5 Expensive Mistakes to Avoid With Out-of-Home Advertising

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Inflation is hitting marketers hard, with broadcast and digital media costs having increased by 31.2% from pre-pandemic levels. This is the biggest jump in two decades, according to Warc’s August 2022 Global Advertising Trends analysis. As a result, brands are increasingly allocating a bigger portion of their marketing budget to out-of-home (OOH) advertising.

In these challenging times, this medium remains remarkably cost-effective and delivers good ROI, according to the Outdoor Advertising Association of America (OAAA). However, while OOH advertising seems to be straightforward enough, mistakes in strategy can be expensive. Here are the top five mistakes to look out for and how to avoid them:

Related: 9 Good Reasons to Consider Out-of-Home Advertising

Mistake #1: Launching a test campaign in a top 5 DMA

Most large brands are based in big cities. So, it makes sense that they would want to start in their own backyard. However, this is an expensive mistake. Large DMAs require 20x the budget to gain the same penetration level as a smaller market. With test budgets, marketers often make the mistake of allocating initial budgets in high-expense, high-noise markets.

For example, an online OOH buying platform shows an entry-level campaign in NYC would be a $420k investment, while similar penetration levels in markets like New Orleans, Tulsa or Nashville would be $15k – $18k. Most brands with customers nationwide should widen their aperture and take advantage of lower-cost markets to properly measure the impact of their outdoor advertising.

Mistake #2: Tracking the wrong metrics for a campaign

Most consider outdoor advertising to be a brand-building channel, and of course, it is. However, it’s also so much more. When it comes to modern OOH, it would be a mistake to ignore other key metrics advertisers can benefit from. These include:

  • Increases in website traffic and online conversion events

  • Increases in CTRs on digital advertising

  • Increases in mobile app downloads

  • Increases in sales using causal lift analysis

When a consumer has been exposed to an outdoor advertisement, they can take a number of positive actions. For example, consumers who view a billboard from their vehicle are more likely to notice the ad, read it and respond favorably to it. However, these metrics are often ignored because marketers aren’t looking at the right indicators.

Related: 4 Tips for Designing Engaging Out-of-Home Advertising in 2022

Mistake #3: Losing out on lower-cost inventory

One of the best features of OOH advertising is how many formats can be used and from where. Think outside the box (or billboard), and cast a wide net for available inventory when planning a campaign — this includes working outside the big vendors. For instance, there’s a misconception that a few companies own most of the outdoor advertising space. In fact, there are thousands of media owners across the U.S. and dozens in every market. Regional and local media owners represent ~50% of inventory, so if you aren’t considering their inventory, you’re really only playing with half a card deck. This results in having half (or less) of the available selection to choose from! And since pricing between media owners varies significantly, you could be losing out on grabbing a billboard at a 60% lower cost than a similar one belonging to a different owner.

Mistake #4: Overlooking first-party data in the planning

First-party data has a ton of advantages for advertisers, including reliability, purchase history, website activity, email engagement, sales interactions, feedback, returns information and stock levels. Most companies have some (or all of) Google analytics, CRM data, MMA and performance marketing data with geographic components.

Overlaying this data reveals opportunities in markets across the country. For example, where are the CTRs the highest? Indexing CTRs by market can identify the locations with the strongest affiliation to a product. From there, marketers can compare these with local CPMs in OOH to identify brand-specific opportunities that make the most of outdoor advertising.

Related: Understanding How the Out-of-Home Ecosystem Works

Mistake #5: Choosing between traditional and programmatic OOH

The vast majority of outdoor advertising locations are traditional, meaning they require physical printing and installation of creatives. So, only including digital locations limits a brand’s reach. On the other hand, limiting a campaign to traditional methods excludes a bunch of potentially great locations as well.

Ideally, marketers should blend digital and traditional outdoor advertising, using programmatic OOH to pulse the market during the brand’s most contextually relevant days and times. This practice has yielded the strongest results because it helps to bridge the demographic digital divide and amplify the effectiveness of the campaign.

Brands are holding advertisers more accountable to their budgets and to achieving results than ever before. OOH is a powerful performance channel that can help marketers boost their other formats, while also reaching consumers in new, fresh ways. Still, mistakes like these above can stunt the results and sink an otherwise promising campaign. Keep these best practices in mind, and OOH will quickly become a go-to tool in your advertising toolkit.

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