Outdoor advertising sector gaining steam across Mena

Aug. 24--Market in UAE poised to see significant growth in 2014, 2015

Outdoor advertising is gaining popularity across the Middle East and North Africa as international and local brands prefer to use this platform to promote consumer-driven products, according to an industry official.

Rehan Merchant, chief executive of Emirates Neon Group, or ENG, said the outdoor advertisement business noticed significant growth in the UAE after the announcement of Dubai's successful bid to host World Expo 2020.

"In the past few years, outdoor advertising -- predominantly the consumer-driven sectors such as retail, fast-moving consumer good and automobiles -- have seen a significant rise in spend and soon will be followed by the real estate sector," Merchant told Khaleej Times in an interview.

ENG is considered to be one of the top five main outdoor advertising companies in the UAE, with a market share of 11 per cent of the "out of home", or OOH, advertising market. It has delivered a huge range of tailored signage projects, from small internal signages to large shop fronts and custom digital signages and media for outdoor advertising across the Middle East.

"We are actually the first company to bring the concept of outdoor advertising to the region; we have started this business in 1989, and since then we have continuously evolved. For the upcoming years, we will be focusing on digital technology for OOH advertising," Merchant said.

"We currently hold 11 per cent of outdoor advertisement and are aiming to achieve 18 per cent of total market share," he added.

To a question about the size of the outdoor ad market, he said concrete figures for 2014 are still to be determined, but it is on the rise due to a stable economy, strong recovery in the real estate sector and a boom in the tourism and hospitality industries.

Referring to valid sources on the latest predictions for regional patterns, he said general advertising spend could be in for a significant increase of 7.3 per cent this year on top of the 4.3 per cent gain in 2013.

"Advertising spend varies between local and International brands. International brands spend 14 per cent of their marketing budget on outdoor as per Pan Arab Studies & Research Company [Parc] 2013 figures, but as per our advertising monitoring department, it is 22 per cent, whereas local brands allocate 30 to 45 per cent of their budget to outdoor and in some cases could even go up to 65 per cent. This variation is due to the use of other marketing means by international organisations such as TV, radio, newspaper, etc, but local brands tend to focus more on outdoor," he said.

New trends

About the new trends in outdoor advertising, he said the power of outdoor advertising has been observed, even well before the emergence of new digitally-based advertising platforms.

"As part of a multimedia plan, outdoor ads can -- and typically do -- achieve broader engagement than any other medium. I believe a well-designed outdoor ad reflects the brand identity to nearly everyone who sees it. We are focusing on large format sites as well as digital mediums which are gaining extreme popularity.

"We have also been focusing on various campaigns using premium transit media such as taxis and mobile ad trucks. We have the option of 3D ads as well, which are mainly noticeable on Sheikh Zayed Road, which has been attracting attention the past few months."

Regarding the key parameters for outdoor advertising and average budget for low- and high-end customers, he said the location of the site, traffic counts and visibility of advertisements, among others, are considered most important elements in outdoor advertisement business.

"Budgets vary from local to international clients and there are no standards or specific in spending levels, they vary per campaign."

Steady business growth

About the company's performance in 2013 and the impact of the successful Expo 2020 bid on the outdoor ad business, Merchant said ENG has had a steady growth percentage of 10 per cent since 2012, which is a significant increase from the previous year.

"The announcement of the Expo 2020 bid has no doubt had a huge impact on the UAE market and will continue to do so in the coming years. We are very optimistic about the positive impetus for the UAE economy that Dubai Expo 2020 will bring."

"Specifically with regard to the advertising market that has benefitted the most, by the concerted campaigns put out by Dubai and its supporting partners, post the Expo 2020 announcement. Also, with an increase in the consumer-driven sectors such as retail, hospitality, travel and tourism, outdoor advertising has seen a significant rise in spend," he said.

Regarding the outlook for the outdoor advertisement in 2015, he said: "As the full-year ad spend tally has not been counted for 2014, based on the results of the 2013 report by Parc, one could estimate that the advertising market in the UAE region will see a significant growth in 2014 and 2015 with outdoor media most likely to see a spike in demand and rates as a result."

"The private sector has not radically increased its ad spending; one key factor being the performance of traditional media that are able to reach out to a wide audience and give a good return on investment. Therefore, one can be cautiously optimistic and can bank on seeing selective increase in the local ad and media market," Merchant concluded.

Khaleej Times, Dubai, United Arab Emirates