And, on the flip side, the notorious traffic snarls that bring
regional capitals to a standstill only means there's a bigger audience
out-of-home, just one of many factors behind outdoor's unprecedented
expansion.
The lay of the land of Asia's vast urban outdoors is changing rapidly as
ambient media vendors put expansion of networks and product improvements
in top gear in the hope of diverting a greater share of budgets to the
medium.
Few could put a figure on just how much is being poured into
infrastructure expansion. But it's safe to say that the Asia-wide tab
could run into the high multi-millions in US dollar terms.
The pace and scope of the latest expansion drive is unprecedented. It's
happening on the transportation front, at point-of-sale, leisure and
entertainment outlets, roadside and in public institutions such as
hospitals, libraries and universities. Vendors have been upping the ante
with each product launch, rolling out offerings that technological
improvements have made possible, including one innovation which promises
to take trackside advertising to the next level.
If there's a silver lining in the technology bust, it's the boost it's
given to the expansion efforts of outdoor vendors. LED displays now cost
a third of their original price, making it a bargain for vendors to
replace standard billboards with them, according to Kam Ling, chief
executive of Hong Kong-based MediaNation, the holding company for Top
Result.
At the same time, the maturing of markets in the West as well as
Australia has led international operators to raise investment in Asia's
outdoor business. The latest to grasp regional opportunities is
Australia's APN News & Media, which has set up a Singapore company
called Asia Posters as part of an aggressive Asia-Pacific expansion
push. This is on top of a string of new ventures - the setting up of the
joint-venture Universal Outdoor in Thailand, an investment in Malaysian
outdoor company Kurnia and the launch of Taxi Media in Singapore through
a joint-venture with City Dreams.
Says Asia Posters chief executive John Smallwood: "We have 75 per cent
of the outdoor market in Australia so we've reached the stage where
there are few growth opportunities." Smallwood, who refers to Asia as
the "last frontier", adds: "Asian expansion is part of a long-term plan
for us because some of these opportunities will take some years to come
to fruition." He expects the industry to consolidate as international
operators - JCDecaux and Clear Channel - acquire smaller players.
Others predict consolidation is still years away, but point to strategic
alliances as factors driving outdoor's expansion. "The major phase of
consolidation has yet to come to Asia-Pacific, but consolidation in the
West means that the bigger players in the region now have the resources
to expand their networks," says CCP's Singapore-based managing director
Peter Kemeny.
JCDecaux Pearl & Dean managing director, Peter Christofis, adds: "The
outdoor market has grown significantly in the last two years because of
the emergence of other forms, which is a great thing. When there is more
outdoor, it allows advertisers to look at the medium in a more
top-of-mind way. They can think of outdoor as a whole medium.
"With all the facets we now have, advertisers can do a very strong
campaign using just outdoor. Whereas some years back, it was TV, print
and what else."
With the exception of a trio of market laggards, innovations and
expansion are evident from Shanghai to Singapore. Kelly Clark, MindShare
Asia-Pacific chief executive, blames disorganised selling practices and
poor infrastructure for holding the industry back in Thailand, Indonesia
and the Philippines.
But he says the industry is growing impressively in Hong Kong, Malaysia
and Singapore.
Outdoor vendors in Singapore have perhaps been among the more
enterprising in maximising opportunities to further develop outdoor
infrastructure.
By December, JC Decaux Pearl & Dean will unveil plasma screens at the
city's train stations. It will intersperse advertising with information
on train arrival times to ensure commuters pay attention to it video,
minus audio, footage, according to marketing manager Helena Paoli.
At the same time, rival operator CCP Adshel is bumping up capacity
significantly after snagging a 15-year contract for transport shelters.
It will spend S$100 million (US$57 million) over the next
three-and-a-half years upgrading and installing illuminated panels to
3,120 bus and 80 taxi shelters.
The company has also turned the humble bicycle into a conservation hero
and an unexpected advertising medium. Under the SmartBike scheme -
touted as a significant contribution to the city's green plan -
residents who sign up for the service enjoy free use of sponsored
bicycles in their neighbourhood. The scheme's launch sponsor Singapore
Telecommunications has since agreed to raise its first year investment
of S$50,000 to $250,000 next year. CCP's Kemeny says the
SmartBike scheme has been positively received - an independent survey
found that 94 per cent of residents in the launch neighbourhoods were
aware of the scheme's existence and 72 per cent considered it to be good
or excellent.
As ambient media - especially those with audio capabilities - can be
intrusive, a positive view is crucial to the success of most out-of-home
advertising choices.
In Hong Kong, one ambient media choice has raised commuters' hackles
only because it increased the din decibel in an already noisy town. The
launch of TV screens in buses by Roadshow, a subsidiary of bus company
KMB, some months back sparked a heated debate among commuters, who
complained about noise levels.
But that hasn't stopped another operator from rolling out a competitive
offering. Celebrity-backed Star East's Mobile Media subsidiary is
claiming a 70 per cent market share for its M Channel product to
install, market and provide content and advertising for an in-vehicle TV
service, covering 2,300 buses.
On top of this, it has also secured similar contracts to install TV
monitors and plasma screens in shopping centres in high traffic areas,
medical clinics, and fast food and convenience store chains. The first
phase, involving 200 buses, will launch by the end of this month.
Expansion into mainland China will happen in the second phase, planned
for early 2002, following deals to roll out the service on buses in
Beijing, Guangzhou and Wuhan.
Wendy Yeung, chief executive of MagicMedia, M Channel's sales agent,
says the parent company will supply a regular diet of business and
entertainment news, infotainment and documentaries, which will be
screened in a 30-minute loop, with six minutes dedicated to advertising.
"If you produce quality and entertaining content, it will be easier to
attract eyeballs, which will be our strength in expanding the service,"
says Yeung.
Beyond the new flirtation with in-bus TV products, Hong Kong's bus scene
is bubbling in other ways. Advertisers credit the activity to KMB
"taking a more commercial approach" to the business and the arrival of
New World First Bus. The latter has since appointed Top Result as its
exclusive sales agent. Kam of MediaNation, says it will upgrade and
build new shelters under the deal, starting in the fourth quarter.
But it's the launch of a rail track advertising innovation that has
excited ad agencies. The UK's MotionPoster will beat New York-based
Submedia for the Asia launch of the service, which allows short, silent,
TV-style commercials to be shown in the windows of trains. Remarkably
simple in its application, the service uses some very clever technology
to adjust projection of the images according to the train's travel
speed. "Simplicity works best for outdoor. With this technology, it's
like watching a silent movie but it's the audience - not the film - that
moves," explains Sarah Burrows, account manager of Corporate
Communications, MotionPoster's PR agency in Hong Kong.
MotionPoster's Asian launch is scheduled for Seoul on October 8, with a
second site coming online four weeks later. The company is reportedly in
talks with six railway operators in Asia, including Hong Kong's two rail
companies.
Adidas, Coca-Cola and Sprite have used the service in Europe, where
client demand prompted MotionPoster to increase its offering from the
initial seven-10 seconds to 23 seconds, which can be split in several
blocks.
Burrows says existing TVCs can be adapted for the service. In the case
of its launch client Adidas, the sporting goods company had creative
made specially for a longer time slot. It ran two executions
back-to-back - the first featured an athlete followed by an old woman
running alongside and eventually overtaking the train.
These and other innovations are prompting agencies to take a greater
look at the medium, which is counting on increased TV and print
fragmentation to help its case.
Says MindShare's Clark: "Marketers are increasingly looking for
alternatives to TV, especially where irrational pricing policies by TV
media owners are creating unsustainable levels of price inflation.
Virtually every advertiser is looking for ways to cut through the media
clutter."
As irrational TV pricing policies go, this factor is likely to be the
main driver behind the 15 per cent surge in annual outdoor billings for
China between now and 2003, based on Zenith Media's projections. Last
year, outdoor's share was 16 per cent of China's total adspend. Bullish
growth expectations and an Olympic-related advertising boom should spur
significant investment in this highly-fragmented market, which recently
saw Hong Kong internet company Tom.com shell out US$38 million
for five local outdoor firms.
Though growing, and even outpacing TV and print growth rates, outdoor's
share of budget is significantly less elsewhere in Asia. While
optimistic of the industry's growth prospects, a realistic Kemeny adds:
"Payback will be years away."
- Additional reporting by Leithen Francis in Singapore and Christy Liu
in Hong Kong.
OUTDOOR ADVERTISING EXPENDITURE (hk$000S)
Year 2001 First half Total Media Outdoor
Hong Kong 14,123,977 529,565
Malaysia 1,465,300 12,501
Singapore 750,703 45,936
Thailand 29,529,917 684,972
Source: ACNielsen.
