‘Outdoor’ advertising (also referred to as OOH) is essentially any type of advertising that reaches the consumer while he or she is outside the home. This is in contrast to broadcast, print, or internet advertising, which may be delivered to viewers via tradeshow, news-stand, hotel lobby room), but are usually viewed in the home or office. Outdoor advertising products are divided among four primary categories: billboards, street furniture, transit and ambient. OOH encompasses outdoor advertising but extends to the indoors as well (such as ads in shopping centres and malls).
In 2007, outdoor advertising spend worldwide was approximately €19.9 billion, or 6.0% of worldwide advertising spend (compared to 5.9% in 2006), which was estimated at €330.1 billion.
The market has grown significantly in the last 10 years and it is generally expected that spending in OOH will continue to increase.
With TV audiences now fragmented across dozens of channels, television is not the preeminent reach vehicle it once was; there is a declining ability to deliver mass reach that is cost-effective. Therefore, marketers who need to reach large numbers of people efficiently are reconsidering outdoor opportunities. Stimulated by these developments, outdoor media companies trumpet the value of omnipresent outdoor advertising: “we are the unavoidable medium, there is no mute button, no off switch, you can’t zap it, you can’t change the channel, it is always on”.
Outdoor advertising is not only an interesting market for outdoor companies: it is also an important source of revenue for the owners of the franchises: in many cases government institutions and transport companies. At least 10% of revenues is given back to municipalities; which means that municipalities worldwide receive more than $2billion annually from outdoor advertising.
Municipal authorities do not handle signing outdoor contracts on a regular basis. Often contracts are secured for a longer period (often 10 years and more). Despite the need for transparency in tendering projects, it is often easier to renew the contract with the existing supplier. By using external knowledge about the outdoor market towns and cities could change their approach to tenders directly resulting in more income and more quality.
In short: with a focused approach about an outdoor advertising policy, municipal authorities are able to increase their revenues from outdoor advertising and at the same time they can increase the quality of the street furniture.