‘You, the user, are the product’
Outdoor will not be outdoor; it will be an extension of digital advertising, says Saudi Signs Media’s Hasan Zaini
In most people’s lives, until recently, stepping out of the house was an everyday norm — a premise outdoor advertising built its business on.
An outdoor sign knows the type of people passing by and chooses the right ad for them.
Since the start of the coronavirus disease (COVID-19) pandemic, however, outdoor advertising has only shrunk. According to Zenith’s advertising expenditure forecasts, the market is predicted to reduce by 25 percent in 2020.
Growth will be stronger in the coming years — 16 percent by
2022 — but it was unlikely to return to its pre-pandemic levels. To find out more about the outdoor advertising landscape in the Kingdom, Arab News spoke to Hasan Zaini, deputy CEO of
Saudi Signs Media, a company which signed a contract worth more than SR570 million ($152 million) with Riyadh municipality earlier this year.
Q
ALet
me give you a quick background: 15 to 16 years ago, I used to be the media manager for Procter and Gamble Middle East.
At that point of time, TV was the major player dominating the media scene with at least
60 to 65 percent of the market share. Outdoor had around 11 to 15 percent market share, and internet and digital spending was below 0.5 percent — nonexistent, to be honest. Radio was a decent player and print/magazine was the second player after TV, neck to neck with outdoor advertising. In 2008, we had a global media managers’ meeting in Barcelona, Spain, and (Procter and Gamble chiefs) Bob McDonald and Mr. A.G. (Alan George) Lafley announced that they wanted to increase the digital spend to be 3 percent of the media budget. And I still remember the laughter that took place. Fast-forward to 2018 and things have changed.
Q
How did the growth of the internet and digital spending affect more traditional media, including outdoor?
Could you tell us about the overall media landscape in the Kingdom?
ATransparency
in media spending is a major factor. What digital managed to give is very accurate measurements, which many media fail to provide. And directors start questioning the return on their investments and how they can measure the spending.
At the time, the outdoor industry did not have any measurements and brand managers used to call it a black box. “I put my money in outdoor and I don’t know anything about it other than I see it on my way to the office.”
This is when multinationals decided to reduce outdoor ad spend and the shift toward digital happened, because online or digital is attractive; it is targeted and appealing to many advertisers.
Until 2018 approximately, online continued to gain market share until it reached 40 to 45 percent, basically taking from
TV, which fell from more than 60 percent of market share to 30-plus percent. The outdoor industry went from 15-16 percent to 10-11 percent and radio went down to 2-3 percent and I’m not sure if print was 1 percent or below that.
Q
AThe
economy started recovering in Q4 ( fourth quarter of the year) 2019 and January and February 2020 were fabulous months. Although usually companies hold their horses in the first quarter of the year, this was not the case in 2020.
Then the pandemic came. In March, most outdoor spending had stopped completely. We were trying to convince advertisers that there was still some traffic — policemen, firemen, and the health care sector — but there is a limit to how much we can convince.
We were cooperating with the government, as a social responsibility, to start putting out more awareness campaigns regarding the pandemic. Who was the biggest winner? TV. It was the biggest loser before, but during the pandemic people were locked down in their homes for at least three-and-a-half to four months doing nothing but internet and TV.
And then the pandemic happened. How did that shake up the media scene? Q
So, what do you see now as the future of outdoor media — beyond the pandemic and in relation to the growth of digital advertising?
AOutdoor
will not be outdoor; it will be an extension of digital advertising. People think that switching from static to LED screens is digitization — this is only the hardware; what matters is the software.
Right now, outdoor media is being measured as accurately, or as close to, as digital media as long as any human is holding his smartphone and accepting a free application.
You, the user, are the product. Your data is being sold to a thirdparty company, which analyzes it and sells it to people who care about measurements. Many people question the privacy of such an act, but it is very private; these companies do not know your name or phone number. They don’t know who you are. They know your character/ lifestyle and advertising ID.
So, if a company advertises on outdoor and they know the advertising ID of a passerby who saw the ad, they can retarget the person online. And this is where the concept of programmatic advertising in outdoor appeared wherein basically, an outdoor sign knows the type of people passing by and chooses the right ad for them.
It is still a developing concept, and I’ve seen it in Brazil and the UK. But it’s a matter of another two to three years. So, based on this, I do see the market share of outdoor advertising going up to 15 to 20 percent of the total media share in the next two to three years, and it will keep increasing.