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Digital place-based ad revenue sees 25% spike, DPAA says

The DPAA announced recently that growth in the sector is accelerating, with a significant ad revenue spike in 2010's first half.

October 7, 2010 by Christopher Hall — w, t

The Digital Place-based Advertising Association (DPAA) announced earlier this week that growth rates for the industry sector are accelerating, with a double-digit revenue gain in the first half of this year.

Using information collected by Miller Kaplan Arase, the DPAA announced that advertising revenue for the digital place-based advertising sector has grown a very strong 25 percent during the first half of 2010. That double-digit growth rate builds on a growth rate of only 1 percent in 2009 — which was still a success for digital place-based, or digital out-of-home, advertising since it came at a time when most major media formats suffered steep declines in ad revenue.

The DPAA also says that its worth noting that the 25 percent ad revenue spike took place without benefitting from the short-term infusion of political advertising dollars which other media enjoy, and that it's further evidence of strong momentum in the digital place-based market. Overall, advertising revenue in the digital place-based sector is estimated to be in excess of $1 billion today, the DPAA says.

"This industry is coming together and increasingly advertisers are embracing the ability to engage consumers on the go, where they work, shop, dine, travel and play, closer to the point of purchase than the sofa in their living rooms," said Mike DiFranza, DPAA chairman and president of Captivate Network. "This sector enables advertisers to replace TV impressions lost to DVRs as well as engage light TV viewers with content relevant to their activities outside the home."

"The growth rates and activity in this sector are very encouraging," Kris Magel, executive vice president, director of national broadcast at Initiative, said in the announcement. "It’s an indication that place-based media is moving beyond the 'start-up' phase and becoming a viable medium that is here to stay — and one that is very complementary to more traditional video media options."

The forward movement in ad revenue for digital out-of-home (DOOH) or digital place-based media (DPM) advertising should continue, says DPAA president Sue Danaher, given the wealth of research done over the past two years that has validated the engagement of consumers with the medium and helped advertisers understand its impact and justify increasingly greater investments.

The Nielsen Co. currently publishes The Fourth Screen Audience Report quarterly, giving advertisers a single report that covers multiple digital place-based networks and sizes their audiences. Arbitron measures the sector annually with its Digital Place-based Video Study. And just in the last several weeks, Danaher says, both MRI and the Ipsos Mendelsohn Affluent Survey published information on the sector. Simmons will soon follow in the spring, and Scarborough is including DPM in their upcoming study, the DPAA says.

It's no secret that there are very significant crosscurrents going on in the media business these days, between the Internet, social media, mobile and DVRs allowing consumers to "zap" commericals, which makes it an exciting time for DPM, Danaher says.

"There’s a lot confronting a marketer today in getting their message to connect with consumers, and so it sets up a process where an advertiser is a lot more open-minded about what other means they might have to connect," Danaher said in a recent phone interview."Wouldn’t you as a credit card love the opportunity to advertise to a consumer who’s sitting at the table in the restaurant when the bill gets presented? That’s a beautiful thing, and that’s just one example. That is a wonderful environment to be able to connect your message to the consumer in the right frame of mind."

Advertising Revenue Growth

Sources: Miller Kaplan Arase for Digital Place-based and The Nielsen Company for all other. 2010 YTD, January through June.

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