The year 2009 was one filled with mixed situations and emotions for the out-of-home industry. Lack of proper accountability and measurability resulted in this medium being one of the worst hit amidst the slowdown.
As per industry estimates, in the first three months, advertising spends on OOH had shrunk by almost 35-40 per cent, especially from sectors such as financial services, which contributed significantly to the OOH advertising industry. The slowdown also resulted in a rationalisation of bid prices in the market, with some long-term properties not finding any takers.
The GroupM India Media Market Report 2009 estimated that the outdoor industry clocked in Rs 1,448 crore in 2008, and the industry was expected to grow marginally to Rs 1,506 crore in 2009. However, industry observers admit that the business for the OOH industry was even less than the previous year, forget about the growth. Madhuri Sapru, managing partner - South Asia, Kinetic & Dialect estimates that the OOH industry had done a business of Rs 1,300 crore in 2009 - a dip of 10 per cent from 2008.
Though, she clarifies that this does not include retail screens and formats, else the industry size would be a little larger.
But not everyone seems to agree with this theory. Pratap Bose, chief operating officer, Mudra Group is quite optimistic that the industry has performed much better than it was expected in 2009. He says, "The industry expected the worse in 2009. But the truth is that it wasn't as bad. In fact it was better than the previous year - 2008 - in terms of business.
The biggest saviours for the OOH industry in 2009 were the telecom brands with a contribution of around 40 per cent. Banking and Financial Services contributed to around 15 per cent, while entertainment and media, too, contributed to about as much. FMCG hovered around 5 per cent; while automobile advertising's contribution was a little less than that of FMCG.
Brands such as Vodafone, Airtel, Aircel, Loop Mobile and Tata DoCoMo launched pan-India outdoor campaigns on a large scale. Bose points out that with more players such as Datacom, UniNor and UAE-based Etisalat yet to launch, these will solidify the state of the industry and grow the market further in the coming year. Additionally, with number portability in the offing, OOH spends by telecom players are bound to increase.
Commenting on what makes OOH so attractive for telecom, Pradeep Srivastava, chief marketing officer, Idea Cellular, says, "There are two sides to this. First, telecom frequently offers new products and services and price offerings keep changing - these need to be regularly communicated. Also, since many of these offerings are targeted at specific geographies, OOH becomes very relevant to announce these local services. Second, significant spends go into national thematic campaigns like 'Walk and Talk'; and we like to constantly supplement these with OOH as a reminder medium."
But he offers a word of caution to outdoor media owners, saying that the next potential markets for the telecom players are in the feeder towns. However, there is not enough authenticated OOH to deliver campaigns in such areas where the only available outdoor formats are wall paintings or posters. "I'm going to communicate where my customer is, and not only where the infrastructure is present. Going forward, I think this will be a challenge for the medium," he says.
In 2009, while many outdoor-savvy brands were missing in action, innovative ways were tried for movie marketing. Attractive campaigns and interactive platforms were launched for movies such as New York, Agyaat, Night at The Museum 2, and recently, 3 Idiots, Paa and Avatar.
Not only movies, innovations in OOH were also tried by several other brands especially from the telecom sector.
A hot favourite amongst the creative folk this year was the Aircel Lifeboat hoarding, which was launched in the monsoons. The lifeboat could actually be taken off the hoarding to be used when needed.
Santosh Padhi, chief creative officer and chairman/partner, Taproot India, says, "I think this was a phenomenal idea. It was not just communication, but it connects with the audience. It is truly a new-age idea that went beyond just communication and was appreciated by many."
He points out that Nimbooz from the PepsiCo stable had launched multiple innovations as well around its launch and the effort was tremendous; but no other outdoor campaign made a mark as did Aircel.
Mukesh Manik, man-in-charge, Encyclomedia Networks, reiterates, "As a one-off OOH execution, the Aircel lifeboat was the most memorable, well strategized and executed OOH activity."
Another telecom player, Idea Cellular launched a 'walking lights' LED innovation on gantries and bus shelters for its Walk and Talk campaign, which also made a mark.
Camlin's 'Really Permanent' mobile van innovation in the metros -- which had mechanical men trying to wipe off the words 'really permanent' -- couldn't be erased from commuters' memories easily either.
Vodafone went the Hollywood way by setting up a huge 'Vodafone' sign among the hills in Rajasthan. Sprite also wowed audiences with its innovative in-tunnel Sprite Xpress campaign at the Delhi Metro, where frames of the ad were placed one after the other. When a train passed it, the ads seemed in motion, much like a flip book.
The industry also witnessed new OOH media formats being introduced or reintroduced in better ways. Many OOH formats, which were not getting their due share of the pie, saw wider and more frequent acceptance with advertisers, mainly because of reach and cost-effectiveness in the time of slowdown. Some of these were: taxi advertising, better packaged airport advertising, and newly constructed, aesthetically pleasing billboard structures.
The industry also saw the growth of digital, with a number of billboard-sized LEDs and other outdoor screens being launched in metros such as Delhi and Bengaluru. As part of digital, 3D ad screens were also seen in a number of campaigns.
Ishan Raina, CEO, OOH Media, says, "The sector's performance was affected in the second half of the year, owing to the overall economic slowdown. Digital OOH TV grew by less than 25 per cent in 2009, after trebling in 2008, due to price erosion. The hope is that 2010 will again see at least a doubling of revenues in this sector."
Another significant achievement for the industry, last year, was the launch of the Indian Outdoor Survey (IOS) - unveiled by Media Research Users Council (MRUC) and Hansa Research. Even though, the research is still at a nascent stage as it covers only two cities -- Mumbai and Pune, and doesn't include outdoor formats such as airports and railways, the industry still appreciated it as a step in the right direction.
"The IOS launch, to my mind, was the most important event for the OOH industry. Results were encouraging. And a 66 per cent reach, equivalent to the press' 67 per cent reach, means that in a comparative situation, a marketer can reach equal number of TG in half the cost through OOH," states Nabendu Bhattacharyya, founder and chief executive officer, Milestone Brandcom.
However, Bose of Mudra Group says that the IOS hasn't yet been able to create impact. "I don't really see the industry using it yet."
In 2009, especially mid-year onwards, many new ventures saw the light of the day. In May, media owner, Shlok Media launched its agency, Square Circle Outdoors; while Posterscope brought its OOH specialist agency, Hyperspace (which has presence in eight countries) to India with a bang. Mudra, too, rolled out an OOH unit, StreetSmart, in June. This was in addition to the existing Primesite. Ogilvy India's Nabendu Bhattacharyya set up OOH agency, Milestone Brandcom, in October.
Ashish Pherwani, associate director, media and entertainment, Ernst & Young comments that the launch of new agencies in this sector was the need of the day. He points out that after the exaggerated exuberance of 2007-2008, the rationalisation in rates across OOH media made the medium increasingly attractive to many advertisers. Further, street furniture and transient media were relatively new formats that began to generate interest. Clients needed guidance in using these formats. In such as scenario, the need for specialist OOH agencies could have never been higher.
"When the OOH sector is on a rebound and several new formats are being made available," he says.
However there is also counter point of view on this trend. Many industry practitioners feel that new ventures are just a flash in the pan. A few of them also feel that the entry of newer players did little to create a difference in the industry. Mukesh Manik of Encyclomedia, says, "Most of the new ventures launched in the OOH space were in the media buying space. The OOH share of the advertising pie is still the same. And with more media buyers entering the market, it does not necessarily mean that the business would grow as well."
Amongst other significant development in 2009, according to Symbiosis Advertising's director, Mangesh Borse, was the improvement in the look of outdoor across the country's major cities, thanks to the revised policy guidelines by the authorities. "New unipoles, bus shelters and bipoles transformed the looks of cities. In fact, in spite of the slowdown, some media owners have invested considerable sums in beautification."
Street furniture such as utilities, pedestrian bridges, bus shelters, info kiosks and metro rails displays gained importance during the year. Many new street furniture and innovations on these were set up, not just in the top metros, but also in places such as Chattisgarh, Mohali, Indore and Gwalior.
On how OOH performed in 2009, Sapru of Kinetic & Dialect shares that the biggest focus for OOH has been on how to reduce costs for the advertiser. "How important OOH is for an advertiser lies with what the objective of the campaign is and under what circumstances the advertising is being done. Therefore, for local advertising, like retail stores, and also for high impact advertising as done by telecom, outdoor continues to be a focus media. These principles haven't changed at all in 2009. But due to the global slowdown, spends have slowed across media and this is true for OOH as well. This year, the focus has been to try and ensure effective advertising for the client," she says.
Looking forward: 2010
Bose's forecast for 2010 is that the year will be much better than 2009 and will witness the full impact of telecom. Manik estimates that the industry will see a growth of 10-15 per cent in the coming year.
Bhattacharyya is highly optimistic, predicting that in 2010, the industry will clock a growth over 20 per cent. He says, "I strongly believe authorities will impose strict control over OOH formats and media; marketers will demand ROI based planning; hence, IOS will see the light of day with 11 cities' study. Further, international players will take greater interest in India; hence, technology and production techniques will flood the marketplace."
As the saying goes, when you've been down, the only way to go is up. It truly seems that this is the general feeling amongst the outdoor folk, with cautious optimism being the key word.