Hoarding Country
THE GREAT INDIAN OUTDOORS

By: Rajiv Raghunath             Dated: November 01, 2014

Brands rediscover the OOH magic as outdoor media asset owners and specialist agencies seek to innovate and evolve

The Indian out-of-home (OOH) industry is gearing up to deliver greater value to advertising brands by ushering in new-generation communication and display technologies. Of essence here is innovation, which is not limited to the traditional cut-out on a billboard. The OOH medium is now seeking to unshackle itself from the ‘reminder media’ tag to become the preferred advertising medium for diverse brands.

The OOH industry accounts for roughly 7 percent of the overall advertising spend in the country, though the current trends suggest that its share of the pie could increase in good measure over the next 4-5 years. Providing a positive spin to the OOH growth story, Pramod Bhandula, Managing Director of JCDecaux India, the Indian arm of the global outdoor major, JCDecaux, observes that the Indian OOH industry “is poised to increase its share as more and more people are spending most of their time out of home”.

Bhandula says while this industry is lagging behind digital and electronic media, there are clear indications that it has recovered from the freefall following the economic slowdown that began in 2008. But to accelerate its pace of growth, the OOH industry would have to make a conscious effort to come out of what Sunder Hemrajani, Managing Director of Times OOH, describes as the “commodity trap”.

Hemrajani observes that the majority of outdoor media asset owners opted for massive price cuts in the slowdown period, thereby diminishing the industry’s capacity to deliver good value to advertising brands.

Innovation is a must in the OOH space. We have been able to provide impactful solutions for our clients via some outstanding executions...
Pramod Bhandula
Managing Director, JCDecaux India

This was also the time when India’s physical infrastructure sector expanded, creating in its wake a large number of outdoor media assets. Supply of media assets outstripped demand for the medium, which in turn exerted significant downward pressures on the bottomlines of OOH companies.

By 2009, the OOH industry got back on the path of recovery but the billboard segment could barely extricate itself from the commodity trap. Fortunately, segments such as transit media took off. Times OOH was quick to capitalise on the transit media boom. The OOH firm, which is an arm of the Times Group, acquired rights to marquee assets, such as the Indira Gandhi International Airport (IGIA), New Delhi, Chhatrapati Shivaji International Airport, Mumbai, DND Flyway, and several stretches of Delhi Metro, among others. Likewise, JCDecaux India won the advertising rights at the new Bengaluru International Airport and made forays into segments such as Delhi bus shelters which command premium value.

With exclusive media assets like modern airports coming on the scene, the OOH industry was set to surpass the high growth levels achieved in the immediate years preceding 2008. However, negative developments, such as the series of high-profile scams that hit various sectors, inhibited the industry’s growth. Nabendu Bhattacharyya, Founder & Managing Director of OOH specialist agency Milestone Brandcom, which has grown admirably since inception in 2009, says the recent spate of scams has had an adverse impact on brand advertising, especially in the OOH domain. Telecom brands that contributed nearly 40 percent of overall OOH spends reduced their share to a mere 10-11 percent. Advertising categories like the Banking, Financial Services and Insurance (BFSI) sector also cut down their outdoor presence.

WINDS OF CHANGE

But the situation is changing. Nimble firms, such as JCDecaux India, Times OOH and Milestone Brandcom, are now looking to bring new brands into the OOH fold, although some brands are averse to trying out the medium as it lacks a common currency for audience measurement. Bhattacharyya says that media planners leave only the “leftovers” from their advertising budget for OOH campaigns as there are no commonly accepted metrics by which they can demonstrate the returns on investment (RoI) with regard to OOH advertising.

This challenge is compounded by the prevalent business sentiment. Bhandula echoes this view. “In the existing market conditions, most brands are looking for RoI-driven activities in an uncluttered environment,” he says, adding that the absence of credible measurement metrics is a key constraint for the industry. Fragmented ownership of media assets and poor implementation of outdoor norms laid down by civic bodies have also kept a sizeable number of brands from entering the OOH segment.

To circumvent the issue of measurement, firms, such as Times OOH and Milestone Brandcom among many others, have invested in developing their own planning and measurement tools. “We are working on a few measurement platforms. With these tools we will demonstrate to our clients how OOH has helped improve top-of-the-mind recall of their respective brands,” says Hemrajani.

However, OOH advertising is also about giving brands a larger-than-life presence, which can be achieved through innovations. “Innovation is a must in the OOH space,” says Bhandula, adding, “we have been able to provide impactful solutions for our clients via some outstanding executions, such as the IBM and Yahoo iconics at the Bengaluru International Airport, and roof-top brandings on bus shelters for Citibank, Reliance Communications, Airtel and many others.

The opportunity for growth lies in helping brands connect with their consumers through brand awareness, engagement, and experience. A controlled environment such as the one in an airport is cut out for this...
Sunder Hemrajani
Managing Director, Times OOH

Innovative displays for clients such as Dabur and Volkswagen have also created a lot of buzz for these brands.”

At the same time, Bhandula believes that innovation needs to be understood in a broader context. “Innovation needs to brought about through self-regulation; industry has to devise innovative ways of mobilising resources and attracting good talent to join the OOH domain; industry must initiate dialogue with city administrations and state governments to introduce regulations and laws for the OOH operations; the stakeholders must create more street furniture infrastructure in the cities that combines both functionality and commercial advertisements,” he says.

For Hemrajani, the opportunity for growth lies in helping brands connect with their consumers through “brand awareness, engagement and experience”. A controlled environment such as the one in an airport is cut out for this. For instance, an ultra-modern terminal like T3 at IGIA lends itself to displays of high-end brands and cars. Several top-end car brands have generated useful customer leads by displaying their car models at the airport, says Hemrajani. Likewise, some real-estate firms have also displayed building models at the airport to attract top-end customers with a good measure of success.

“We are indeed in the business of ideas, so creatives matter a great deal,” says Bhattacharyya. Milestone Brandcom closely focuses on developing OOH-specific creatives for its clients unlike many OOH agencies that are happy to “cut and paste” print creatives on the OOH canvas. “We have created a culture of creativity in our organisation” he says.

Bhattacharyya is also cognisant of the significance of adopting new technologies in the OOH space. The firm is using sophisticated data capture systems to develop qualitative inputs for clients. As 4G technology penetrates urban markets, more people will use their personal devices to consume advertising content. The OOH industry will need to keep pace with these developments, he says, adding such paid touchpoints will become increasingly important for advertising brands.

Digital technology is expected to spur OOH growth in the coming times. “Digital is undoubtedly the future but currently its progress is slow,” says Bhandula. But in controlled environments like those of airports, digital media assets are already serving as key differentiators. Times OOH has set up video walls at IGIA. It has also set up a network of digital screens that command high visibility. “We have got the content right,” says Hemrajani, adding that Times OOH is also experimenting with technologies such as QR code, augmented reality (AR), and motion technology, among others.

These firms are also undertaking a major overhaul of their internal processes and practices to strengthen their customer engagements. Bhandula says that JCDecaux has been striving to introduce global best practices in terms of both projects and operations in the Indian OOH domain. “We have been able to attain considerable success in our business with the support of our principals, brands and agencies,” he says.

We are indeed in the business of ideas, so creatives matter a great deal. We have created a culture of creativity in our organisation...
Nabendu Bhattacharyya,
Founder & Managing Director, Milestone Brandcom

Likewise, Times OOH has focused on building capabilities within the organisation to deliver the right solutions to customers. “People are our key differentiators,” says Hemrajani. Bhattacharya too holds a similar view.

With increasing focus on creativity, innovation, best practices, and right skills and knowledge, the Indian OOH industry is attracting many more advertising categories, including online retail platforms. Categories such as telecom, BFSI, media and entertainment, real estate, FMCG, consumer durables and local retailers are also likely to increase their outdoor presence in the coming times.

The OOH industry is increasing its business in the Tier 2 and 3 cities where occupancy rates now hover in the 80-90 percent range, which is considerably higher than the 60-70 percent range in the metros. The industry is growing at 15 percent year-on-year.

Improved industry regulation, some degree of consolidation of business, and continuous innovation will help the industry double its share of the advertising basket in the near future.

Watch this space!

Rajiv Raghunath

Rajiv Raghunath
Founder & CEO of Wellversed Media

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