Media analysts noted that besides the country posting its worst economic growth rate since the global financial crisis a decade ago, how much the outbreak of the coronavirus (Covid-19) may dampen ad spend in the near term would depend on how fast the pandemic is contained.
Malaysia’s economy in the fourth quarter of 2019 grew by a mere 3.6%, the lowest level since the third quarter of 2009. In spite of headwinds, the OOH market is poised for growth in 2020. AIMs Research executive director Edgar Lim told StarBiz it expects adex for OOH (static and digital) to grow by 8% in 2020, following a 3% increase in 2018 and a 6% growth in 2019.
The growth factor, he said, was largely contributed from digital out-of-home advertising (DOOH), growing by 33% in 2018 and 42% in 2019.
“We foresee a continued growth in both the supply of DOOH advertising space and the demand for it, as more and more short-term tactical campaigns find themselves utilising the wide network of digital screens in Malaysia, ” he added.
DOOH to drive growth
He foresees DOOH to be the growth driver of the OOH market moving forward. Lim said: “Traditional OOH sites on the whole has plateaued in growth, registering a minor decrease in adex in 2018 and 2019.
“This means the sole growth of the industry comes from DOOH spending. As it stands in 2019, DOOH share of adex sits at 24% of the total OOH adex, 6% higher than the year before.
Based on Dentsu Aegis Network’s Global Ad Spend Forecasts 2020, global OOH spends are projected to grow by 2.4%, the fastest growth projected among traditional media channels. Interestingly, the report put OOH media’s share of spending at 9.1% in Malaysia – which is higher than the global average of 5% to 6%.
For 2020, he expect OOH adex to grow by 5% with Malaysia hosting the Apec meeting. Low, who is also the Outdoor Advertising Association of Malaysia (OAAM) president, said the growth would mainly come from the conversion of static billboard to DOOH, allowing multiple revenue yield. He also expects MRT lines to add more OOH sites.
“DOOH will continue to grow as it has been for the past three years at a double digit rate. More advertisers are shifting their outdoor marketing strategies to this format due to its vibrancy, flexibility and measurement capabilities.
“The evolution of OOH to DOOH is inevitable as digital era will continue to shape the business and communication world. DOOH allows interactive engagement, better measurement of traffic data and advance creative execution, “ Low noted.
“This is thanks to the growth of DOOH inventory in recent years. OOH as a media channel remains the last relevant traditional media format, as Malaysian consumers have not changed their travel habits much in a macro sense, ” Hor said.
Mehul said Malaysia is attracting interest from large foreign outdoor advertising providers because of the industry’s maturity. he said the country stands well above other South-East Asian countries.
“The brands and media agencies have also experienced running dynamic and audience-data driven campaigns, so media owners are aware that they can attract above-average spends for OOH, ” he said.
“With regional players like VGI and Plan B now having a big footprint in Malaysia, there is an expectation by the industry to see further consolidation at a bigger level as these groups can leverage upon larger financial muscle and expertise.
Source : https://www.thestar.com
