Dear Dan. Is the OOH commercial model really broken?

11 Jun 2018  |  Paul Sambrook 
Dear Dan. Is the OOH commercial model really broken?

Dear Dan,

I write in response to your recent article about the Out-of-Home (OOH) commercial model being broken. It’s rare that I’m prompted to respond to such pieces but I freely admit that your article touched a nerve – probably due to the sheer number of points you raise that I take umbrage with.

Firstly, as one of your central themes is transparency, I feel it only right to point out to readers that I have a vested interest – as I work for one of those “select few OOH specialist players” that you reference (Rapport).

However, in the interest of transparency, I assume you would agree that it’s only right that we should also point out that you work for a programmatic agency? So your accompanying headline that “programmatic is the fix” – should be viewed through the lens of someone who perhaps has their sights set on that £1.1 billion market that you mention?

So, onto my issues...

Programmatic definitely isn’t the only buying and selling methodology fit for a digital age.

It saddens me to see that a lack of basic marketing understanding is becoming ever more prevalent in this “digital age”.

No argument from me that programmatic is very good at driving short-term sales - by efficiently converting people at the bottom of the purchase funnel: those people looking to buy now. But it does very little to create prospects at the top of the funnel as its ability to build brands is far more questionable.

Marc Pritchard, global marketing officer at P&G, conceded that in using digital “we targeted too much and went too narrow.”

So you’re not alone, Dan. Many marketers fail to appreciate that focusing too heavily on targeting - which is the mainstay of a data-driven programmatic approach - may boost short-term sales performance, but to the detriment of long-term measures. A classic case of confusing efficiency (short-term ROI) with effectiveness (long-term profit or market share).

Digital OOH (DOOH) does not offer the ability to deliver one-to-one messages. Yes, mobile data can enhance the performance of OOH - more of that later - but not all roads lead to Rome. And Rome isn’t always the destination for every client brief.

Transparency

We too have noticed that advertisers are understandably finding themselves questioning what they are paying for - across all media, but especially digital.

Which is why those who live in glass houses should not throw stones.

A Mediatel story revealed that The Guardian was receiving as little as 30 pence from every pound an advertiser spends programmatically with the publisher. It's the number of middlemen in the programmatic space - the DSP’s, SSP’s, DMP’s, the verification platforms etc - that is the real reason behind advertisers questioning what they are paying for, driven by the ANA Media Transparency report.

Channel integration

Regarding your observations that “[DOOH] buyers will expect a CPM approach” - and “the industry must agree how it can work to translate footfall at a digital poster into a robust impression-based metric.”

Firstly, many of our clients use independent auditors to benchmark our buying performance - and many of these already do this using CPM metrics - so this really isn’t a problem.

Secondly, you may want to familiarise yourself with Route - an independent JIC that produces audience estimates for OOH - and specifically its ability to measure DOOH. As you will see, translating footfall into impressions isn’t a problem either.

I do agree though that “programmatic capabilities in OOH has the potential of creating links to other complementary programmatically-traded channels”. But again, I’m afraid to tell you that we’re already active in this area.

Rapport UK have collaborated with programmatic agencies and client teams to integrate OOH and mobile, deploying re-targeting strategies (among others) to great effect. One DOOH and mobile video re-targeting test we ran delivered a CTR (click-through rate) uplift of 600% versus mobile-only activity.

So while we wholeheartedly agreed that OOH has the potential to reap the benefits on offer from digital – programmatic is certainly not the only fix.

Change is already happening and OOH is thriving - as are those advertisers who continue to use a trusted OOH specialist, in partnership with their own digital teams, to guide them through the changing landscape.

Yours,

Paul Sambrook,
Global Marketing Director,
Rapport

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DanLarden, Partnerships Director, Infectious Media on 11 Jun 2018
“Thanks for your comments, it’s great to see the DOOH industry getting involved in these issues. I agree with you, not all companies have approached programmatic in the right way. But the point is, the data allows as much transparency as brands can negotiate with their suppliers.

So, as more brands understand the tech they have demanded data, and cost, transparency across the supply chain. The stories we see in the news right now is programmatic being forced to clean up its act, which we fully support.

This is what I think would help brands improve the planning and booking processes in DOOH. Only by understanding the raw media cost can an advertiser truly measure and make clear decisions on the tech and service costs it needs on top of that, and make better decisions on where to allocate their entire digital budget.

It has also been great to see the number of media owners in the DOOH industry that have got in touch with me to express support for a more transparent model. Once transparency is no longer an issue, brands can get busy using data to improve efficiencies and delight consumers with better experiences.”

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03 Aug 2018 

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