Digital OOH to Soar 13% through 2013

A new report from BIA/Kelsey has confirmed what everyone in the industry already seems to know: digital out-of-home (DOOH) spending will skyrocket in coming years. The medium is expected to increase at an annual rate of 13.5% annually, from $2.2 billion in 2009 to $3.7 billion in 2013, by far outdistancing traditional out-of-home’s 1.4% growth (which will grow from $4.4 billion to $4.6 billion).

Growth of DOOH - which is made up of digital billboards and place-based digital networks - will be driven as the buying process becomes more integrated, making it easier for advertisers to purchase DOOH and reach scale.

Currently, DOOH represents a serious challenge to media buyers. There are more than 2,100 outdoor advertising companies in the U.S., but just three firms earn 85% of traditional billboard revenue. The newer digital segment has more types of companies and is much less concentrated than traditional OOH.

“DOOH must get easier to plan, buy and measure in order to reach scale,” says Rick Ducey, chief strategy officer, BIA/Kelsey. “With consolidation, partnerships and interoperable platforms, we see the buying process becoming more integrated, which will spur growth.”

Currently, billboards account for 66% of all out-of-home revenues.

The BIA/Kelsey prediction follows two big announcements that were made in the DOOH space this week: Zoom Media has expanded in the U.K. with the acquisition of Gym Screen Media, which adds 160 venues to its fitness network, and 7-Eleven has contracted with Digital Display Networks to create what the convenience store says will be one of the nation’s largest out-of-home digital networks.

The network will be deployed throughout more than 6,200 7-Eleven stores.

ZenithOptimedia’s latest projection forecasts that outdoor, along with TV and cinema, will return to positive growth in 2010