A Forrester Consulting

Thought Leadership Paper

Commissioned By Waze

April 2020

Intercept Consumers On The

Go With Digital Out-Of-Home
Advertising
Realize Business Results By Driving Consumers
Through The Last Mile
 Table Of Contents
1 Executive Summary
2 Brands Struggle To Reach Customers
At Key Moments While Respecting
Privacy
3 Contextual Advertising And In-Store
Visits Are A Priority
4 Digital Out-Of-Home Advertising
Delivers On Consumers’ Context To
Drive Results
7 Key Recommendations
8 Appendix

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 Executive Summary
For highly competitive business-to-consumer industries, in-person visitors
remain key to revenue and profitability. However, most marketers do
not optimize for the last mile that drives customers to brick-and-mortar
locations. On-the-go consumers in their cars represent a critical — and
largely untapped — context for advertising, where targeted messages
influence buyer behavior at the moment they are most ready to act.
In January 2020, Waze commissioned Forrester Consulting to evaluate
the extent to which on-the-go consumers represent a critical advertising
Digital out-of-home context. To explore this topic, Forrester conducted an online survey of
advertising is digital 424 global marketers across consumer-packaged goods (CPG), retail,
quick-service restaurants (QSRs), and gas stations and convenience
advertising that stores, along with four interviews of digital out-of-home advertising
reaches consumers users. We found that digital out-of-home helps marketers and advertisers
achieve their most critical priorities.
on the go.
KEY FINDINGS
› Global marketers adopt digital out-of-home to reach consumers
when they are most likely to make a purchase. The most common
reason brands invest in digital out-of-home advertising is to reach
consumers during critical moments of influence. Intercepting customers
while they are in their cars and more likely to make a purchase is a
critical area of focus for brands as they seek to increase visits to brick-
and-mortar locations.
› Digital out-of-home users have realized gains in both sales frequency
and basket size. Marketers whose brands use this form of advertising
estimate a weighted average 9.1% increase in the volume of sales and
an 8.3% increase in the size of sales. Even marketers whose firms
that are not yet using this form of advertising anticipate that it would
increase their store visits and sales volume/size.
› Investment and consideration of digital out-of-home advertising
are growing. Thirty percent of respondents say their firms are already
using digital out-of-home, with another 65% very or extremely likely to
consider it in the next two years. Brands will increase their investments
in digital out-of-home advertising by 4.1% on average in the next year,
making it the No. 2 largest growing category for advertising investment.
High-performing brands are investing at a rate three times greater than
low-performing brands.

TERMINOLOGY
For this study, we explore topics related to “digital out-of-home
advertising.” We defined this term to survey respondents as inclusive of
any digital advertising that reaches consumers on the go.

1 | Intercept Consumers On The Go With Digital Out-Of-Home Advertising

Brands Struggle To Reach Customers At
Key Moments While Respecting Privacy
As brands compete for decreasing consumer attention spans, they would Figure 1
ideally share their messages at key moments when buyers are primed to act “My organization struggles to reach
or make a purchase, such as when they are already in their cars. However, its target audience at influential
firms struggle to reach customers at moments of influence, especially moments.”
in ways that consider privacy regulations and customer preferences. In
surveying 424 global marketers and advertisers, we found that: 22%
› Brands struggle to identify and intercept customers at key moments. Neutral/disagree
More than three in four marketers say their firms struggle to reach
customers at influential moments (see Figure 1). Interestingly, a
difference emerges between firms that are already using digital out-
of-home advertising and those that are not: Those that are not using
it are 1.3 times more likely to agree they struggle to reach their target
audience at key moments. This gap suggests digital out-of-home offers
a way to mitigate this challenge.
› Compliance efforts change the way brands use data. Eighty-five
percent of marketers agree that new privacy regulations are changing
78%
the way they use data for advertising (see Figure 2). As the data
Agree
regulatory landscape evolves, Forrester recommends contextual
privacy, where businesses collect and use personal data in a way
Base: 424 global marketing or advertising
that is consensual, within a mutually agreed-upon context, for a decision makers responsible for media budget
mutually agreed-upon purpose. Contextual privacy can be a business Source: A commissioned study conducted
differentiator, as those that practice it demonstrate more respect for by Forrester Consulting on behalf of Waze,
customers while those that don’t risk regulatory and publicity problems February 2020
and consumer-driven backlash.1
› Increasing customer sensitivity about sharing personal data means
that marketers must respect contextual privacy. Marketers know that
customers are increasingly privacy-sensitive: 81% agree that customers
are more concerned about privacy today than they were five years ago
(see Figure 2). Customers are less concerned with sharing destination-
or location-based data than they are with sharing personally identifiable
information like personal, demographic, or psychographic data — and
these are the types of data on which ad targeting has traditionally
heavily relied (see Figure 2). Destination- or location-based data offers
a way to develop smarter campaign strategies, as long as requests
for that data are contextual and result in tangible and clear benefits
for the user. While consumers might be willing to share their location
with a navigation app that requires location data to provide accurate
directions, they would be much more wary of sharing it with a cooking
app where there is no clear benefit to do so.

2
Figure 2
“To what extent do you agree with the following?”
Strongly agree Agree
Buyer preferences for privacy are changing the way we use
23% 64%
data for advertising

New privacy regulations are changing the way we use data

25% 60%
for advertising

Our customers are more concerned about privacy than they

37% 44%
were five years ago

Customers are more concerned about sharing identifiable

33% 44%
data than location- or destination-based data

Base: 424 global marketing or advertising decision makers responsible for media budget
Source: A commissioned study conducted by Forrester Consulting on behalf of Waze, February 2020

Contextual Advertising And In-Store Figure 3

“Which of the following are likely to be
Visits Are A Priority your organization’s top advertising
priorities over the next 12 months?”
As brands seek to increase store visits and struggle to target consumers
in the right moment, context can be the differentiator. Where consumers 87%
are and where they are going are critical pieces of information for Increasing in-person
marketers to serve relevant messaging within that context. Forrester visits to brick-and-mortar
found that brands are: location
› Prioritizing in-person visits. Across industries, 87% of respondents say
that increasing in-person visits to brick-and-mortar locations is a critical 85%
or high priority in the next 12 months (see Figure 3). Similarly, 85% say Increasing in-store
the same of increasing in-store purchases. purchases

› Valuing brick-and-mortar customers. Respondents who view

Base: 424 global marketing or advertising
increasing in-person visitors as a critical or high priority characterize decision makers responsible for media budget
these customers as especially important compared to others (see Source: A commissioned study conducted
Figure 4). Seventy-four percent say in-person visitors are more loyal, by Forrester Consulting on behalf of Waze,
February 2020
making more frequent purchases that lead to a higher customer
lifetime value, while 72% say they are more valuable customers,
spending more per purchase. These findings were consistent across
industries, even among those industries that have a growing online
Figure 4
channel, such as retail and CPG.
Firms prioritize in-person visitors
› Zeroing in on advertisement context. Marketers care about the because they are:
content that their ads appear next to. In fact, 83% say they are focused
on the context of their advertisements (see Figure 5). This finding
may come as a surprise given the importance of behavioral targeting 74% More loyal customers

in the past decade, but marketers know that a critical part of getting
contextual advertising right is knowing where the customer is and their 72% More valuable customers
likelihood to respond to the message.
Base: 368 global marketing or advertising
decision makers at organizations
prioritizing in-person visits
Source: A commissioned study conducted
by Forrester Consulting on behalf of Waze,
February 2020

3 | Intercept Consumers On The Go With Digital Out-Of-Home Advertising

Figure 5
“To what extent do you agree with the following?”
Strongly agree/Agree

83% We are focused on the context of our ads

85% Our marketing and advertising efforts are focused on targeting specific audiences

Base: 424 global marketing or advertising decision makers responsible for media budget
Source: A commissioned study conducted by Forrester Consulting on behalf of Waze, February 2020

Digital Out-Of-Home Advertising Delivers “Location marketing is so

On Consumers’ Context To Drive Results important and sometimes
overlooked. We want to
DIGITAL OUT-OF-HOME ADDRESSES CRITICAL MARKETING AND intercept somebody who has
ADVERTISING PRIORITIES been thinking about furniture
and hasn’t pulled the trigger
Digital out-of-home advertising helps firms meet their objective of to visit one of our stores.”
influencing customers in context; the impact drives significant business
results. We found: Senior marketing director
at a global home furniture
› Firms look to digital out-of-home advertising to meet consumers retailer
during moments of influence. Among those marketers whose brands
are already using this form of advertising, the top reason they adopted
it was to reach consumers when they are ready to make a purchase
(see Figure 6). Additional reasons relate to mitigating privacy concerns,
supporting offline sales, and complementing omnichannel strategies.

Figure 6
Top five reasons brands invested in digital out-of-home advertising:

53% We needed to reach consumers during a critical moment of influence

44% We needed to complement our other omnichannel advertising efforts

“We’re trying to get close to
the point of decision. People
44% We needed to support offline sales
make decisions to visit a
store within 30 minutes, or in
40% We had privacy concerns about other forms of targeting some cases, within 5 minutes,
before doing so.”
Media planning and buying
39% We needed to reach consumers when they are ready to make a purchase manager at a global
quick-service restaurant
Base: 127 global marketing or advertising decision makers at organizations that have
invested in digital out-of-home advertising
Source: A commissioned study conducted by Forrester Consulting on behalf of Waze,
February 2020

4 | Intercept Consumers On The Go With Digital Out-Of-Home Advertising

DIGITAL OUT-OF-HOME DELIVERS BUSINESS RESULTS Figure 7

Digital out-of-home not only meets customers in their moments of need; it Compared to low performers,
also delivers business results. Based on our survey, we found that: high-performing firms are:

› Brands with better business results prioritize in-person visits and 1.5 times more likely to
digital out-of-home ads. We segmented respondents based on view increasing
performance across key metrics like revenue, customer acquisition, in-person visits as critical
customer lifetime value, and return on investment for advertising in the next 12 months
spend.2 The results revealed that high performers do a couple things
differently compared to low performers: 1) They are 1.5 times more Increasing investment in
likely to view increasing in-person visits as critical in the next 12 digital out-of-home
months, and 2) they are increasing investment in digital out-of-home advertising at a rate of 3x
advertising at a rate three times greater (see Figure 7).
› Marketers expect digital out-of-home to increase volume and size Base: 424 global marketing or advertising
decision makers responsible for media budget
of sales; results provide significant uplift. Global marketers expect
Source: A commissioned study conducted
that digital out-of-home advertising could deliver across in-store traffic, by Forrester Consulting on behalf of Waze,
sales volume, and size (see Figure 8). These expectations prove February 2020
true for brands that have already invested in digital out-of-home.
Respondents who have seen increased volume of sales estimate a
weighted average 9.1% increase; the same can be said for size of sales
(8.3% increase) and traffic to brick-and-mortar locations (8.0% increase).

Figure 8
Respondents who have seen/expect an increase in the following from an Weighted average change to key
investment in digital out-of-home advertising metrics among digital out-of-home
ad users*

Volume of sales 75% 9.1%

Size of sales 67% 8.3%

Traffic to brick-and-mortar
51% 8.0%
locations

Base: 424 global marketing or advertising decision makers responsible for media budget
*Base: 68 to 84 global marketing or advertising decision makers at organizations that have invested in digital out-of-home advertising
Source: A commissioned study conducted by Forrester Consulting on behalf of Waze, February 2020

5
DIGITAL OUT-OF-HOME INTEREST IS HIGH AND GROWING Figure 10

As marketers look to new advertising channels to influence buyers, many Digital out-of-home ad users who
highly consider digital out-of-home an area for growth. Looking toward initially secured investment funds
the future of advertising, we found (see Figure 9): with net-new incremental investment

› Digital out-of-home advertising currently offers some differentiation;

soon it will be table stakes. About one-third (30%) of marketers report
their brands are already using this advertising channel; almost two-thirds
(65%) are very or extremely likely to consider it in the next two years.
56%
› Digital out-of-home advertising is one of the top areas for new
advertising investment. Brands are increasing their investments in
digital out-of-home advertising by 4.1% on average in the next year,
making it the No. 2 largest growing category for advertising investment.
Most firms are funding with net-new advertising dollars (see Figure
10). Firms that already use digital out-of-home are also increasing their Base: 127 global marketing or advertising
decision makers at organizations that have
investments in traditional out-of-home (e.g., billboards) at a rate 1.9x invested in digital out-of-home advertising
times greater than other firms, suggesting that digital and traditional Source: A commissioned study conducted
out-of-home are complementary tactics to reach drivers on the go. by Forrester Consulting on behalf of Waze,
February 2020

Figure 9
Weighted average change in Likelihood to consider investing in
advertising investment over the digital out-of-home over the next
next year two years
Online video advertising 4.2% We are already invested in this
type of advertising
Digital out-of-home
4.1% Extremely likely
advertising
Very likely
Paid search advertising 3.9%
Somewhat likely “Digital out-of-home
Not likely/not applicable advertising puts brand
Social media advertising 3.4%
messaging in front of a
4% 1% captive audience. It offers a
Print publications 3.1%
reminder that exposes our
29% 30% location and our services. It
TV 3.0%
opens up an opportunity for
us to be on their path to work
Display advertising 2.4%
or home or to wherever
Traditional out-of-home they’re going and feel a time
2.3%
advertising of need.”
Printed materials 2.2% Senior media director at a
large US retailer and
Radio or podcast pharmacy
1.6%
advertising 36%

Base: 424 global marketing or advertising decision makers responsible for media budget
Source: A commissioned study conducted by Forrester Consulting on behalf of Waze,
February 2020

6 | Intercept Consumers On The Go With Digital Out-Of-Home Advertising

 Key Recommendations
Brands want to increase in-person visits to brick-and-mortar locations,
finding in-person visitors to be more loyal and more valuable than other
customers. However, they compete in crowded advertising mediums and
struggle to get their messaging to consumers when it matters most —
when they are most likely to and most able to make a purchase. As brands
look to influence buyer behavior at critical moments, digital out-of-home
advertising offers a way to target buyers within the context of their cars.
Forrester’s in-depth survey of 424 global marketers and advertisers about
digital out-of-home advertising yielded several important recommendations:
Get ahead of competition in digital out-of-home with innovation. Digital
out-of-home is still emerging as a marketing channel, which means
now is the right time to get ahead of your competitors in this channel.
Test strategies like purchasing digital out-of-home inventory based on
your brick-and-mortar locations will allow your brand to influence buyer
behavior when high-value customers are nearby and most ready to make
a purchase.3
Invest more in channels that allow for contextual targeting. As privacy
regulations and consumer preferences change, brands need to be careful
about using behavioral data for advertisement targeting and ensure that
any request for data offers value to consumers. More brands will find
contextual targeting just as effective, if not more effective, than using
behavioral data in digital advertising. Digital-out-of-home provides plenty
of levers to pull to increase the context of brand messages. With one-
third of respondents reporting their brands are already using this form of
advertising, and more to come in the next two years, digital out-of-home
is a critical way to compete for customers’ attention during key moments
of influence.
Integrate digital out-of-home into your omnichannel advertising
strategy. Digital out-of-home is complementary to existing advertising
strategies, particularly traditional out-of-home, in-store advertisements,
and other forms of digital advertising. Investing net-new ad dollars in
digital out-of-home while leveraging an omnichannel strategy will ensure
your brand stays top of mind throughout the buyer journey and that your
messaging and story across channels and devices are connected.

7 | Intercept Consumers On The Go With Digital Out-Of-Home Advertising

Appendix A: Methodology
In this study, Forrester conducted a survey of 424 global marketers and
advertisers across CPG, retail, QSR, and gas station/convenience stores
to evaluate the extent to which consumers in their cars represent a critical
advertising context. Forrester also interviewed four digital out-of-home
advertising users. Survey participants were decision makers or economic
buyers for advertising/media planning and buying at their organizations.
Questions provided to the participants asked about their marketing
priorities, challenges, and usage of digital-out-of-home advertising.
Respondents were offered a small incentive as a thank you for time spent
on the survey. The study began in January 2020 and was completed in
February 2020.

Appendix B: Demographics/Data
GEOGRAPHY INDUSTRY GROUPING
CPG
Gas stations
24%
26%
38% EMEA
37% NA

Retail
QSR 24%
25% LATAM 25%

COMPANY SIZE
5,000 to 19,999 employees 100 to 249 employees
RESPONDENT LEVEL 7% 15%
1,000 to 4,999
C-level executive 3% employees
19%
Vice president 17% 250 to 499
Director 80% employees
500 to 999 employees 26%
32%

Base: 424 global marketing or advertising decision makers responsible for media budget
Note: Percentages may not total 100 because of rounding.
Source: A commissioned study conducted by Forrester Consulting on behalf of Waze, February 2020

Appendix C: Related Forrester Research

“Digital Out-Of-Home Delivers Customers,” Forrester Research, Inc., February 22, 2019
“Modern Privacy Laws Change The Paradigm For Marketing And Advertising,” Forrester Research, Inc.,
February 19, 2020
“Predictions 2020: Media,” Forrester Research, Inc., October 29, 2019

8 | Intercept Consumers On The Go With Digital Out-Of-Home Advertising

Appendix D: Endnotes
1
Source: “The New Privacy: It’s All About Context,” Forrester Research, Inc., January 4, 2019.
2
To conduct our performance segmentation, we used data from respondents about performance across
revenue, customer acquisition, customer lifetime value, and return on investment for advertising spend.
Respondents told us how their firms had performed across each of these in the most recent fiscal year as a
percentage of change. With equally weighted subscores across the four categories, we grouped respondents
into quartiles, where the top quartile was higher performance, the bottom quartile was low performance, and
the middle two were considered medium performance.
3
Source: “Digital Out-Of-Home Delivers Customers,” Forrester Research, Inc., February 22, 2019.

9 | Intercept Consumers On The Go With Digital Out-Of-Home Advertising