What is Daily Effective Circulation?

As a business owner, you probably already know that out-of-home advertising (OOH) is one of the most effective ways of reaching your target audience.¹ You may also know that location is a hugely important factor in the ROI that any advertising space offers.

But when it comes to OOH advertising such as billboard advertising, how do you know whether a location is worthwhile? 

This is where Daily Effective Circulation, or DEC comes in. For many advertisers, DEC is a simple and convenient way of calculating impressions, or the number of consumers who are likely to pass your billboard each day. 

Interested in learning more about DEC outdoor advertising and how to use it to plan your ad campaign? Keep reading.

What is DEC in Out of Home Advertising?

In OOH advertising, daily effective circulation refers to the average number of people in a car or other method of transportation who could potentially see a particular billboard, poster, or other form of outdoor ad within a given timeframe measured in hours.² That timeframe is known as the effective illumination rate. 

Its length is determined by whether the outdoor ad is illuminated or unilluminated: 

• Illuminated – The DEC of billboards that are visible after dark is calculated using a timeframe of 18 hours—for instance, 6:00 am to 12:00 midnight. In some cases, the DEC of illuminated billboards may be calculated according to 24-hour periods. 
• Unilluminated – For billboards that can’t be seen once the sun sets, the DEC is calculated using a timeframe of 12 hours—for instance, 6:00 am until 6:00 pm. 

But the effective illumination rate is only one part of the DEC equation. Calculating the DEC of an OOH ad also requires two other crucial pieces of data: 

• Average number of passing vehicles – Your state’s Department of Transportation can provide you with statistics that can tell you how many vehicles are likely to pass your particular billboard or other OOH advertisement. ³
• Average number of adults in each vehicle – In addition to how many vehicles might pass your billboard, you need to know how many adult passengers are in each of those vehicles. Again, this information can be obtained through your state’s Department of Transportation office. 

How to Calculate DEC

When it comes to DEC, outdoor advertising experts use a simple calculation to determine how many impressions a given billboard could possibly receive each day. The equation for calculating DEC looks like this:

(Average number of vehicles) x (Illumination rate) x (Average number of adult passengers)

Let’s plug in some hypothetical numbers. Suppose you have an illuminated billboard that’s so well-lit it would be impossible for anyone driving by to miss it. Now, suppose you want to calculate the DEC of the billboard for a period of 18 hours, from 6:00 am until 12 pm, when you expect the billboard to have the best shot. That gives you your first variable: the effective illumination rate. In this case, it’s 18. 

Now, let’s say that the data you received from your state’s transportation department tells you that roughly 1,000 cars are likely to pass your billboard during your timeframe. That number needs to be divided by two so that it only accounts for cars that are heading in the right direction to see your billboard. We’ll also say that the data suggests that each vehicle is carrying roughly 1.38 adults. 

Now we have all the necessary components for calculating the DEC. To review, our hypothetical numbers are:

• 500 (number of vehicles)
• 18 (effective illumination rate)
• 1.38 (number of adults per vehicle)

Using those variables, our equation is:

500 x 18 x 1.38 = 12,420

Thus, the daily effective circulation of the billboard space in question is just over 12,000. That means that over 12,000 consumers with nothing else to look at could possibly see your advertising display every day. Sounds pretty good right?

Not so fast. Although daily effective circulation is the historical method of calculating impressions, it can only tell you how many people might see your ad—and even that’s only an estimate. However, keep in mind that there are other metrics that help you gather more information. You can use Geopath OOH ratings to better assess what type of people will see your ad or determine your CPP calculation media costs to better plan out your advertising budget. 

True Impact Media

When you launch your outdoor advertising campaign with True Impact Media, you don’t have to rely on old formulas for measuring success. Instead, our innovative media buying platform provides you with detailed insight into your ad campaign so that you always know how it’s performing.

At True Impact Media, we believe that outdoor advertising doesn’t have to be difficult. So we’re making it easy and connecting business owners with premium billboard advertising space in millions of locations all over the U.S. Start building your OOH campaign today.

Sources: 

1. Out of Home Advertising Association of America. OOH Value Guide. https://oaaa.org/Portals/0/Public%20PDFs/OOH%20Value%20Guide.pdf 
2. Out of Home Advertising Association of America. Glossary of Terms. https://oaaa.org/AboutOOH/OOHBasics/OOHGlossaryofTerms.aspx 
3. True Impact Media. Calculating Impressions. https://trueimpactmedia.com/blog/calculating-impressions/