The DOOH Renaissance: Why Out-of-Home Ads Are Dominating in 2023
Podcasts, social media, and AI-created ad copy have all created excitement and buzz in the adtech community in 2023, but nothing has generated results like digital out-of-home. DOOH is experiencing a renaissance, emerging from the pandemic as one of the hottest areas in advertising.
The DOOH market is expected to grow at a compound annual growth rate of over 10%, to a market size of $33 billion by 2026. Interest in the channel is fueled by factors like technological innovation, granular targeting capabilities, and the vast data opportunities for brands looking to make smarter decisions about their investments.
For adtech veterans like Alejandro Donzis, CEO and co-founder of Beeyond Media, the hype around DOOH is exciting, but not surprising. DOOH advertising is expected to draw over 36% of OOH ad revenue this year, and research shows the OOH ad space is growing faster than the total U.S. ad market. Donzis says he’s witnessed steady growth in DOOH since at least 2020, when traditional media struggled during the Covid-19 pandemic.
“OOH adapted swiftly with relevant and localized content, proving its resilience and versatility,” Donzis says.
Today, an impressive 96% of marketers say they’ve achieved their ROI goals with OOH marketing. Surveys show that on average, companies that use OOH see monthly revenue increase by more than 50%.
Donzis says several technologies are making significant impacts on the DOOH ad space in 2023, including programmatic advertising, augmented reality, computer vision, and synthetic population generation, which involves creating a statistically representative digital twin of a population to facilitate more accurate audience understanding and segmentation.
“The use of big data and artificial intelligence for audience segmentation, ad targeting, and measurement is revolutionizing DOOH,” Donzis says. “AI can help analyze large volumes of data to generate actionable insights, improve targeting, and measure campaign effectiveness.”
The introduction of digital technologies has transformed traditional OOH into a much more dynamic, engaging, and effective medium. That includes the use of programmatic advertising, big data, and AI, but also advancements in data collection and analysis that allow advertisers to more accurately target specific audiences based on factors like location, time, and demographic characteristics. Donzis says each of these factors helps explain the incredible growth in DOOH.
Particularly in high-traffic areas, Donzis says OOH provides significant exposure. DOOH ads are perceived as more trustworthy compared to online ads, contributing to higher brand awareness and recall.
“Consumers face an overload of online ads, leading to banner blindness and ad-blocking,” he says. “OOH provides a non-intrusive way to reach consumers in the physical world.”
Donzis sees DOOH on an upward trajectory, and says there is ample room for continued growth. Although many brands already use DOOH, most have not fully integrated it with their overall marketing strategy. Donzis sees a holistic strategy that includes online, mobile, social, and DOOH as the answer for companies that want seamless and consistent brand experiences across all touchpoints.
“Utilizing data to drive more personalized and contextually relevant ads is still a largely untapped opportunity,” Donzis says. “As technology progresses, so too does the opportunity for brands to deliver more granularly targeted messages at scale.”