillion and will establish a compound annual growth rate of 7percent in the last five years."

"Now, by Indian standards, 7 percent may not sound impressive, but it is by global standards. AdeX rates from 2018 to 2022 have been growing, from a high of 17.7 percent to a low of 1.3 percent. The good news is that we (India) are now seeing a steady, accelerating growth from 3.5 percent in 2022 to a projected 8.3 percent in 2024,” he noted. 

Digital is not a standalone medium

Digital is the only medium that has grown in share in the last five years, but it has grown at the expense of every other medium, including the mighty television and print. As we all know, print has lost serious market share to digital in the last decade. But the good news is that in the last five years, the rate of decline has lowered, Balsara stated. 

"In India, the story for print is a little different from the rest of the world. Against a global share of just 3 percent, print in India commands a share of 19 percent. Also, unfortunately, WARC expects OOH globally to drop its share in 2024,” he noted. 

Digital has grown as a standalone medium and digital technology has penetrated every other medium significantly in television, Balsara noted. “We have connected TV where the delivery is through the use of digital technology, and that contributes 17 percent to total TV, web versions contribute 30 percent to print publishers revenue and podcasts and whatnot contribute to 35 percent to radio or audio."

"So it does strike me that very soon we will have to really re-categorize these labels of print, TV and radio and conceptualize some other terminology to give us a better understanding of how intermedia is working. Of course, television and digital universally across the world and almost every country are the two big boys and contribute close to 90 percent of ADX."

"When one talks about advertising, you could say it's all about television and digital. And I think it is for us in this room to take on the challenge of bringing the outdoors into this set. If I take a closer look at each medium, including digital, it estimates that total ADX in 2024 will be at $53 billion, up from $49 billion, with almost the entire increase coming from digital. Globally, OOH AdEx de-grew only 14 percent during the Covid year. But in India, there was a big carnage, but then it grew sharply by 20 percent in 2021 and now is expected to grow by 7 percent in 2024."

"If you take the last few years, total AdEx and OOH AdEx mirrored similar growth rates. This is good news because OOH Adex growth always lagged behind the total AdEx growth. So it does tell me that recognition of the digital age is tremendous, its contribution is tremendous, and its recognition by the advertiser is also now getting firmly established or appreciated."

China is at the top

Balsara also explained with graphs how China has the highest growth of the OOH sector, which is almost four times that of the global average. According to WARC, in China OOH's share in the total AdEX is 14 percent against the global share of 3 percent and India’s share of 4 percent. 

The other countries with a high market share besides China are Japan, France, Germany to some extent, Australia and Brazil. Perhaps this, he said, suggests the industry body should undertake a study tour to these countries, especially China, Japan and France, to study what circumstances have led to these countries having such a high weight share. 

Balsara also noted that in India the extent of under-indexing is huge, apparently in technology and electronics. He suggests that the industry must make special efforts with advertisers in these categories to convince them about their capability in building brands in these categories."

Balsara noted that despite a promising 13 percent growth rate in 2023, double the global average, there's a sobering reality check regarding ROI analysis. 

“A chart from Epic Quality and Game Theory suggests that while television boasts a 71 percent ROI, online video and radio lag behind at 3-4p ercent. However, many advertisers don't take this data seriously,” he noted. 

Sharing the testimonials of marketers from finance, automotive, and FMCG sectors, Balsara said there is a consensus on outdoor's strengths: its impactful, flexible, and hyperlocal nature. Yet, our market share remains modest, highlighting barriers like fragmented ownership, lack of confidence, and regulatory ambiguity.

Recommendations

To boost outdoor's share to 10 percent, we need concerted efforts. Firstly, educating advertisers on outdoor's efficacy and developing case studies are paramount. We must also address creative shortcomings, advocating for bold, visually striking campaigns to maximize impact, Balsara shared. 

He further noted that integrating technology like programmatic buying and enhancing audience targeting can expand outdoor's reach. Simplifying metrics and enhancing advertiser confidence are crucial steps forward.

“Lastly, embracing innovations like parallel reality technology, which personalizes airport information displays, showcases outdoor's potential to evolve with the digital age. By aligning strategies, educating stakeholders, and embracing creativity and technology, we can elevate outdoor advertising's prominence in India's media landscape,” he shared.