Mark Boidman of Solomon Partners issued encouragement and a caution to the out of home industry in his speech at last week’s OOH MediaCon. Here are the excerpts.
Out of home as a durable asset
From an investment standpoint, we are very focused right now on businesses that are immune to AI disruption, or — as we discussed earlier — businesses that are actually “a friend to AI.” The durable nature of out-of-home as an asset class is significant. We know this asset class is going to exist five years from now. We know that the billboard is going to exist.
As investors and investment bankers, we’ve been involved with businesses where profits have gone to nearly zero because technology has fundamentally disrupted the model — lead generation businesses, for example, that drove traffic to websites. Those businesses are feeling real turmoil. OOH is not. And as we’ve been discussing, AI actually has the power to supercharge out-of-home: making the creative process more efficient, enabling brands to repurpose content rapidly, and driving more dollars toward the channel. Here’s a simple but powerful example: Starbucks creates a TV show. Someone wants to take a still from that show and put it on a billboard. With AI-powered creative tools, that can happen in seconds. That’s enormously exciting for this industry.
The industry’s biggest challenge: measurement
There is one thing that makes me a little nervous — and I was saying this on this same stage in San Diego back in 2015: we need to see more unification around a measurement platform. The biggest challenge we see for this industry today, when it comes to buying and selling OOH media, is measurement. There is no clear unified platform.
I’m excited to see what Geopath is doing, but from our standpoint this is critical. We’re calling on the industry to come together and put real pressure on this problem. Out-of-home – actually – can be measured today. But there is a perception among investors, buyers, and the broader media community that it can’t. So we have two challenges: educating the market that it can be measured, and building a unified system that actually resonates.
There are many companies out there doing interesting things in measurement, but there’s no unified strategy. If we’re really going to take OOH’s share of advertising spend from 3 to 4 percent up to a much higher number, measurement is the answer, and we need that unified platform. Let’s see what happens in the coming months — this is something we are very focused on.
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