The outdoor advertising industry is finally heading towards recovery, with industry players expecting 2022 to mark its revival. Four months into 2022, the recovery of the OOH (out-of-home) segment in India has been substantial, with citizens and vehicular traffic returning to the roads. According to a recent Pitch-Madison report, OOH advertising saw billings of a good
3,495 crore in 2019, followed by the 2020 slump where it fell to1292 crore, with some semblance of recovery in 2021, at
2,178 crore. The report estimates this figure could touch2,955 crores in CY22.
Imtiyaz Vilatra, Country Head of Posterscope India, notes that brands in the fintech, e-commerce, OTT, real estate and hyperlocal services categories are currently the big spenders on OOH advertising. Other categories watching this space closely are automotive, mobile handsets, consumer durables, IPL teams and technology companies. Some of the factors driving the industry’s growth are increased consolidation among media owners and increased adoption of relatively higher-end digital OOH properties.
Technology leads the way
According to Atul Shrivastava, CEO of Laqshya Media Group, the OOH segment could see 12-15% growth in FY23, compared to pre-Covid levels. “At Laqshya Solutions, we expect to reach pre-pandemic levels in the first quarter of FY23 itself, and we envision an ecosystem where we can sell 80-90% of our inventory,” he adds. .
The pandemic has pressed the reset button in the industry, encouraging investment in technology-driven media measurement in OOH. This pivot worked. “There has been considerable investment in technologies such as large format outdoor screens and curved screens, providing experiential communication, which sets OOH apart from other media,” observes Satyen Sharma, Manager, OHM, Ormax Media.
In CY21, digital screens have increased from 55,000 to CY20 to 60,000, according to the recent Pitch-Madison report. Digital external spending has also increased to reach
300 crore last year, up from50 crore in 2020. However, while digital OOH in India holds a share of 13.7% in the total outdoor advertising segment, it is still well below the corresponding global average of 40%.
The process of outdoor advertising recovery will be on new ground, as the pandemic has shrunk the industry to nearly half its size in 2020. Industry experts say OOH has seen a massive drop in 50-55% in the first half of this year when the pandemic hit, while 2021 saw a 69% increase in outdoor advertising revenue, although the industry was still below pre-billings the pandemic.
While several OOH players are confident that the industry will reach pre-pandemic levels during CY 2022 itself, Sanjeev Goyle, CEO, OOH and Rural, IPG Mediabrands India, remarks that the industry will not experience no full recovery until FY24. Regardless of the pandemic, an advertiser typically allocates a smaller fraction of the advertising budget to OOH, so limited budgets are definitely a major challenge,” he points out. He expects the sector to grow 20-25% this year – that is, to reach 70% of pre-pandemic levels – assuming there is no disruption to Covid. Rural markets will also play a key role, with a rebound in consumer demand and good monsoon forecasts this year.
In CY21, up to 70% of OOH spending took place in the second half, with the last festive quarter accounting for 41% of spending for the year. While the conventional OOH market grew 63%, transit media grew nearly 100% in CY21, growth attributed to increased passenger traffic at major airports across the country.
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