Digital Signage Impacts Outdoor Ad Growth

Outdoor advertising spending increased 7.7 percent in the first quarter of 2006 according to the Outdoor Advertising Association of America.

Digital Billboards (aka. digital signage) was noted to be a major contributor to this significant increase. The OAAA believes this is not merely a trend. Rather it's an expansion of outdoor's market size and potential because of technologies such as digital signage.

Notable Quotes from the Article (via: MediaPost):

But the industry itself is also experiencing a long-term expansion, as reflected in the year-on-year growth. "Brands are investing more heavily than we anticipated," Freitas explained: "I think we're starting to see an acceleration in ad dollars moving from other traditional media to out-of-home." Asked why this might be so, Freitas mused: "I think there continues to be uncertainty concerning the future vitality of other media formats, and there's a lot of interest in using out-of-home to reach consumers when they're 'on the go.'"

Beth Gray, of Foote, Cone & Belding, said she's seen an uptick in outdoor ad spending too--pointing to the advent of new technologies, including digital billboards, as a way to "cut through the clutter." "I believe it--especially because in some markets people are buying and creating premium outdoor ads, not just regular 30-sheets. You can just look in Times Square--people are really starting to get into LED displays, and it's driven by the desire to create something that's truly impactful."

Freitas echoed Gray's observation, noting that while the digital billboards "segment is still relatively small, the outdoor companies are being very aggressive." According to Freitas: "A lot of outdoor companies are telling us that even before a sign is built, it's sold out more than a year in advance." By allowing advertisers to display multiple advertising faces, he went on, the digital billboards can boost revenue substantially.