The outdoor industry is in the middle of a golden run in New Zealand, with 11 consecutive quarters of growth and a compound annual growth rate (CAGR) of ten percent since Jan 2013 making it second only to online as the fastest growing media channel. Digital screens are now driving most of that growth. And things are changing rapidly as all the big players invest heavily to try and get a piece of the pie, so here’s a rundown on what they’re all up to.
While OMANZ members don’t split their returns by format and Nielsen hasn’t updated its measurement to include digital outdoor yet, it's clear there's gold in them thar digital hills. A global report from PwC says digital out of home is forecast to grow 13.2 percent CAGR to 2019. This compares to an anticipated 1.5-2.5 percent CAGR in revenue for static formats. And as issues like bot fraud and viewability in digital advertising come in for more attention, outdoor seems to be becoming even more appealling (the US outdoor media industry group recently ran a clever campaign during Advertising Week called Feel the Real, which aimed to show that, unlike many digital ads, outdoor is guaranteed to be seen by real humans).
iSite, which is investing millions in its digital expansion, is set to more than double its existing collection of large format digital screens under its Aura brand with five new sites and expansion into Christchurch.
‘The City Gateway’ on Fanshawe Street will join ‘The Victoria' as the second digital spectacular in central Auckland. The large format site is 5.5m x 11m and claims to reach 150,000 people over two weeks.
Down south, 'Riccarton', a 4m x 8m site that iSite says reaches over 60,000 people in two weeks, is set to go live in Christchurch in February.
Its smaller Audience Collection of digital billboards will also continue to grow with the addition of two more sites in Auckland and one in Christchurch.
“We're delighted that the digital vision for Aura that we've previously articulated continues to coalesce rapidly,” says iSite’s chief executive Wayne Chapman. “The addition of a second landmark Auckland spectacular solidifies iSite's commitment to the nation's biggest city and most important advertising market, and we are particularly excited to bring cutting edge display technology to Christchurch, a city with which we hold deep ties. Also, the expansion of our Audience Collection network sites propels us toward our stated objective of creating an urban perimeter comprising key ingress and egress points to reach audiences as they move around New Zealand's major cities."
iSite’s Rupert Fenton says this is the company’s first year in digital outdoor, so he can’t even quote year on year growth, but he says the “investment from advertisers has exceeded our expectations in 2015”.
“This spring the market has embraced the new format of CBD digital spectaculars. Demand has outstripped supply, giving us confidence in the new digital billboard launches coming in December and 2016. We can see digital billboards are at the core of outdoor campaigns in the New Year, with customers budgeting to include digital outdoor and integrating the format into wider campaigns.”
Digital screens offer a lot more flexibility and contextual relevance than static outdoor and he points to a campaign by Noel Leeming as one of the most creative uses of the technology.
“It took photos of happy customers with their expo purchases and these pictures went live on the digital spectacular ‘The Victoria’.”
APNO was first to market in New Zealand with large format digital in 2013 and currently has nine screens in Auckland with two more consented for development in Q1 2016.
Like iSite, it is also looking to create a national network and has consents for one new screen in Wellington, one in Christchurch and one in Hamilton.
“These three new screens will be built in Q1 16 and integrated with our existing Auckland Elite Network to give the market the country’s first national (large format) screen network. All up, we’ll have 14 large format screens by April 2016, with plans to expand that to over 20 before Christmas next year ... APNO continues to outpace the market in growth and is determined to lead the way using premium quality technology, inspiring digital creativity (eg Pixel361) and is progressing well on an innovative planning tool for our clients. More on that in the new year.”
As mentioned above, there are no industry-wide figures available to show the growth of digital outdoor revenue in New Zealand, but Clemas estimates that it would be around 13 percent of the total in 2015 across OMANZ member portfolios and he foresees that share growing to over 20 percent by the end of 2016.
“This is amazing when you consider that digital outdoor revenue was less than one percent in 2013.”
APN says it is also benefitting from passenger growth at Auckland and Christchurch airports, with a 5.1% and 6% traffic increase respectively across both international and domestic terminals. And as well as ‘Apollo’ at Auckland Airport, which is the largest curved LED screen in the country, APNO has 60 high resolution screens inside both Auckland and Christchurch Airports to reach the 22m plus travellers that use them every year.
In Clemas’ opinion, nobody has quite “cracked the data nut” on how best to connect advertising on OOH digital formats to the right audiences.
“Outdoor media’s strength lies in its broadcast capabilities, its ability for one to communicate cost-effectively with many.”
And he believes the key is through the convergence of mobile (one-to-one) and OOH strategies to help motivate, provoke, inspire and excite consumers to take the journey with the brands that truly engage. And he says APN is busy working on ways to help make that happen.
Adshel moved into the digital arena in June of this year, with 35 roadside panels being switched on across the Auckland CBD and fringe suburb locations under the Adshel Live brand. And, according to general manager Nick Vile, feedback from advertisers has been positive and big demand and campaign bookings have brought forward planning for the roll out of phase two. This will see Adshel delivering a national network of some 150 panels next year.
A few of Adshel's advertising partners like McDonald’s have already capitalised on the contextual relevance these digital panels allow, and it used different messaging to promote coffee in the morning and burgers at night. There are also options to tailor creative to weather, location or current events.
Adshel has also conducted a study with Neuro-Insight to measure the effect context has on attention, engagement and overall efficacy, proving contextual ads to be 19 percent more effective.
Of course, due to rules around driver distraction, there are restrictions on the outdoor players using animation on their roadside sites. But the new generation of digital screens do have the potential to offer a whole heap more interactivity for those on foot (and Vile says they're pretty much unbreakable).
oOh!media, which operates in the retail and university environments in New Zealand, is also tapping into these new interactive technologies and, at ad:tech yesterday it launched its Excite retail screens, which offer multi-touch screens, Kinect 2.0 gesture control, voice recognition technology, high definition web-cam, Wi-Fi, audio and networking capabilities.
Akin to a giant tablet, it required an investment of more than $1 million and oOh! general manager of New Zealand, Adam McGregor, says it moves beyond simply converting traditional inventory to digital signs.
“The expectation of every New Zealander, in how they communicate, what they can do and when they can do it, is changing rapidly. We have developed our digital strategy with that in mind and Excite is a major step in this strategy. Coupled with our back-end proprietary content management system, we have created a partnership of technology and content that provides advertisers with new ways of connecting with consumers and at the same time delivering mass-audience reach.”
He says it has been attempting to drive more engagement with consumers with creative campaigns for TVNZ's My Kitchen Rules, Maggi and Lipton Ice Tea, but this technology will enable it to take the connection to new levels.
There will be five of these interactive screens in New Zealand, with plans to have a national network in the future, and they are strategically placed in mall food courts (Northwest, Downtown, Sylvia Park and Botany Town Centre) to allow for interactivity and crowd viewing, plus a long viewing time.
oOh!’s digital strategy director, Brendon Cropper, says oOh! fast tracked the roll out of the screens in New Zealand as part of its commitment to expand the national digital network, which currently consists of more than 150 digital screens. And the capabilities are being grouped into three main campaign themes: fun, fame and fortune.
Fun includes gaming, via gesture control, voice recognition and recording, fame includes the webcam for photography, and fortune is for competitions that use the touchscreen that is linked to a sophisticated back-end.
oOh!media also offers the Evoke series, a network of large format, full motion digital banners in shopping centres, and the Entice series, a network of landscape digital signs. It is also upgrading its digital ShopaLive panels with new larger 70 inch screens, which are being installed across its network.
“There have been great examples of oOh!’s digital inventory being used for speed to market by our sister company in Australia,” says McGregor. “Through our propriety platforms we were able to broadcast interest rate cuts by a major bank within hours of a decision being made. We have also been able to display advertising based on time of day or the temperature through our parting technology, connected our signs to the mobile environment through NFC and QRC, and for Holden we recently ran a time-sensitive advertising campaign for a specific sale.”
The new arrival in the New Zealand outdoor scene landed with a thud when it shacked up with Auckland Transport and it has big ambitions to bring more digital screens to New Zealand.
As of last month, QMS had 23 landmark digital billboards in Australia, with development plans to increase that to 33 by the end of the 2016 financial year. And QMS’ Chris Monaghan says it is currently in full development phase to roll out New Zealand’s largest small format (70 inch) digital network across Auckland Transport train stations and hubs, bus terminals, ferry terminals and select city car parks.
He also says it will be entering the large format billboard space soon, with sites currently under negotiation, but QMS was unable to provide a specific timeframe.
GoMedia, which has 300 billboards and 350 buses nationally, has established itself as a major OOH company, dominating the South Island. The company was established as a result of a merger between Big Picture, Go Outdoor and Bacbou and its first digital sites have now been introduced into Christchurch. The company also has consents in place for Auckland and Wellington and it has developed its own booking system called Groove with electronic contracts and, coming soon, some interactive mapping functions.
GoMedia works closely with a company called Etc in some markets and says it has three 8m x 4m screens in Christchurch. More digital screens are planned to be installed in Christchurch early next year to bring the total to six.
- Part of this story originally appeared in the November/December edition of NZ Marketing.