From DCO to DSPs: Unpacking regional trends in programmatic digital out of home
By Adam Orridge, Senior Insights & Measurement Manager at VIOOH
VIOOH’s State of the Nation 2024 report takes an annual deep dive into the current landscape of programmatic digital out of home (prDOOH) advertising across global markets. It’s a valuable report due to the group of decision makers we surveyed in the US, UK, France, Germany, Australia and our guest market for 2024, Brazil, who are all senior leaders at media agencies or client-side, sharing their attitudes and behaviors.
This year, we’ve unveiled insights into adoption rates, market trends and the factors driving the evolution of this dynamic sector, with local market nuances key to understanding for global prDOOH campaigns.
Surging demand for prDOOH reshaping budget allocations
One of the most striking findings from our research is the significant shift in budgets towards programmatic OOH. This trend sets the stage for understanding the broader challenges and opportunities in the digital advertising ecosystem.
Programmatic OOH is not just maintaining its position, but actively drawing investment from other channels. This budget flow is an indicator of the industry’s growth potential and the increasing recognition of programmatic OOH’s value proposition.
Over a third (37%) of marketers are reallocating budgets from other digital channels to prDOOH, a growth of 4 percentage points (ppt) year-over-year (YoY). Interestingly, this growth in global prDOOH investment is being driven primarily by existing adopters, who are more likely to include prDOOH in their media plans in future (36%) compared to those who are investing in prDOOH for the first time (32%).
growth in global prDOOH investment is being driven primarily by existing adopters, who are more likely to include prDOOH in their media plans
This suggests that familiarity with the format and its benefits is a key factor in continued investment, as global marketers start to embrace programmatic as their standard buying approach for OOH, in line with programmatic’s ascendancy in other digital channels.
Across all respondents, OOH specialist media agencies led the way in responsibility for the planning and buying process at 76%, with general media agencies and DSP managed service both being used by 46% of respondents (respondents were able to select more than one option). Interestingly, we observed significant shifts in how programmatic OOH budgets are allocated and managed within agencies specifically.
Digital and programmatic teams are now leading the charge, overseeing prDOOH purchases for nearly three quarters (74%) of the marketers we surveyed. This represents a substantial 22 percentage point year-over-year increase, underscoring the growing integration of prDOOH into comprehensive multi-channel digital marketing strategies.
This trend raises important questions about the motivations behind these changes. Are we seeing a strategic upskilling of dedicated teams to capitalize on the benefits of programmatic OOH? Or is this shift driven by a desire for better cross-channel visibility through DSP-centric buying approaches?
Many of the drivers for further adoption of programmatic OOH have remained consistent year over year. Cost efficiency and data capabilities continue to top the list of factors that would encourage increased investment. The persistence of these drivers raises important questions about the industry’s progress in addressing these core needs. Is the market not responding adequately to these demands?
Contrasting DCO adoption rates
The global interest in Dynamic Creative Optimization (DCO) presented one of the most striking contrasts in our findings. Despite an overwhelming 95% of respondents expressing interest in utilizing DCO, the actual global adoption rate remains at a modest 9%.
The United States stood out with the highest adoption of Dynamic Creative Optimization (DCO), with a 16% adoption rate. This disparity highlights the advanced state of the US market in leveraging data-driven creative optimization.
Globally, this disparity between desire and actual implementation prompts us to question whether there are persistent barriers in terms of cost, technology integration, understanding, or measurement that are hampering wider adoption. This gap also represents a significant opportunity for education and development within the industry.
highlights the advanced state of the US market in leveraging data-driven creative optimization
Local market trends: sustainability, DSPs and trusted data
Marketers in the UK (61%), Australia (65%), France (65%), and Brazil (65%) particularly favor prDOOH for its efficiency and sustainability credentials, with its ability to activate only when targeted audiences are present or specific conditions are met, combined with its one-to-many broadcast nature, resonating more strongly for programmatic vs direct-sold DOOH or traditional OOH (62% prDOOH vs. 58% DOOH vs. 52% OOH).
The survey also revealed that 60% of marketers globally, and particularly in the UK and Brazil, consider sustainability an important driving factor when investing in prDOOH. This heightened focus on environmental considerations could be a harbinger of future trends in ad tech and media buying strategies.
As we examined individual markets, several distinctive patterns emerged. The growing emphasis on sustainability, now a top three factor for nearly a third of marketers globally (31%), highlights a promising trend towards eco-conscious marketing practices, an area where prDOOH demonstrates a clear advantage.
Brazil presented another interesting case study, particularly in the prevalence of Demand Side Platforms (DSP) managed services. With a 56% adoption rate compared to the global average of 46%, Brazil’s unique market structure and buying practices have clearly influenced its programmatic OOH landscape.
This finding underscores the importance of understanding local market dynamics when developing global strategies, and suggests a growing trend towards audience-based prDOOH buying across media owners.
German marketers are seeking enhanced capabilities in proximity data for precise targeting and tracking (37%), as well as improved direct response measurement tools (36%) to better evaluate prDOOH’s impact on consumer behavior and sales. Addressing these needs will be essential for fostering continued adoption and success of prDOOH campaigns in the German market.
This State of the Nation research underscores the dynamic and ever evolving nature of the prDOOH sector. While adoption rates and specific trends may vary by market, the overall trajectory is one of growth and increasing maturity.
Raising interesting questions for decision makers to consider, the State of the Nation report shares insights beyond the data, addressing ways marketers can benefit from prDOOH as it evolves and becomes widely adopted.
For more information visit: viooh.com
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