Outdoor advertising sector booming, attracts PE funding

The two-day Outdoor Advertising Convention – 2008 (OAC) in Mumbai had three important conclusions: the outdoor media is growing at a fast pace in India; there is a need to adopt to new and emerging changes due to regulations at the Corporation and Municipal levels and thirdly, the creative spark is very much alive and kicking.

While size matters in the outdoor advertising industry, leaders in the filed were not sure of the size of this media which is slowly moving from the unorganized sector to the more organised format. While some pegged the size at a conservative Rs 1500 crore, the CEO of Laqshya, Alok Jalan, said it could be much more that – probably Rs. 2500 crore and growing exponentially at 25 percent. Little wonder that the outdoor media has started becoming the darling of private equity funding.

Sam Balsara of Madison also felt that the outdoor media is growing and probably the estimates put out by Pricewater Cooper may be very conservative. The outdoor media now has an impressive share of the pie of the overall media cake. While the print and television media still dominate, it is the outdoor that is clocking impressive growth year on year, he said.

But Noomi Mehta of Selvel Publicity, Kolkata, felt that the valuation and funding numbers just do not add up and wondered if the system needed a correction.

Despite all the pocket-warming stories of private equity funding, a word of caution was sounded by R A Rajeev, the Additional Commissioner of Greater Mumbai: Regulations in the outdoor advertising sector is a reality and will only get tougher because nobody has the right to tinker or tamper with the city’s aesthetic beauty. He said that the Mumbai laws on outdoor advertising are aimed to keep the city skyline clutter free, reduce visual pollution and banish illegal hoardings.

Rajeev also said that the focus in Mumbai will be on street furniture like bus shelters, public toilets, flower pots etc. ``All this will be of international standards and executed by companies that have global experience,’’ he said.

Rajeev’s views were echoed by major international player like Stroer. Indrajit Sen, country head of Stroer, said that the future is in street furniture, not billboards.

To an extent, a major regional player, K D Maheshwari, CEO of N S Publicity in Rajasthan, agreed on this trend. He said in Rajasthan, the emphasis is not on billboard proliferation but city beautification. ``Today, Jaipur stands out on this count and is different from other cities. We have voluntarily reduced the number of billboards,’’ he said. For his innovation and the ability to break free from the clutter, he won Gold for the best media owner of the year for the second year in succession.

But major outdoor media owners were unanimous that billboards will continue to dominate the skyscrapers in one form or the other. They pointed out that various studies have shown that people spend more time out of home than in front of their TV sets or newspaper. Hence, they view outdoor advertising more.

Piyush Pandey, the iconic advertising guru and executive chairman and national creative director of O&M agreed with this view. “Billboard advertisements would never die. In a country of a billion people and more, all media will live, if creatively used,” he said.

He also said that all creative outdoor advertisements are not measurable on the return on investment scale. ``Billboards don’t need to be all over the place – an effective billboard at the right location is all that’s required; the billboard will then speak for itself,’’ he said.

This was amply illustrated by The Economist which uses outdoor media extensively. In her presentation, Jacqui Kean, Global Brand Communications Director at The Economist said “The brand budget is deployed to deliver our global brand objectives. It is about increasing awareness, changing perceptions and building consideration to purchase over the long-term.”

The convention ended with the award nite where O&M emerged the clear winner. O&M bagged 20 metals, including two Golds and nine silvers and Merit Awards. Saatchi & Saatchi came a distant second with two Golds, one Silver and two Merit Awards.