Ramu Ramanathan
Jan 03, 2012

Opinion: OOH: In search of transparent rates and metrics

Is the case for billboards overstated, asks Ramu Ramanathan, group editor, Haymarket Media India

Opinion: OOH: In search of transparent rates and metrics

Roadside and transport account for a lion’s share of the ad spend. In India, the estimated size of the OOH industry is Rs 15 billion in 2008, which is projected to become almost twice its current size in 2013 (i.e., Rs 25 billion). Its share in the total ad pie is expected to go down marginally to 6.8% in 2013 from a current level of 6.9% in 2008.

There are two schools of thought about Out Of Home (OOH).

One view states: OOH advertising has a rosy future. Most research studies and surveys agree that OOH advertising pays.

The contrarian view is: Most young people look at their phones and iPads and not at billboards. The rest are listening to music on their iPhones. And so, is the case for billboards overstated?

OOH at India’s airports

Look no further than the airports; and one can see why OOH could be so powerful.
The cost per thousand (CPT) at Delhi, Mumbai, Bengaluru and Hyderabad is high. The new airports have been privatised and renovated; and are world-class airports. Hyderabad is rated as the best airport in the world in 5-15 million passenger capacity. Delhi has global ratings among the top few in the world.

We spoke to the media owners who own space in these airports; and we were told, “An airport is a destination for ambient advertising and it is needless to say that in advertising ‘ambience’ of the given destination is the key. It justifies the premium. The modernised airports provide clean, scientifically illuminated and hygienically maintained environment which are consumer friendly.” Delivering a message to an audience so pampered and delighted will have its premium. But it is this kind of relaxed and indulgent audience “in a celebratory state-of-mind” that is the dream of every marketer and advertiser.

The point is, how do you qualify the value of ambient advertising? How does one evaluate the ‘response’ and the ‘effective CPT’ for these airports?

IOAA meet at Campaign india office

It’s to understand this that Indian Outdoor Advertising Association (IOAA) is endeavouring to set standards for the OOH industry.

We’re hosting an initial meet at the Campaign India office in order to understand measurable standards. Indrajit Sen, executive director, IOAA will discuss maintenance and measurement of displays in OOH space and its operational processes. This will be followed by a round-table closed-door discussion with clients and marketers about their expectations from the OOH media. Pawan Bansal and Noomi Mehta will be a part of these deliberations.

The challenge is to understand: ROI for OOH,  the metrics and indicators, rates and commissions it brings in; and then implement standard operating processes.

Consider looking at a building and seeing a billboard? The value of roadside billboards is astonishing to market advertisers to the point where many local and state governments in India could make a killing by ensuring transparent billboard licensing. Healthy profits can be made from OOH advertising in this regard; both by governments and advertisement agencies.

And finally, one has to understand the cost structure. Already we’re seeing a drop in hardware cost and improvement in application (the HPs and Vuteks of the world), which should enable OOH to dominate spends. In 2012, we can see some amazing trends appear and retail branding getting a boost.

Ramu Ramanathan is group editor, Haymarket Media India

Campaign India