Does the outdoor trading model have to change?
Annie Rickard, chief executive of Posterscope, thinks outdoor trading should move beyond a cost-per-panel basis if its value is to be recognised in the wider media landscape. Is she right?
YES - Bob Wootton, Director of media & advertising, ISBA
Outdoor is a close-knit and consolidated industry sector, the main constituents of which now have sufficiently sophisticated inventory controls to trade in a different manner that is more consistent with other media channels.
In Postar, it has also invested in the audience research that could support a move from trading on a cost-per-panel basis to cost-per-thousand based on likelihood-to-see. In the modern media environment, cost-per-panel is a largely meaningless supplier-centric notion, whereas audience and relevance are the very reasons for considering out-of-home.
But OOH needs to go much further, as it continues to suffer from a mixed press, particularly related to transparency. Positive moves have been made recently. OOH media owners and specialists now need to develop these and foster far more transparent relationships with advertiser customers.
YES - Nick Parker, Commercial director UK, Kinetic
While knowledge of out-of-home, its audience and the quality of inventory have moved on dramatically, it is still traded as it always was: a commodity sold in two-week blocks, with panel price as its currency.
Our trading currency does need to change to a more audience-based solution reflecting OOH's proven, growing ability to efficiently reach very attractive audiences. Price per panel should only be one element of any OOH negotiation model.
Each site type and location has an individual positioning and value. Whatever system we develop must not lose sight of this. Fundamental to the success of a new trading model is the Postar methodology system.
But, vitally, there can't be a "one-size-fits-all" solution. Changing environments, opportunities and client needs necessitate a carefully planned solution, centered on delivering quality and value for advertisers.
YES - Andy Pearch, Director, MediaSense
The out-of-home sector is mired in an anachronistic and often counter-productive trading model. Cost-per-panel does not provide the advertiser with a context for value or effectiveness. The planning and buying process is clunky and inflexible, leading to wastage and over-spending. Industry transactions are highly opaque and there is a lack of competition.
A move to a more transparent cost-per-thousand model would benefit both players and advertisers: it would make the market more efficient, enable better comparison of value within and across formats, reward genuine quality, expose poor value and improve confidence among clients. Advertisers would start to buy more flexible and integrated outdoor campaigns. Specialists would deliver more tailored and effective schedules.
The result? An industry with less advertiser churn, lower entry costs, a longer tail of clients and reduced reliance on the few big spenders.
NO - Chris Locke, Trading director, Starcom MediaVest Group
More demographic information would be great, but in the current market no one's going to pay more for it. Even if the media owners think they can sell on a cost-per-thousand basis, you're still buying posters.
Plus, all media owners need to trade in the same way and you wouldn't want to rewrite the rule book in the current market. In fact, it could be a Pandora's Box if it proves agencies can do what clients wanted for less. Agencies might realise they don't need to buy as many sites and can fulfil their briefs in half the number of panels.
This will increase the number of formats on which agencies have information, provide data from GPS tracking and allow better reporting and flexibility, but outdoor media owners won't be allowed to charge more for it.
However, if they show value, they may be able to take more media pounds and a bigger slice of the pie.
This article was first published on mediaweek.co.uk
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