2020 outdoor market development review and future prospects

Outdoor advertising is a medium for all consumers who go out. Therefore, the long tug-of-war of the epidemic in 2020 has had a great impact on outdoor media. In particular, due to several major issues such as sporadic recurrences and mutations of the epidemic, and the time needed to test and popularize the effectiveness of vaccines, consumers will continue to maintain a cautious attitude towards travel, and the future of outdoor media will still face challenges. This issue of Media Express will start from the perspective of the macro environment, combine industry observations and consumer trends, and conduct an in-depth analysis of the development of the outdoor advertising market in 2020 and look forward to the future.

The main observations are as follows:

Overall outdoor advertising is gradually recovering, but it still faces major challenges due to macro changes: Thanks to the increasing normalization of people's lives and activities, outdoor advertising is accelerating along with the recovery of the consumer side, especially the offline consumer side. According to GroupM’s investment data, it has recovered to nearly 80% last year. However, due to sporadic recurrences and mutations of the epidemic, consumers will still remain cautious about going out, and offline gathering scenes are also facing increasingly strict controls. Therefore, in the short term, outdoor advertising will still face challenges, but the advertising logic will still use "efficiency" and "adapting measures to local conditions" as key words for development.

Outdoor advertising has internal differentiation, and the scene effect will be further enhanced: consumers’ consumption and travel scenarios have undergone long-term changes due to the impact of the epidemic, and the role of outdoor media has also internally differentiated. Outdoor media with high daily traffic such as business districts and work scenes, and airport resources in tourism and business cities will be more popular, and more different new ways of playing will appear.

Outdoor media is accelerating its integration into the advertising matrix, and uses geographical characteristics to complement different forms of online advertising: outdoor media uses its own unique resource characteristics as an entry point to continuously digitally enhance the efficiency of publishing and information dissemination, use technology and creativity to interact with consumers more effectively and deliver content, and collaborate with social software and live broadcast functions to enhance the effectiveness of advertising.

From the perspective of overall outdoor advertising, there is a lag in the recovery of outdoor advertising: in the early and mid-term after the epidemic was brought under control, due to consumers' different mentalities about going out, advertisers cut budgets due to the unpredictable macro environment, and maintained a wait-and-see attitude towards outdoor advertising in the mid-term. As a result, outdoor advertising did not accelerate its recovery until domestic consumer activities gradually returned to normal in the post-epidemic period, and it has now recovered to 78% of the same period last year.

Internal differentiation in outdoor advertising

The scene effect will be further enhanced

Although most of the opportunities for consumers to access outdoor media declined in the first half of the year, community media, which closely adheres to the concept of "home", is a small number of outdoor media that consumers can access when travel is restricted. Therefore, the reach rate and trust of this outdoor media type have increased. In addition, in the first half of the year, consumers gradually returned to offline working from remote working, and their trust in urban public transportation and online ride-hailing/taxi services, which are essential for commuting, also increased significantly.

However, in the second half of the year, repeated sporadic epidemic outbreaks in China and virus mutations abroad have made consumers who have gradually returned to normal life show a more cautious attitude towards travel and optional consumption scenarios. Many places have recently issued notices advocating "Celebrate the New Year in place and do not return to your hometown unless necessary." Consumers are more likely to have a negative attitude towards closed spaces such as urban transportation (buses and subways), entertainment venues and cinemas: as of November, the total passenger volume in central cities across the country is still down 35.4% year-on-year, and can It can be seen that sporadic epidemics have a strong impact on passenger traffic, especially in second-tier cities. In contrast, passenger car sales turned positive year-on-year in July and have continued to show year-on-year growth of 7% to 9% for five consecutive months; enclosed theaters are also affected by Due to the impact of the country's control, the National Day box office only recovered to 76% of last year's box office, and the November box office was only 50% of last year. It should be noted that in response to strict offline epidemic prevention needs, leading companies at home and abroad have begun to test the online simultaneous release model.

Due to changes in consumer trust and demand, outdoor advertising that is closer to life scenes and outdoor scene advertising for rigid needs are therefore more resistant to pressure. The advantage of outdoor advertising in the sinking market and the urbanization development continuously promoted by policies have given it a unique charm. In addition, in the middle and late stages of the epidemic, as consumers' demand for domestic tourism increased, travel to tourist cities and residences around their residences through high-speed rail was favored by consumers during holidays. The two factors of the brand's continued sinking demand and the concentrated coverage of consumers jointly promoted the recovery of advertising along the railway. In addition, communities (homes) and buildings (workplaces) have also shown strong resistance to stress, and so far they have basically returned to the levels of the same period last year. However, as the sporadic epidemic has become increasingly serious since December 2020, and the government has once again introduced restrictive policies, outdoor advertising after the Spring Festival in 2021 may be affected again.

Outdoor media is accelerating its integration into the advertising matrix, and synergy with social networking and search may be the direction of outdoor development in 2021

Outdoor media has strong independence in 2019: in terms of media attributes, it can form complementary needs with social media and e-commerce digital media, that is, visual exclusive display advertising (wide coverage) - social media (specific group advertising) - e-commerce (purchasing channels) for advertising. Therefore, we see that customers in different industries have different preferences for their respective needs due to the different nature of the industry.

At this stage, outdoor advertising benefits from the two geographical advantages of wide crowd coverage and occupying the lives and purchasing scenarios of offline consumers. It is easier to win the favor of FMCG and brand advertisers who need to occupy consumers' minds.

*The distance between the media and the industry represents the correlation between the two.

Under the influence of the epidemic, outdoor travel has been affected by travel restrictions, and the exposure and penetration rate of the Internet have also been affected by this and have received a wave of dividends. The two types of advertisements, video and display, have the two characteristics of "display" and "visual exclusivity", and consumers are still cautious about going out. To a certain extent, they have replaced the outdoor advertising function before the epidemic.

As consumers are slowly returning to normal life despite the recurrence of the epidemic, the recovery of outdoor advertising is delayed. Judging from the development of outdoor advertising in the post-epidemic period, future outdoor advertising will make more use of offline direct interactive experience models to empathize with consumers in a more participatory way with brand concepts and content, thereby demonstrating its unique advertising value. In 2021, consumers' lives and the total number of people going out will likely return to normal due to the popularization of vaccines, and outdoor advertising may also accelerate its recovery.

At the same time, the flattening of market channels has prompted the need to use more diverse and distinctive ways to communicate directly with consumers. Therefore, we have seen that different media have also welcomed new advertisers, and the media market has also gained new opportunities.

Outdoor advertising leverages geographical characteristics, technology and creative interaction to complement different forms of online advertising

In the collection of outdoor cases in the third quarter, we also see that outdoor media continues to strengthen collaboration with other forms of media. First, it uses its own geographical advantages to enhance communication efficiency with consumers. It can not only use outdoor large-screen live broadcasts to link social and short video platforms, but also cover consumers more broadly through online and offline linkage. It can also use flash mobs and interactive forms to give consumers a stronger immersive experience opportunity; the second is to connect online and offline by scanning QR codes, and strengthen the communication between the platform’s existing audiences and potential audiences with the brand’s unique content; the third is to communicate with consumers through technology and innovative means, and to use video shooting for online secondary communication to synergistically enhance the communication effect.

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