How Programmatic is Powering China’s DOOH Market to Become the World’s Largest

Image: Eleni Afiontzi via Unsplash
Traditionally, OOH was not seen as part of an omnichannel strategy. DOOH, and programmatic DOOH, has changed all of that says, Aileen Ku.

The rise of the digital out-of-home (DOOH) market in China is impossible to ignore. The country’s total out of home (OOH) advertising market is now worth 9 billion USD, and DOOH already comprises a third of this value. Continuing on this rapid trajectory, it’s estimated that the Chinese DOOH market will be worth 6.1 billion USD by 2027, with programmatic contributing to such growth.

The growing popularity of programmatic DOOH in the region can be attributed to several factors such as the increase of available Chinese DOOH inventory, the strength of local data partners to power programmatic campaigns and the overall growing need for local brands and advertisers to target audiences within the market.

Advancements in technology and a number of unique strengths make programmatic a must-have for brands looking to buy and activate scalable data-driven OOH campaigns in the market as part of their marketing mix

 
 

Domestic media buying: relying on vetted local partners

In order to unlock the great potential of programmatic DOOH in the region, brands and agencies must navigate the completely unique challenges China presents. The most obvious of these is that posed by the Golden Shield, the online security network known to the rest of the world as the ‘Great Firewall’, a combination of legislative actions and technologies enforced by the People’s Republic of China to regulate the internet domestically.

To address these complexities, brands and agencies are encouraged to work with domestic partners who have built compliant, certified technologies behind the shield. While outside suppliers may offer some access to the Chinese market, only partners truly based in the country can offer the level of access needed to harness the power of programmatic DOOH.

Practically, this means that local partners will be able to handle data in line with regulations, such as China’s Personal Information Protection Law (PIPL), and possess all the necessary compliance certification including the Safe Grade Protection Level certification.

 
 

Programmatic strengths: supercharged targeting, messaging, and measurement

In a market where in-person shopping and retail footfall is a key consideration for many brands and advertisers, programmatic DOOH is fast becoming a vital channel for brands to reach their desired audiences and guide them into their stores.

A strength of programmatic DOOH is the opportunity it provides for audience targeting to engage consumers with contextually relevant messages at multiple touchpoints. Historical data, such as audience movement patterns and consumer behaviors are tracked via anonymized mobile IDs, while brands can define specific audience segments based on inputs such as affinity, personas, footfall density, and dwell-time generated from their programmatic partner’s data sources.

In a market where in-person shopping and retail footfall is a key consideration for many brands and advertisers, programmatic DOOH is fast becoming a vital channel for brands to reach their desired audiences and guide them into their stores.

Brands can also activate contextually relevant messaging. Custom triggers can be activated in relation to audience density, lifestyle factors, proximity to landmarks, or even the weather. All these targeting options give brands and advertisers the agility to deliver the right message, at the right time, to the right audiences, in the right locations, while boosting campaign effectiveness.

As well as automating when and to whom ads are shown on an outdoor screen, programmatic DOOH can also determine how impactful a campaign is. Using the anonymized data thoroughly vetted by privacy-compliant local data partners, marketers can measure the impact on factors such as awareness, consideration, intent, and visitation.

Similar to the data generated by consumers when shopping online, mobile location data can be utilized to geofence DOOH screens, helping to analyze audience behavior on a large scale. This is of particular use to brands with brick-and-mortar stores who can, for example, effectively track visitations and purchases as a result of ad exposure.

Omni-channel marketing: complementing other channels

Traditionally, OOH was not seen as part of an omnichannel strategy. An effective way to raise brand awareness, yes, but the format’s historic lack of measurability has meant it was perceived as a standalone media channel.

DOOH, and specifically programmatic DOOH, has changed this. Over the APAC region, we are seeing brands harness the data-targeting and measurement capabilities of programmatic to integrate DOOH into an omnichannel strategy. This approach typically involves first exposing audiences to DOOH to build brand awareness and recognition before targeting the same audiences on other channels to trigger a secondary action or decision, such as visiting the website, signing up for a service, or finding a retailer.

Traditionally, OOH was not seen as part of an omnichannel strategy. An effective way to raise brand awareness, yes, but the format’s historic lack of measurability has meant it was perceived as a standalone media channel. DOOH, and specifically programmatic DOOH, has changed this.

In the current context, given the unique challenges of the Chinese advertising industry, seamless integration is not possible just yet in China. However, looking beyond China to the APAC region as a whole shows a vision of how omnichannel integration complements the power of programmatic DOOH.

Take, for example, the fast-rising channel of OTT video. Growing popularity with consumers has seen OTT video attract a steadily increasing share of media budgets, for which the Chinese market accounts for $16.7billion in 2022, the largest in the APAC region. In the near future, advertisers looking to reach Chinese consumers will be able to combine OTT and programmatic DOOH to effectively create campaigns that reach audiences on both large outdoor screens and small screens.

This dual-channel targeting approach allows brands to reach consumers across traditionally disjointed touchpoints and measure outcomes derived from exposure to either environment.

Bridging the gap between programmatic DOOH and other channels still requires industry-wide testing, research, and collaboration before it can be fully executed in the market.

Though in its early stages in China, the current capabilities and future possibilities of programmatic DOOH should not be ignored. Despite the market’s unique set of challenges, the key to the channel’s growth will be the expertise of locally-operated DOOH partners inside the Great Firewall who will help open this exciting market up to brands all over the globe.

Programmatic DOOH’s ability to reach consumers with privacy-safe targeting methods, as well as the growth of domestic infrastructure signal that the channel will only continue to expand in China. The possibilities are there, it is up to brands to seize the opportunity.


Image: Eleni Afiontzi via Unsplash

Aileen Ku

Aileen Ku

Aileen Ku is General Manager, China at Hivestack

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