Outdoor advertising in India is an extremely fragmented and disorganised business. There are no official figures available, though out-of-home - comprising billboards, mounted vans and airport media - is estimated to be a Rs 2,000-crore (US$509 billion) industry, and expected to more than double to Rs 5,000 crore in the next three years. And a lot of this category growth is expected to be fuelled by digital signages, which has just started becoming popular in India.
1 “The current value of digital outdoor is not very high at around five per cent of the entire Indian advertising industry. But in three years’ time, if the ad industry grows to Rs 25,000 crore, digital will be worth Rs 1,300 crore,” says Ishan Raina, director and CEO, OOH Media, a year-old start-up which has been funded by private equity player 3i, and has China’s Focus Media as its strategic partner.
2 The pace of growth and market potential can be measured by the manner in which OOH Media, within a few months of launching, acquired rivals AdImpact and Flash networks. Says Raina: “It made sense to acquire them, rather than compete.” CVL Srinivas, CEO of Surewaves, says the company started with a relatively smaller kitty of $10 million. “But as time passes, we will need bridge funding to move ahead,” he admits.
3 Digital outdoors in India is largely in-store. Which explains why Kishore Biyani’s Future Group got into the fray with Future Media, the first retailer-owned media company in the country. Future Media offers Future TV (an in-store TV network), Future Radio (different radio stations play-out in different retail formats) and Future Theatre (which has on-screen media rights of the Inox chain of multiplexes).
4 Digital outdoor targets people with high spending power and are tech-savvy to boot. Surewaves allows its clients to engage with customers using mobile phones. Its 42-inch screen has a combination of content fed on it; like videos of shops in the malls, offers at these stores, a commercial and current news relevant to the area/mall/product. The solution also allows customers with Bluetooth-enabled phones to download the Surewaves application and get relevant content. “Users within a 10-km radius can get information being displayed on the digital screen on his mobile,” explains Srinivas. Surewaves has about 10 to 12 pilot projects running and three confirmed deals.
5 OOH Media has a network of 4,000 screens across 20 cities, and boasts of 60 clients. According to a research conducted for a confectionary client by OOH, 100 per cent of respondents claimed to have notice the SMS facility, and 46 per cent of them could recall the correct SMS. “Clients are sceptical right now; budgets today vary between Rs 10 lakh (US$25,000) to Rs 55 lakh. But many clients like Hindustan Unilever and ITC Foods are coming back.” Partho Dasgupta, CEO, Future Media, says the greatest USP of digital is the ability to target consumers with purchasing power. “This includes consumers who may not fall into a brand’s typical SEC classification, but still hold significant buying power.”
6 Indian advertising veterans are also watching this space with interest. Sam Balsara, chairman, Madison Communications, warns that digital outdoor still has a long way to go. “Digital screens, if intelligently placed to target a certain homogenous audience and engage in a dialogue with them, will be a step in the right direction,” he says. Indrajit Sen, CEO, Stroer India, shares his point of view: “What we are trying to develop is a combination of social networking, mobile convergence, Bluetooth, and so on. We are also trying kiosks fitted with webcams, which can display ads and be downloading route maps,” he says.
7 But Raina thinks the medium may be in danger of getting overhyped. “What clients buy is reality and not hype. All these announcements of grand plans itself is hurting the medium,” he feels. The next two to three years will provide a clearer picture, both on the robustness of the medium, and the eventual outcome of the battle for the advertiser’s money. Chances are it’ll take the entry of at least a few more players - and experimentation with a few more business models - before the category rationalisation sets in.
What it means for…
Advertisers and agencies
-Be willing to experiment with the new formats available to see what resonates with the target audience.
-Think interactively. The true power of digital outdoor comes from harnessing its interactive elements, whether that is relevant commercial content or downloadable route maps.
-Understand the audience: largely affluent, but not necessarily within a brand’s typical target demographic.
Media owners
-Up investment. Digital outdoor players risk falling by the wayside if funding does not improve. For a nation where retail is poised to boom, the opportunities are clear.
-Observe other countries - in particular China, where digital outdoor has made Focus Media the nation’s largest media company.
