Author: Mark

Craig Wallis, Business Unit Manager at The MediaShop offers a snapshot

The South African OOH (out of home) industry never ceases to amaze me with the incredible growth of media types, and its concomitant innovation. There are so many young, and passionate entrepreneurs out there that it bodes well for our country.

Possibly the most noticeable “new” media type is that of digital out of home (DOOH). If truth be told, dealing with all the various media owners that offer DOOH media can be rather daunting for a buyer like me. The reason for this is that the media owners have “skinned the cat” a hundred different ways when it comes to their media offering to prospective advertisers.

In order to get some semblance of understanding of all of these DOOH offerings, I decided to consolidate as many of the media owner’s offerings in order for me to have more of a global view of what’s digital in SA’s OOH industry.

What did I find?

Well, digital screens can be found in many different environments, so I took the liberty of classifying them all into four broad categories:

1. Place Based Screens – Transit (airports, commuter nodes, taxis, buses, cars, Gautrain and forecourts)
2. Place Based Screens – Non-Transit (salons, pharmacies, retail stores, clinics, medical rooms, pubs, restaurants and golf clubs)
3. Roadside Digital Billboards (freeway and main arterial roads)
4. Malls (screens, video walls and way finders / directory units)

N.B. I have not included sports stadia digital screens in the above.

There are around 50 media owners with Digital OOH platforms and almost 7 000 screens in their inventory. These screens vary in size from massive large format digital billboards to much smaller ones like iPads in Uber cabs. (I wonder what the total capital investment would be for all of these 7 000 screens?!?!)

I also calculated the total media value of all DOOH inventory at Rate Card rate and it came to just under R1.2 billion.

Factoring in varied discount rates, as well as likely annual occupancy levels for each of the above four categories, I calculated that the annual billings of the DOOH industry could be around R500 million. I must add that I feel that this figure is the very top end of possible DOOH spend.

What else did my “magic” Excel spread sheet reveal?

• Roadside digital screens total around 160 screens which accounted for under 3% of all screens in SA, yet Roadside generates almost 40% of all DOOH media revenue. The reason for this massive variation is due to the fact that these small number of very large screens reach a massively large audience. This means that the media rental that a roadside digital screen can generate is astronomical when compared to that of a screen in a doctor’s waiting room or in a hair salon.
• Place Based Transit screens comprised roughly 50% of the screens in SA, and they generate around 36% of total media rentals.
• Place Based Non-Transit screens total about 38% of all screens in SA, and surprisingly generate less than 10% of all media rentals. This is possibly due to the relatively small audience reached per screen (think one screen in a doctor’s waiting room versus one massive screen in a taxi rank).
• Mall screens on the other hand, comprise 10% of screens in SA, and generate around 16% of the media rentals. This is possibly due to paying a premium to reach top end shoppers at point of purchase.

A further thought came to mind whilst looking at my data and it was that it is fairly easy to compare a digital billboard with a similar static billboard. I wondered what the total media rental would be if I treated the current Roadside digital boards that I have on record as static billboards.

The current Roadside digital sites generate annual media rentals of R200 million (using my calculations, and assumptions as detailed above), however costing them as static billboards, they would only yield about R50 million in media rentals. Interestingly, it looks like converting a billboard from static to digital could increase revenues by at least 400%. Obviously, a large chunk of this revenue needs to fund the massive capital outlay for large format digital screens.

Given that advertisers pay a massive premium to be on digital screens, and the fact that they share it with other advertisers (around six other advertisers per screen) means that DOOH is way more expensive than static billboards. If an advertiser’s creative is not maximising the benefits that DOOH offers, then they could be wasting quite a lot of media spend.

Sadly, I still see many examples of creative that fail to utilise these benefits. Having said that, there are hundreds of examples of poor creative being gleefully posted on static billboards as well, but that in itself is a story for another day…

DOOH is going to keep on growing in SA as it has the world over, so brace yourself as you will find more and more environments becoming “digitised” allowing advertisers to target niche/sought after audiences.

Facebook and Google are the biggest media owners in almost every market across the globe and they seem to be heading for world domination says Richard Lord, Head of Digital / Business Unit Manager at The MediaShop. But, is that so bad?

One of my favourite TV shows growing up was Pinky and the Brain (you’re humming that tune now aren’t you?). The best part of every episode was when Pinky would ask: “Gee, Brain, what do you want to do tonight?” and Brain would reply: “The same thing we do every night, Pinky – try to take over the world!”.

Over the years there have been a few companies that have made a play for world domination, but in the last decade or so two, in particular, stand out…Google and Facebook. According to Statistica, as of Q1 2018, Facebook had almost 2.2 billion global monthly active users (that’s a third of the world’s population, give or take a few hundred million people). Google is so ubiquitous that “googling” became a verb in both the Oxford English, and the Merriam Webster dictionaries as far back as 2006.

These two global giants are so big that in 2017, according to an article in the Financial Times, they commanded 84% of global digital ad spend between them. In the US, Google and Facebook account for a quarter of ALL ad spend revenue – not just digital! As a result, more and more people have been expressing a concern about this digital duopoly.

Locally, PWC and the IAB tell us that 70% of digital ad spend goes to search (read Google), and we know from our own TMS billings how much we spend with Facebook. So the global picture is very definitely mirrored in South Africa.

So while one would think that things are looking rosy for the world’s two biggest media owners (they don’t call themselves that, but let’s call a spade a spade), the reality is that it hasn’t been all plain sailing. They have both been hit recently by scandal and controversy…

Cambridge Analytica. Two little words, but one gigantic can of worms! Add in Fake News, Rigged Elections, and they have given rise to senate committee hearings, threats to boycott Facebook, and campaigns to encourage people to delete their Facebook accounts.

What about Google? Well remember those YouTube ads that appeared next to ISIS recruitment videos in 2017? This is still an ongoing problem, and it’s not just terrorists either. Ads have been served next to content promoting white supremacy, Nazis, paedophilia and North Korean propaganda.

But here’s the rub…each time there is a scandal, there are threats by consumers to leave these platforms and delete their accounts, and advertisers vow that they will pull ad spend. But just how credible are these threats?

The reality is – not very!

In a Reuters / Ipsos poll conducted in April, half of Facebook’s American users said that they had not changed the frequency with which they use Facebook. A quarter actually said they were using Facebook more, and only the remaining quarter claimed that they were using Facebook less, had stopped using it, or had deleted their account. Facebook claim that new subscribers in the US grew by 2% in Q1 2018 which, they say, is in line with previous years.

So consumers, despite the threats, keep their accounts open and if anything, are spending more time on these platforms. But what about advertisers? The simple truth is that Facebook, Google, YouTube (and the rest) are simply just too big to ignore for any extended length of time. They may boycott for a month or two, but in the end, they keep coming back. These platforms are just too valuable to ignore!

Why are they so valuable? Because they simply are the largest media owners in every market across the globe (except maybe for China). In South Africa, Facebook is approaching 18 million monthly active users…a third of our population. We can reach 8 million South African’s a day on Facebook. YouTube has almost 12 million monthly active South African users. This makes both of them bigger than the majority of “mass” media owners in SA. And before you all start saying that they only reach the top end, consider this…the SABC puts episodes of Skeem Saam, Generations and Uzalo onto YouTube after they run on-air (a ‘poor man’s’ Catch Up service if you will). Every episode is generating in excess of 200,000 views, some as many as 350,000. That is more viewers than the average episode of Carte Blanche!

Not only that, but with every click, comment, like and share, these platforms learn more and more about their consumers – and much of this data is available to us, as advertisers, to use and to help ensure that the right ads are seen by the right people. Looking to speak to people in the market to buy a new car? No problem! Wanting to sell gym equipment to cross fitters? Absolutely! Want to get households with gamers in Fourways to sign up for super-fast fibre to the home? Couldn’t be easier.

The plain and simple truth is that Facebook and Google HAVE taken over the world! Should we be worried? Maybe! But they have so much to offer us that, in my humble opinion, the benefits far outweigh the negatives…for now!

Does your brand matter? Jedd Cokayne, Business Unit Manager at The MediaShop asks some tough questions

More and more brands are finding it difficult to trade in this ever changing and difficult market we find ourselves in. The biggest challenge is remaining relevant to a core target market.

Consumers are becoming more and more fickle with very little brand loyalty, and with easy access to a vast amount of information at a click of a button, they’re able to do their own brand and product comparisons before consuming a product.

This leaves brands in a very precarious position where they not only have to remain relevant to their consumer but most importantly have to relook their business model and what they stand for in order to ensure they set themselves apart from their competitors. Brands need to be able to trade in tough economic environments but also have a little fun along the way.

Personally, I think it’s more about making stronger connections with the exact consumers a brand is trying to reach over a period of time rather than offering a unique product or service. Does your brand resonate with its core needs and desires? Pushing brands, products and services onto consumers without a core consumer insight has become a thing of the past – brands need to really connect with their consumers.

So as brands go through the process of reinventing themselves and developing their new Vision, Mission and Value statements that will determine their next 5 to 10 years of development, one area that brands often neglect before any of this is done is the Brand Purpose. Your brand purpose is the reason your brand exists, something you can offer your consumers that no one else can, and that becomes not only what your brand stands for but also a philosophy that the staff live by. It needs to be actionable and impact the lives of the very consumer you are trying to reach.

A key area that tends to be neglected when developing the brand purpose is the buy-in from internal staff, stakeholders and service providers, ensuring they are aligned and the ethos becomes part of their daily trading habits. It may sound very cliché but employees need to live the brand to fully understand the impact they have on the consumer’s lives. It needs to become part of the company’s DNA. This is a lengthy process and should not be taken lightly because to ignore this vital step is to inhibit your brand growth twofold.

Brands need to remain authentic – ask what it is that you do or offer that is better than your competitor and remain dedicated to that. Often this entails combining forces with like-minded brands that can offer and add-on service or product combined with yours that will lead to a competitor’s edge and enhance the brand stickiness in the eyes of the consumer. Often this co-existence will further develop the brand and its reputation as it is seen as progressive and forward thinking.

But often building your brand through its brand purpose is not enough. The brand stickiness is not complete…….

What we really want is to create a brand movement, create a brand experience that consumers are drawn toward and have an emotional connection with, that’s the real relevance. Brands are moving from offering traditional products and services to delightful engaging experiences and communicating your value in the market in a powerful way. By doing this, brands will develop a passionate and loyal customer base that will not only continue to use your brand but also become brand advocates, not something a lot of brands can boast in the current trading environment.

It is often not essential to create a movement to be successful if all the other elements fall into place but it sure does help in terms of encouraging rapid growth and adopting a creative thriving business!