Last year, the South African out-of-home (OOH) advertising market was valued at R4.3bn by PwC's Entertainment and Media Outlook: 2015 - 2019 (South Africa - Nigeria-Kenya). While the future looks bright for OOH, there are two major challenges that the industry will have to overcome if it is to reach its full potential: the regulatory environment and the need for a credible measurement system and research.
A significant sector for the advertising market, outdoor media, in particular billboards, is subject to increasing regulation. The rights issue and media owners' struggle to secure quality, legal rights through the prescribed processes has remained an issue.
A major challenge, with a doubt, says Dinesh Diar, CEO of Ad Outpost, is the constant harassment media owners receive from authorities. He says common sense and genuine leadership from authorities is needed.
"Media owners can play such a vital and important role from a revenue perspective for local government. In fact, on a daily basis we experience service delivery protests from communities that are still not receiving basic services after 20 years of democracy."
As a media owner, he asks why local government does not engage them more and form partnerships so that they can, as an industry, contribute towards solving social problems. "We can be a source of revenue that can help build toilets, facilitate running water, etc. Instead, we are confronted on a continual basis by officials that do not have any notion of how their sometimes bully mentality and actions affect people's lives."
Jacques du Preez, MD and founder of Provantage Media Group, adds his voice: "We want to see far more mutually beneficial OOH and government initiatives, but often government departments and municipalities are totally uneducated about OOH and view us simply as billboard operators. We have far more success with private landlords and parastatals such as ACSA."
This issue also impacts on clients as all the elements involved have to be aligned and on line with the client's timelines. "This is extremely difficult just based on the fact that there are so many different parties involved in the process," says MD Brett Tucker, who recently founded and heads up Relativ Media.
OHMSA's chairman Peter Lindström sees this challenge, coupled with the financial gain of operating outside the law, as an issue that will cause much disruption in the OOH landscape in the coming months and year. "OOH shareholders will need to work closely with local government authorities in order to achieve consistency in how OOH, especially roadside billboards, is regulated in towns and cities."
A bigger challenge facing OOH media owners is an efficient research and measurement system. "Measuring their audience and therefore the success of a campaign has been an issue that the OOH industry has been struggling with for many years," says Lindström.
Taryn Naledi Hood, executive: marketing, Primedia Unlimited, Mall Division, says that without a standard methodology and research study to aid media planners and strategists, it's very difficult to plan using the medium with much certainty for success.
She adds that while Out of Home Media South Africa (OHMSA) is working on real OOH measurement solutions using new technology, there is still a real gap in the number of case studies, white papers and agency-driven modelling research locally to really build the case for OOH.
"The lack of local research and case studies that marketers and media strategists can draw insight from means that leaves local teams having to infer correlations with studies completed overseas and in environments with very different demographics, geographics and economic dynamics."
Du Preez says that big data will play a big part in the methodology and measurement matrix of OOH media research. "The result will be more and more unique OOH communities and audiences with very clear demographics becoming available and this will enable advertisers to really focus their budgets and messaging."
He adds that this will eliminate a large amount of the wastage and make OOH more valuable and more expensive as OOH companies deliver better research, captive audiences (which is becoming a very rare commodity) and better quality OOH media types.
The research issue is moving swiftly to a solution in 2016, says Lindström, with the Outdoor Measurement Council (OMC) having made some solid progress in bringing a quality tool to the market for the planning of OOH across static platforms that the market should see this early into 2016.
"If I look into my crystal ball for 2016, I believe that the launch of the OMC planning tool will greatly strengthen the argument for OOH into the media mix. This will provide advertisers with a great place to spend the rands that are returning less and less performance on the likes of TV and radio as media inflation, coupled with declining audiences, make these mediums less productive within the overall strategic performance of any marketing plans."
As OOH research becomes as sophisticated and available as is the case with other media channels, this will again drive significant growth for the medium.
The new research tool for the industry has made significant progress in 2015. The tool's methodology created by Ask Afrika and the Spanish company Cuende Infometrics, can combine traffic flow and patterns to create a traffic model. This is then overlaid with the location of billboard panels to offer a detailed representation of OOH audiences in key areas. Such elements are then modelled to create ratings for reach, frequency and cost per mille (CPM), among others.
PwC's Entertainment and media outlook: 2015 - 2019 (South Africa - Nigeria-Kenya)(PwC Outlook), reports that the "possibility of credible, consistent data should provide a major boost to the industry". It states that "in particular, knowledge about those sites seeing the most consumer attention should help industry players to ascertain where to convert to DOOH, in order to exploit the enhanced opportunities for interaction provided by that medium."
This project's creation has also spurred the formation of a new measurement body, the Outdoor Measurement Council (OMC). The body is a legal entity and in March it became an official non-profit company. The brainchild of Terry Murphy, Primedia Outdoor marketing and marketing services executive, and Lyn Jones, marketing manager at Continental Outdoor, the two were tasked by the industry to investigate a measurement system for the entire OOH industry.
