In recent years, the landscape of digital out-of-home (DOOH) advertising has undergone significant transformation, driven by the integration of programmatic technologies. This white paper, a collaboration between VIOOH and Morketing Research Institute, provides a comprehensive analysis of the current state and future potential of programmatic DOOH in China. As the advertising industry pivots towards more precise and flexible solutions, understanding these developments becomes crucial for marketers, agencies, and advertisers aiming to optimize their strategies in an increasingly competitive environment.
The Current State of Programmatic DOOH
Programmatic DOOH refers to the automated buying and placement of DOOH media, leveraging digital technologies to enhance targeting and performance measurement. Compared to traditional DOOH, which involves pre-scheduled placements, programmatic DOOH offers real-time bidding and dynamic creative optimization. Despite its advanced capabilities, the adoption of programmatic DOOH in China remains in its infancy, with significant growth potential anticipated.
Market Adoption and Trends
The survey conducted in March 2023 involving 105 agencies and advertising executives reveals a growing recognition of the value of programmatic DOOH. Around 24% of respondents had planned, placed, or bought programmatic DOOH campaigns in 2022, with expectations for this figure to rise to 31% in 2023. This contrasts with a higher global adoption rate, highlighting the nascent stage of the Chinese market.
Drivers of Adoption
Several factors drive the adoption of programmatic DOOH in China:
Precision and Flexibility: Advertisers demand precision targeting, which traditional OOH and early DOOH formats struggled to deliver. Programmatic DOOH addresses this by utilizing data-driven targeting methods, allowing advertisers to reach specific audiences with tailored messages.
Technological Advancements: The integration of digital and intelligent technologies has empowered programmatic DOOH, enabling more accurate and efficient media buying processes. This includes the use of demand-side platforms (DSPs) and private marketplaces (PMPs) for real-time bidding.
Cost Efficiency: In a challenging macroeconomic environment, advertisers seek cost-effective solutions. Programmatic DOOH offers flexible placements and quantifiable impacts, allowing for better budget allocation and campaign optimization.
Omni-Channel Synergy: The strategic position of programmatic DOOH within omni-channel marketing is irreplaceable. It complements other digital channels, such as social media and digital audio, providing full-funnel activation and enhancing overall campaign effectiveness.
Barriers to Adoption
1. Lack of Understanding: There is a general lack of deeper understanding among industry professionals regarding the specific applications and benefits of programmatic DOOH, such as data metrics and audience analysis.
2. Measurement and Evaluation: The industry requires more tangible indicators to evaluate the investment value of programmatic DOOH. The absence of widely accepted metrics and robust measurement methods poses a challenge.
3. Education and Awareness: The market still lacks sufficient education and awareness about programmatic DOOH technologies, contributing to relatively low industry awareness and acceptance.
Future Prospects:
With nearly 90% of industry professionals planning to increase investments to build internal expertise and technological foundations, demand for programmatic DOOH is expected to grow rapidly as offline activities recover post-pandemic, driving advertisers back to outdoor advertising. Smart city developments and new infrastructure projects present opportunities for programmatic DOOH, including commercial districts, parks, and campuses with DOOH screens and trading capabilities. Technological advancements in AI, VR, and AR are also set to enhance programmatic DOOH capabilities, offering new engagement methods.
The VIOOH white paper highlights the significant potential driven by technological advancements and increased investment. As the industry overcomes barriers in understanding, measurement, and education, programmatic DOOH will become integral to omnichannel marketing, playing a vital role in the digital marketing ecosystem.
Contact us today to learn how programmatic DOOH can enhance your marketing strategy.
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