Electronic advertizing on the march: Technological advance and reality check

Chief editor - Vladimir Krylov
Deputy chief editor - Michael Nikulichev

The outdoor advertising business is expanding. In the USA outdoor market has been growing at a steady rate of 13% annually for the last three years; Europe exhibits somewhat lower indices– 9%. In spite of all economic difficulties, Russian outdoor advertising also experiences a boom. In 2000, it grew 15-16%; forecasts for the 2001 are even more optimistic.

However in absolute figures the situation is nowhere close. According to the OAAA annual report (Outdoor Advertising Association of America), the US outdoor market was worth $5.4 billion; in Poland it has crossed the $2 billion threshold. At the same time, according to monitoring report of the ESCAP-Analytics, Russia proudly reports $170-180 million spending on outdoor advertising (= 11-12% of the total advertising market).

Manufacturers and salesmen have long realized that money spent for outdoor advertising returns with double and triple profits. A study on advertising efficiency was conducted in the USA only to prove that 80% of businesses believe that their sales will drop significantly without outdoor advertising (OAAA: “A Report on the Uses of Billboards by U.S. Businesses”).

We may argue about aesthetic value of ever-present advertising, but the fact remains: advertising is a powerful catalyst of the economic growth, helps create new workplaces, adds significantly to municipal budgets (especially of mid-sized towns), stimulates small business ventures and plays a vital role in improving city landscapes and attracting tourism.

Outdoor advertising is an important information source for pedestrians and drivers alike. Seventy six percent of Americans consider outdoor advertising inevitable and useful; seventy percent of US drivers rely on outdoor advertising in choosing a stop-over or shopping place. Unfortunately, no such study was ever conducted in the Eastern Europe and Russia, but somewhat similar results could be predicted.

Every large city in the world is plastered with advertising billboards and electronic displays – digital advertising. The largest Russian city, Moscow, has more than 23 thousand billboards installed. The city authorities are forced to initiate careful scaling down of advertising, especially in the city center. However, advertising was instrumental in making Moscow cleaner, more attractive and lively at night time. Dark streets scare people and business away. A street flooded with advertising lights lures people from all over the city. The crime rate in well-illuminated streets is always significantly lower.

Creativity drives on progress. But in the area of outdoor advertising a search for new creative solutions is stimulated by ever-growing demands from advertisers. Every company wants advertising to be effective to sell or produce more, to be commercially successful, to bring more business, prosperity and revenue. Therefore, new electronic (digital) advertising technology tested at stadiums and concert halls is now conquering city streets. Dynamic digital advertising on large electronic screens is much more effective and interesting than static billboard image. Moreover, the same screen can display commercials of numerous advertisers over the day – thus reducing advertising space to minimum. It is important to stress that electronic advertising screens and displays, unlike other outdoor advertising, can be effectively utilized during municipal or state holidays, festivals, rallies.

Digital outdoor advertising display in Tokyo Huge outdoor advertising display in Moscow
Digital outdoor advertising display in Tokyo Huge outdoor advertising display in Moscow

The number of large electronic advertising screens and displays in large cities is growing worldwide: New York – 20, Chicago – 60, Las Vegas – 100, Seoul –90, San Paolo –50, Tokyo – 50, Moscow – 7. And there is more room for growth. Though growing is not an easy task.

For example, a large 9x12 meter outdoor display has recently appeared in Moscow. Such an event cannot go unnoticed even in a very large city like Moscow with over 10 million population. Immediately a discussion started. Who has allowed this? Were city officials bribed? But few participants of the discussion look ahead: the appearance of new advertising media – digital outdoor displays offers new opportunities, larger advertising budgets, brisk business activity and more money to the city and its people. The obvious is never easy to perceive.

The very discussion around this large digital outdoor screen means that it is effective and leaves nobody indifferent. After all every new invention faces opposition. But then progress is unstoppable. We didn’t have TVs in out homes only 50 years ago. When it came it was of poor quality and indistinct black and white picture. Who cares to remember that! All TV sets are now full-color stereo sound and the TV screen sizes are growing!

We must not forget that competition is fierce even in this fairly new technological sphere. New solutions and ideas appear almost daily. Sizes are getting bigger. The Japanese industrial giants started their attack on the world market. Here is statistics about large electronic screens and displays (over 100 square meters!) manufactured in Japan for outdoor digital advertising and already installed throughout the world: Sony – 10 (including a huge 196 sq. m display in Germany), Matsushita Electric Industrial – 4, Mitsubishi Electric – 2. US businesses are always very sensitive to new trends: so, screen sizes started to grow in the US, too.

Billboards appeared about 100 years ago. Much has changed since then. The outdoor advertising technologies have transformed drastically: from large placards glued to house walls to huge boards hanging over highways. Even more noticeable is the change in content. Outdoor advertising does well to get attention – outdoor digital screens and displays grab you, they make you look, they brand! Add to that the newest technological enhancements and you have a veritable theater of the streets.

Here is a quotation from a report on outdoor advertising conducted by the Russian marketing company “ESPAR-Analytic” and its director Mr. Andrey Berezkin: “Moscow is saturated with outdoor advertising. However people don’t suffer from it: well-cared for outdoor advertising only decorates the streets. Advertisers must realize that in conditions when the city is filled with advertising few people ever notice it consciously. However consumers pay attention, especially when images are very bright, catching attention or unusual. Otherwise advertising creates a kind of background that affects us unconsciously. A billboard or advertising screen or display must stay in the zone of natural attention of pedestrians or drivers. Also the effect of advertising message is significantly enhanced by repetition. Moscow provides an excellent example. Only three years ago, tobacco advertisers bought about 150 boards of 3x4 meter format. In 2000, this number grew to 300-400. Thus, the relative efficiency of a board dropped more than twice. Even at low rates for renting billboards, this makes the cost of an advertising campaign nearly prohibitive. Thus, efficiency of outdoor advertising billboard campaigns is falling sharply”.

Advertising changes our perception of reality. New generations are brought up not on nursery rhymes but on advertising slogans. Is it bad? New ideas go through stages of active resistance, mute acceptance and uniform approval. We cannot escape car exhaust. But who would ever demand that we outlaw cars? Computer monitor and TV screens are bad for eyesight. But we spend more and more time staring at these. After all, advertising does not affect out health. But helps to sort through information and select a brand or a product we may like.