'Kudos for initiating Roadstar, but there’s a long way to go'

Outdoor advertising media in India has evolved into a dynamic and influential force shaping consumer behaviour. The resurgence of this sector after the pandemic has been impressive.

Globally, the picture also seems bright with spends climbing to $41.9 billion for OOH. It is the only legacy media growing in terms of share of media spend.  

But, in terms of the share of its India AdEx, it's only 3.6%, whereas overall APAC’s average stands at 8%. This means that although the sector has been revived, OOH in India still needs to go that extra mile.

In a conversation with e4m, Tom Goddard, President, World Out of Home Organization (WOO) and Chairman, OOH Capital, explained the current state of OOH in India, examining its growth trajectory, challenges, solutions and what its future holds. Here are the excerpts…

1. How is India's Out-of-Home (OOH) landscape perceived as of today globally? 

The Out-of-Home industry in India falls into two categories. There is the large-format billboard section, and then there is the more controlled street furniture and transit airport section. And the latter is more organised and more accountable; the large-format billboard market has a lot of investment to make to bring it up to international standards. 

2. Where does India stand in terms of ad spends on OOH when compared to other countries?

There's definitely a low share of overall AdEx that comes from Out-of-Home in India. 

3. How can more brands be brought back to OOH for better revenues? 

If the industry can put things right and start to show the brands that they're taking steps to be more accountable, the brands will support it because they love the medium. 

Brands are beginning to see that they've over invested in attribution and they've over invested in online media, at the expense of brand recognition, particularly with the young demographics. So they're pulling budgets back into OOH because it's one of the strongest branding media. We have to keep an eye on real growth in terms of increases in revenue output and growth in terms of AdEx share. 

4. Anamorphic, 3D, CGI ads are definitely on the rise worldwide. Why don’t we see that scale of outdoor advertising in India, like we do at The Sphere, Las Vegas or Times Square, New York? 

They are all very photogenic and interesting subjects, but they're a minuscule part of the overall OOH landscape. I think the issues are more fundamental and some of them are common to other countries. 

So, for example, the lack of a wide-range audience measurement tool is a big problem. There is also investment going into ad tech, but it's not coordinated and there's a lot of duplication which could be done much more efficiently. There is also not a strong enough partnership relationship with municipalities, whereas in other markets they operate as stakeholders very effectively together. 

And importantly, there isn't a clear roadmap for sustainability. There's also a noticeable lack of collaboration between the media owners and agencies.

5. How can we tackle these issues? 

The big first step would be for the ethical and progressive media owners to come together to work on a strategy to start fixing these issues. Consolidated markets usually earn a fairly better OOH AdEx like Switzerland has 8.6% of AdEx towards outdoor. Similarly, France and Germany markets garner 7.8% and 7.6% of the same respectively.  

A very important element of that would be to put more support behind the Indian Outdoor Advertising Association (IOAA), the National Trade Body. There are too many trade associations in India currently. My philosophy is there should be one big association that everybody supports.

Let's take Australia. They formed a trade association there called the Outdoor Media Association (OMA). Almost 100% of the industry are members of that association today and what does that mean? That means they have the funds and the staff to invest in the common tools that we all need to grow the market. 

Additionally, there should be a much higher proportion of media owners as members of IOAA. The IOAA can more efficiently implement things like audience measurement and common standards.

6. According to you, how well has India adopted the digital OOH and what is the area that the country is lacking in?

Bear in mind is that large format digital screens are big ticket items in terms of cost. And because the OOH industry in India is taking a lower share of AdEx, the CPMs in India are very low. So, it's difficult for media owners in India to develop these expensive large-scale screens because the margins here are not as attractive as they are internationally. 

If the industry here addresses the issues I mentioned, like audience measurement and common standards and works together to reduce fragmentation, that would allow more investment in digital anamorphic. It's a bit of a chicken and egg situation.  

7. Which sectors/brands are investing the highest in OOH as of now in India?

In India, Amazon is a huge brand. People often describe OOH as the media's favourite medium. Media owners really love Out-of-Home. 

Also, if you look at digital, up to maybe 10 years ago the top fashion brands didn't invest a lot in OOH because the quality wasn't there. Fashion brands need to have high magazine colour reproduction. With the arrival of these high-resolution digital screens now in the rest of the world, 19 out of 20 fashion brands are now using Out-of-Home. 

8. A unified measurement system is long awaited by the industry. There were also chatters of RoadStar going for a pilot test. When do we see that reaching every OOH player?

Kudos for putting this initiative in motion. I don't know any audience measurement tool that's been developed around the world that didn't hit bumps in the road. It's by the nature of it.  

The OMA decided in 2010 to build an audience measurement tool which they called MOOV and it took them four years to get through all the bumps. They could do that because they worked with the brands, the media and the agencies to come up with an audience measurement system that had integrity and efficacy. 

The important thing is that the brands, the agencies and the media owners work together and agree on a tool that has the right efficacy and is accepted by the brands. During that process, they may have to face positive friction because the brands want to make sure that they can justify it to their CFOs. So I would regard this as teething difficulties.  

Nevertheless, having the initiative started is to be applauded but there's a long way to go. 

9. How much growth do you foresee for the OOH sector in India? And what are other hurdles that at this moment the industry needs to take care of?

There are just too many inventories in existence and hence, it needs to move to a ‘Less is more’, quality rather than quantity position. 

But the main thing that's going to move the industry forward is coming together and having a vision for OOH. Today, the situation is such that 60% of ad spend is going towards online globally. The 40% is going to the legacy media operators.  

Now in the legacy media operators, OOH is the only one that's growing not only in real terms, but also growing in share of AdEx. The other legacy media are losing share of AdEx and that's because we're embracing, modernising and investing in the digital world.  

In some markets like Australia, and the UK, digital penetration accounts for nearly 80% of revenues. Even the average is in the 30s range globally, whereas in India, it's only 9%.