Trends in Romanian OOH market: Digital screens and real-time trading

An increase in the number of digital screens and real-time trading, new developments in hyper-targeting, and a growing beacon adoption focused on analytics – out-of-home advertising (OOH) will be a core part of social and mobile strategies and will start being recognized as a direct response medium. These are the main trends across the OOH advertising industry in 2016, industry players told BR.

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In the context of constant industry change and evolution, Phoenix Media, the leader of the outdoor digital market, has continually sought to innovate in terms of out-of-home advertising (OOH) and launched the first planning programmatic application, called SETI (Integrated Traffic Extended System). This instrument is the result of a wide-ranging study conducted along with D&D Research and has as its goal to identify the demographic profile of people passing through 43 transit locations in Bucharest.

“For the first time in Romania, we have an instrument that can offer us a demographic profile, by the hour, for OOH (out-of-home advertising). We have installed cameras on all our screens and, with the help of perimeter measurement software, we quantify the registered traffic in the locations where we are present with TV screens. We didn’t have a specific target for the SETI launch. We announced it on the market when we finished its development. We started to work on this customized outdoor targeting a year and a half ago” said Dio Boaca, general director of Phoenix Media.

The company’s 30 screens have two or three cameras that record and count in real time. The SETI application counts only the people who have a high probability of seeing the screened spot on the TV screen, 90-100 percent; only those heading towards the screen are counted. At the same time, for every place in Bucharest, Phoenix Media knows exactly which type of target the firm is addressing and what the chances are of the target audience seeing the ads.

Parameters such as sex, age and income were taken into account for the research.

“This is the most complex traffic study in the history of Bucharest. We covered three different times of day and we interviewed both pedestrians and drivers, with a total of 30,000 questionnaire responses. The gathered data managed, among other things, to negate some false perceptions. For example, the biggest traffic in Bucharest is recorded at the Tineretului intersection (3.3 million general impression in December 2015); Piata Universitatii (University Square) is one of the busiest locations because people mainly use the pedestrian passage and are not counted by the cameras; the Pipera area has the following profile: 70 percent men, aged between 20 and 49, of socio-economic level ABC; and Piata Domenii (Domenii Market) and Mircea Voda are transited mainly by people with medium to high incomes,” outlined Dan Petre, managing partner at D&D Research.

The SETI application is described as user-friendly and gives clients real-time access to the status of their campaign.

How did clients and the competition react to SETI’s launch? According to Boaca, customers have given excellent feedback. Phoenix Media has had over 100 individual presentations (agencies/clients) so far and all congratulated them for the development of SETI, he said. This positive response to the existence of a programmatic planning application on the market is already reflected in the sales results. “From September to December we can revert with an answer based on numbers. Obviously, there were positive reviews from the competition too, and I think that, ultimately, this will pique the whole industry in a positive way,” said Boaca.

Phoenix Media was founded in 2003. Since 2005, the company has brought many firsts to the market, said the general director, and is currently the only one that offers personalized targeting. At the same time, the firm introduced to Romania the first outdoor promotional system on timeframes, as well as real-time transmission of messages from mobile phone to digital screens.

“In the past five years we have managed to extend the network from 13/15 to 32 billboards. Besides TV screens, we have launched LCD for OOH, a new type of support for our locations in the Old City. We have made major investments in this regard: the latest investments are a 103 sqm location in AFI Palace Cotroceni and the SETI launch, the first tool for digital OOH measuring and planning. In a market where everything is calculated by ‘I’ll see what I’ll do next month’, we have chosen a long-term strategy, which culminates now with the launch of SETI, the first programmatic planning application,” said Boaca.

Since the March launch event, the Phoenix Media representative believes that the firm has reached beyond trendsetters at country level. “Also, I think that we have given an example to other players from traditional outdoor advertising, demonstrating that if you have a long-term vision, it can turn you into a leader,” added the director.

With a market worth EUR 30-33 million this year, investments made in this field are still very small, agree specialists. Besides Phoenix Media, only two other companies on the market have sought to reinvest to change the old structures and provide a suitable OOH service for the 21st century.

“In 2015 we estimate an investment in OOH of close to EUR 25 million, representing 7 percent of the total media investment. Taking into consideration the new OOH regulations, the market might decrease. Nevertheless, due to election campaigns, we estimate a similar investment in 2016 as in 2015, followed by a small decrease in 2017. The new measurement study which should be available on the market in 2017 indicates a good step towards a healthier OOH industry in Romania, stimulating growth from 2018,” said Dan Balotescu, managing partner at Media Investment.

The same decrease was noted in the Media Fact Book 2015 released by the media agency Initiative. According to the analysis, the Digital OOH market is mainly represented by Phoenix Media, Media Advertising and Vision Media Plus, with Phoenix Media the only supplier to sell advertising space on four time slots: prime, basic, inter and nighttime.

However, according to the recently released 2016 edition, major categories such as telecommunications, FMCG, retailers and automotive continued to allocate significant sums to OOH advertising, constantly expanding and improving the visibility of their networks. In 2015, the advertising industry, through BRAT (Romanian Transmedia Audit Agency), took an important step towards the development of a frequency study on outdoor advertising, which will join its existing OOH monitoring system.

Digital and programmatic take control

Several major industry specialists agree that the main international trends are around digital OOH media. “More and more of the OOH trades will go programmatic, following the development of more advanced markets where programmatic OOH is already a norm. Moreover, it’s very likely that the virtual and hologram revolution which began this year, fueled by large international technology players like Google, Facebook and other mobile technology firms, will be the beginning of a significant new trend in OOH reality, overlapping with a virtual reality experience,” predicted Balotescu.

“Absolutely all media will be linked to digital, but it doesn’t mean that offline media will completely disappear. No way. The best example can be seen in the retail area, where all players are also present offline. We are talking about consumer electronics and home appliance retail, an area which has demonstrated that online must be linked to offline to be successful,” said the Phoenix Media representative.

Furthermore, Balotescu believes that digital OOH will be the first candidate for programmatic. “There are players, such as Phoenix Media, that are already investing in research and technology in order to get into the programmatic OOH market. It is a really good sign for an industry that is insufficiently measured at the moment. Programmatic OOH is a route for pioneers. There will be players with vision that will invest in that, but there’s still a long way to go. A first investment is not a guarantee of success. It will be an ongoing process, requiring players in this field to continue to measure, adapt and be mindful of clients and agencies in order to understand their needs and expectations,” added Balotescu.

Moreover, he says that the advantage that digital OOH has over traditional OOH is that one can better control the programmatic process, granting more flexibility in everything, from planning to the display of ads at a specific moment, in a desired context, to a desired audience.

The other big trend in the OOH industry nowadays cited by the Phoenix Media representative is that OOH programming will help DOOH to grow faster than expected. “With all the innovations we make, we will also be present in digital budgets, which is a huge advantage for us. Even if at first this initiative will mean a small contribution, it will constantly grow,” added Boaca.

Moreover, according to Balotescu, programmatic advertising doesn’t belong to only one media channel; it can be extended from online and mobile to other media, like TV, radio and OOH. And all media must be very well measured in order to be traded in a programmatic way. “For programmatic OOH to be done in Romania, the industry requires data on traffic and audience for the outdoor displays, which would be used in programmatic platforms for planning and targeting. Currently, agencies and advertisers can access monitoring data on the Romanian OOH sector. The main OOH players are planning on providing the market with an audience study under BRAT authority in the near future, in 2017,” commented Balotescu.

The news is good, according to the Media Fact Book too, as the market is becoming more and more educated and aware of the main strengths of programmatic; therefore overcoming the most important barrier and understanding the technical implications is just the first step. The word of 2016, remains as in 2015, “data”, as the main platforms show many similarities in terms of buying, so “custom targeting” is what makes the difference. For 2016, advertising budgets look solid, according to Initiative agency specialists, and the net market is expected to reach a stable EUR 28 million at the end of the year.

“Targeting and target definition are the biggest trends. The main purpose of programmatic media is targeting. If we can define the right target and use it right in campaigns, we can guarantee clients the optimum yield: inventory efficiency, communication efficiency, cost efficiency, user experience improvements etc. This is also why we are using the Quantum Data Management Platform (DMP) for all our programmatic digital campaigns,” said Balotescu.

The future is digital

When he looks at the future of the OOH industry, Boaca strongly believes that DOOH is the future and the DOOH-OOH ratio will reverse in the next ten years. As for the market regulations, those for which industry representatives have been waiting for such a long time, he thinks that Romania will have an industry covered by the rules in the next three to five years, and that indolence is what prevents this point being reached sooner.

“The advertising industry will be totally changed in the near future. Technology will make the difference in all media, including OOH. For example, Virtual Reality glasses can be an individual OOH support with direct targeting of consumers. Even though the old paper billboards are not all monitored today, in the future, OOH companies will measure very accurately all the new programmatic trade holograms overlapped with surrounding reality,” predicted Balotescu.

So where does creativity fit in amongst all these techniques? Industry operators believe that new technologies are the best incubator for creativity, making the sky the limit of where a good advertising campaign can go.

Therefore, as for every media outlet or campaign, players say the quality of the ads plays a critical role. Along with creativity itself, the measurement of the results of a campaign is very important, with immediate impact for the creative strategy. “Only by looking at actual KPIs (key performance indicators) can you judge how effective the creative process is for a particular medium and target audience. In digital programmatic OOH, you can also modify the creative aspect, in real time, in order to deliver the next right message to the consumer. Story-telling planning has a specific timing, in relation to other messages and interactions. And of course, even the creative design can to some extent be automated to generate messages based on consumers’ interactions and previous message sequences, the weather, context etc.,” concluded the Media Investment representative.

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