An opportunity for Pakistan’s outdoor industry

Over the course of the last 10 years, OOH in Pakistan, especially in Karachi, became an unwieldy beast that no one was able or willing to tame. Like an incessant ex, it showed up anywhere it pleased, didn’t follow the rules and demanded that you constantly acknowledge its existence.

No wonder the Supreme Court felt compelled to intervene on the people’s behalf and struck down all outdoor advertising on public land in Karachi. Many in the industry felt the ruling was harsh considering that all inventory was licensed and taxed by the local government.

Regardless, June 30, 2016 – Supreme Court’s deadline for removing all violating outdoor advertising – came and when the dust settled, almost 70% of billboards, pylons and pole signs were gone; a huge blow to an industry worth Rs 9.5 billion in Karachi alone.

The roads with the most inventory concentration were also the most affected; Shahrah-e-Faisal and Sher Shah Suri Road lost over 600 units between them. Cantonment Areas and DHA fared markedly better because they had tighter controls against installing billboards on public land.

The majority of removed structures has been temporarily decommissioned and can be reactivated within a day or two, suggesting that billboard owners are optimistic that once the current fervour of scrutiny dies down, they will be able to go back to their old ways. Their reluctance to completely dismantle the boards is understandable considering the billions they invested to legally create this infrastructure, but when the playing field changed with the SC ruling they found themselves on the wrong side of the law.

If examined closely, the SC ruling is a rare opportunity for Pakistan’s OOH industry (not just for Karachi which accounts for almost half of its revenues) to learn from its mistakes and commit to a smarter course of action that would never permit such a mortal crisis to occur again.

Like all under-legislated gold rush industries, OOH in Pakistan stepped on public toes with its incessant drive to expand; vendors were willing to install anywhere and brands were willing to buy everywhere.

This ‘anywhere and everywhere’ approach to OOH advertising is where the fault lies. It stems from a simplistic belief of agencies, brands and vendors that, excluding size and location, all billboards are created equal, which is like suggesting every car is as good as an Aston Martin.

The ‘all equal’ perception took root because there were no reliable tools that could quantify the effectiveness and quality of a particular board. This lack of measurability created the gluttonous oversupply which the Supreme Court felt compelled to cull.

However, with the launch of specialised outdoor advertising evaluation systems in Pakistan such as Move and Outnet, not having the right tools is no longer an excuse. Nor can the OOH industry hide behind inaction and wait for another traumatic event to right-size it.

Like all under-legislated gold rush industries, OOH in Pakistan stepped on public toes with its incessant drive to expand; vendors were willing to install anywhere and brands were willing to buy everywhere.

This is the perfect time for buyers to start demanding nuanced contextual planning that focuses on quality and not quantity. Vendors need to assess the reach of their inventory through audience-mapping instead of haphazardly sticking a board wherever they can.

We need to start asking questions like, “Is promoting my fizzy drink brand near Dolmen Mall sensible when it is in the lowest traffic zone in Karachi?” Or, “As a vendor can I leverage data to improve the quality of my existing sites and increase my asking price instead of adding more units?”

Consciously placing greater emphasis on efficient sites that deliver measurable results will lead to a pricing equilibrium that benefits both buyer and seller. Buyers will not have to stoop to blanket advertising; vendors will not have to waste money installing underperforming boards.

It is basic economics that more boards do not mean more money because oversupply devalues everything. Large cities around the world have far less inventory than Karachi; efficient boards elsewhere command premium prices and are booked weeks or months in advance because they can demonstrate ROI with concrete data.

Going forward, buyers will need to employ more research-based practices to identify boards worth the investment. Vendors will need to provide higher quality units that avoid clutter and score high on quality matrices.

Both of these are easily achievable through readily available research and tools. But if this opportunity for self-reflection passes by without fundamental change, it won’t be long before another supply-side shock destroys buyer confidence and nails shut the coffin of this otherwise vibrant and exciting industry.

Hameed Kashan is Team Lead, 24Grey Media & Analytics. kashan@24grey.com