Apple, McDonald’s, and Disney Lead Rise in Q1 OOH Ad Spend Street Fight

Apple, McDonald’s, and Disney Lead Rise in Q1 OOH Ad Spend

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As the upfront presentations wound down, and negotiations began in earnest this month, it’s worth noting that a recent news report signaled a distinct set of diminishing media spending returns in linear TV. The article also said the beneficiaries of TV’s decline are social media spend and OOH ad spend.

The Out of Home Advertising Association of America (OAAA) has just reported that OOH ad spend rose 6.8% in Q1 to the tune of nearly $2B compared to the same period in 2023, a highest-ever first quarter volume increase. Transit was the fastest growing of the OOH categories, up 18.8%, followed by place-based ads at 12.7% growth.

Top brands with the most Q1 spending were led by Apple, followed by McDonald’s, Disney, Samsung, Morgan & Morgan Attorneys, Hotels.com, Universal Pictures, Amazon, Expedia, and Carnival.

“The growth in out-of-home can be attributed to the increasing effectiveness of [the channel] in driving consumer action and engagement,” said Anna Bager, President & CEO of OAAA. She added that the channel also has “higher recall rates compared to other media, making it an attractive option for advertisers.” Technology innovations on digital OOH, including transit advertising segments, make messages multi-locational, and they can be customized to be hyperlocal..

In other words, it’s everywhere consumers are, and the messages are contextual whether they are driving down or walking down the aisle at retail. For those reasons, Bager said OOH drives higher recall and more engagement than ever before. “OOH is ingrained in the fabric of everyday life — it’s embedded into where we work, live, and play,” she said.

A recent Harris Poll study OAAA conducted found that three-fourths of consumers view digital OOH ads more favorably than those in video, social media, print, audio, and online media channels. This favorability translates directly into action. Digital OOH is more likely to spur consumer action than any other competing ad media.

As many as 13 advertisers upped their OOH ad spend by more than 1000% in Q1 compared to the same period in 2023, the OAAA reported. Hotels.com led the in increased spending followed by QuikTrip, Grammarly, Asana, StackAdapt, Victoria’s Secret, Epoch Times, Jersey Mike’s Subs, Honda, City of Los Angeles CA, Snapchat, VRBO, and Coca-Cola Southwest Beverages.

Verticals with the highest growth in the period were online and mobile travel services (+137%); legal services (+19%); television and cable TV (+18%).

Seven of the top 10 product industries rose in volume, with six of them increasing by double digits: media and advertising (+15.4%); local services and amusements (+14.2%); public transportation; hotels and resorts (+11.9%); automotive dealers and services (+11.2%); retail (+10.5%); and government, politics, and organizations (+10.4%).

Fragmentation of audiences in other media channels is another driver of OOH’s appeal, Bager said. OOH cannot be blocked unlike online ads and subscription-based streaming services that are ad free.

The rapid rise in OOH ad spend, especially in the transit and hotels verticals suggest a return to pre-pandemic levels of mobility and travel, she observed. “This resurgence indicates that people are traveling more for both business and leisure, reflecting a normalization of activities and the confidence of advertisers in these sectors to invest in OOH advertising.”

Bager expresses near-eternal optimism about OOH for the rest of 2024, citing IPG’s MAGNA forecasts for OOH growth at 5.2% in 2024, “an exciting time to be using OOH,” she said. “This impressive growth in OOH ad spend signals a healthy economy and reflects marketers’ increasing appreciation for the effectiveness and impact of OOH. The OOH industry’s record-breaking figures serve as a strong endorsement.”

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Kathleen Sampey
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