Digital billboard advertising suffers from load-shedding

Advertisers are growing weary of billboards as a form of promotion and brand communication owing to the electricity crisis. 

The country’s strained electricity supply is forcing billboard owners to look at other options in fear of losing out on the growth that the advertising medium has enjoyed until now.

In the face of declining advertising revenue for traditional media such as print and television, billboards have shown resilience over the years.

According to Outdoor Auditors, a company providing third-party audit data to the outdoor advertising industry, digital billboards — referred to as digital out of home or DOOH — have seen 10% growth over the past few months, a positive trajectory for the medium.

But load-shedding is threatening this growth.  

Core to the issues affecting the sector is how to justify businesses paying full prices for advertising when some of the spaces they are paying for are going to be blank in the case of electronic billboards when power is out, or just not seen at night.

Understandably, digital versions of this medium are most affected, says Kena Outdoor — a billboard and brand communication company. 

“Our countrywide digital offering includes programmatic technology that allows for the automated planning, buying, selling, and measuring of adverts placed on digital screens,” says Lerumo Maisela, co-owner of Kena Outdoor.

“What makes this technology so exciting is that it allows us to provide targeted solutions to our clients.” However, due to load-shedding “many digital screens go dark as soon as the lights go off”.

This situation has caused many businesses to re-evaluate their spend on such advertising. 

According to Donald Mokgale, MD at Avatar Media Agency: “Advertisers shouldn’t be paying full prices for blank slots and the media owners know this, hence the conversation being more about the number of slots an advertiser buys versus the slots they were flighted.”

He says media owners make up for any blank slots by ensuring the campaign still receives the number of planned slots within a given advertising campaign period.

“I suppose the load-shedding issue is serving as a catalyst for a bigger conversation about DOOH reporting which to me is what the conversation should focus on. Accurate third-party reporting is required to validate booked versus planned advertising slots so that the conversation about value can be better managed and this is what will drive the industry forward.”

Erik Warburg from Outdoor Auditors says load-shedding is having a large negative effect on digital exposure. 

“A number of the 506 roadside digital screens we audited, 220 [25%] screens were not working, due to load-shedding”.

Outdoor Auditors’ data DOOH advertising spend is predicted to contribute to about 40% of the overall outdoor advertising spend in the coming years. But with the electricity challenges faced in the country “advertisers are growing wary of the medium”.

Across the advertising landscape, power outages and a general economic downturn have been having a negative effect. 

In May eMedia Holdings warned that advertising revenue across SA’s television sector has dropped almost R500m during the last financial year as businesses and consumers tighten their belts in the economic slowdown.

This is understandable against a backdrop where power directly affects the number of people that can watch TV at a given time. 

Upon reporting its 2023 full-year earnings, MultiChoice said TV audiences in SA can drop as much as 32% during power outages. 

gavazam@businesslive.co.za