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Digital Signage: Three Handy Rules to Succeed |
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By finding the right digital
signage partner, investing in content development and providing your people
with the best training available, you can rest assured that your digital
signage network will continue achieving the goals you set out for it far into
the future.
It seems
every day brings a new announcement in the digital signage arena -the release
of a whiz-bang technology, a new vendor entering the market, some huge sale or formation
of a new strategic business alliance.
While
news of this sort is interesting and relevant, it can be a bit overwhelming. In
fact, it can lead to a bit of paralysis in implementing a digital signage plan.
Fear of premature obsolescence, or missing out on the next important development
to come along, can retard progress and direct energy and attention away from
the true mission, specifically, communicating effectively with clients,
constituents or employees to advance the marketing or informational goal of the
enterprise.
But
rather than sitting on the sidelines waiting for some never-to-be-attained zenith
of technological development to be realized before making the decision to
proceed, wouldn't it be better to find a framework within which a digital
signage deployment can be made that lets you respond and if necessary
assimilate the changes that inevitably will come along?
Here are
three handy rules to help you succeed with your digital signage deployment
regardless of the changes that come along:
One:
Don't just choose a digital signage vendor, select a digital signage partner. This
is the crux of the matter. Technology continues to change at an ever-increasing
rate. What must remain constant is an unwavering commitment on the part of your
digital signage vendor to adapt existing solutions to meet your needs as they
change. If that means writing new software, so be it. If it requires developing
new drivers, new interfaces or taking any other steps needed to integrate
"must-have" third-party components into the digital signage network, a true
digital signage partner must be willing and capable of doing just that.
Two:
Invest in your content. It's funny how many of the latest "earth-shattering"
digital signage developments turn out to be small blips on the continuum of
progress. What helps to inject a bit of reality into the latest whiz-bang
announcement is the sense of security that your digital signage messaging is on
target and accomplishing your desired goals. What does it matter if there's a
new digital signage technology that will polish the shoes of people who
approach a sign if no one ever stands there long enough to get it done because
the content is so irrelevant?
Three: Invest
in training your people. Whether they are in-house content creators, sales
people securing advertising contracts or IT or AV managers tasked with
monitoring the performance of the digital signage network, your people are your
real assets. The better trained they are, the more productive your digital
signage network will be.
There's
nothing wrong with wanting the latest or greatest technology to be a part of
your digital signage network. But you have to ask yourself just how important
that is to accomplishing your real goal. If there's no other way to achieve
your goal without adding that technology, by all means do so. However, nine
times out of 10, if you take a moment to consider all of your options, you'll
find that you can rely on creativity -whether it's in the realm of content
creation, IT management or sales- to achieve the goal you desire.
By developing a partnership with a digital
signage vendor, investing in training your personnel and devoting the resources
necessary for content development, you'll position your digital signage
deployment to best achieve the goals you've set for your network. You'll also
have removed that element of paralysis that can set in when the fear that the
digital signage network you're contemplating will become obsolete.
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Digital Signage ROI: Sometimes the Numbers are Easy to Get, But Not Often |
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Determining
the return on investment of a digital signage network isn't always easy.
Ask a savvy investor what's the five-year average return
on the mutual fund he's using for his 401k investment, and he'll rattle off the
answer quicker than the Fed can print money.
Ask a farmer how much a given fertilizer costs and how
much bigger his crop yield is because of it, and he'll respond with more
certitude than the rooster that crows at dawn.
Ask a digital signage network operator what's the return
on investment (ROI) of his digital signage system, and the answer may be tinged
with a degree of uncertainty and hesitation.
Why? Because in many ways the factors that go into determining
the ROI of digital signage can be a bit, for the lack of a better term,
"squishy." Figuring out the ROI of digital signage can be like walking through
a heavily rain soaked field. You know eventually you'll reach something firm on
which to build your next step, but getting to that solid foundation can be a
little tenuous.
Wouldn't it be great if it were as simple as looking at
the cash spent to set up and maintain the network, measuring the cash generated
or saved by the digital signage network, dividing the latter by the former and
coming up with a return? While that might be practical in some digital signage
applications, the "squishiness" of many others makes arriving at the return on
investment of a digital signage network much more difficult.
To illustrate the difference, consider these two
scenarios: a casino that's replacing all printed promotional signage with
digital signage and a corporation setting up a digital signage network to
communicate with employees.
In the casino scenario, the gaming facility typically spends
$300,000 annually to print promotional signs and an additional $50,000 annually
for the salaries of employees to replace old signs with new signs to update
patrons on the constantly changing entertainment acts, restaurant specials and
casino promotions.
By replacing the traditional signs with a digital signage
network, the casino will have a one-time expense for the cost of the LCD or
plasma panels, the digital signage media players, network cabling, routers, and
ancillary hardware. Say $300,000, and throw in $50,000 annually to maintain the
network.
For the sake of this scenario, the cost of creating
content will be virtually the same. Graphic artists using Adobe Photoshop and
InDesign to create print ads will now use Adobe Photoshop, Premiere and Flash
to create content for the digital signage network.
Figuring out the five year return on this digital signage
network is a snap: $1.75 million in printing and labor savings ($350,000 x 5)
divided by $550,000 ($300,000 for the initial installation and $50,000 x 5
years for maintenance) = 318 percent return for five years, or about 64 percent
annual return.
While there could be other factors impacting the total ROI
of this system -like advertising revenue from allied businesses wishing to
advertise on the network -this scenario illustrates that there can be a
straightforward ROI assigned to some digital signage applications.
Squishy comes into play in scenario No. 2, the corporate
digital signage network. A corporation installs a modest digital signage
network that includes a sign to greet visitors in the lobby, several digital
door cards to identify what's booked for various conference rooms and a digital
sign in the corporate lunchroom.
The squishy factor in this scenario relates to identifying
and measuring employee and visitor behavior as it relates to the digital
signage network. Did a visitor to the company feel more welcomed when she saw a
personal greeting on the sign in the lobby? Did that feeling translate in even
the smallest of ways to a more productive meeting with the person she was there
to meet? Did that translate into some monetary value?
Do the signs used as digital door cards inform the people
of the right conference to attend? Do they reduce interruptions, help meetings
to start and end on time, and in so doing improve productivity? Can that be
measured? What's the monetary value?
Does the sign in the lunchroom create a degree of loyalty
to the company by recognizing achievement? Does it improve the experience of
employees by keeping them better informed of what's going on in and around the
premises? Is there a monetary value that can be measured?
These
sorts of benefits are much more difficult to reduce to a simple ROI equation
because they're squishy. But just because they are squishy doesn't mean they
are not important or real. Being squishy just means it's harder to identify the
true ROI of the digital signage network, not that there is no ROI.
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Digital Signage: Traditional Media Show More Signs of Weakness, But OOH Ad Networks May Offer Hope |
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Traditional media companies
continue to grapple with tectonic changes in ad buys; maybe it’s time to
leverage their strengths in the out-of-home video ad network arena.
More signs
of the uncertain times ahead for traditional media in this country have emerged
over the past few weeks.
Belo,
which owns newspapers like the Dallas
Morning News, the Providence Journal,
and the Press Enterprise, as well as
owns and operates 20 TV stations, said Oct. 1 it was splitting its holdings
into two companies: The New A. H. Belo Corp., dedicated to the print properties,
and Belo Corp., which will run the TV business.
Then E.W.
Scripps said it would take a similar path Oct. 16 when it announced that it
would break into two companies: E.W. Scripps Co., which will consist of about
20 newspapers and local television stations, and Scripps Networks Interactive,
consisting of Home & Garden Television, the Food Network and Shopzilla.
At about
the same time as the Scripps announcement, McClatchy Co., the third largest
newspaper company in the United
States, said its quarterly profits dropped
55 percent for the third quarter, a result of a weakening advertising market.
It's clear
traditional media companies are suffering a significant decline in readership
and advertising lineage. Many of the dollars once spent on newspaper ads are
being redirected into emerging new media like the Internet as media consumers
increasingly log on to online sources to catch up on their world. Hence,
companies like Belo and Scripps are separating business units into stand alone
companies to cordon off the drag on their revenue and sustain shareholder value
and interest.
These are
among the largest media companies in the nation. If they aren't impervious to the
change brought on by new digital media, it's unlikely other traditional media
companies will be able to continue down the same path they're on without making
some course corrections along the way.
To be
sure, Internet advertising is taking a sizeable bite out of the dollars once
devoted to traditional newspaper, television, radio and magazine advertising.
Another emerging digital media competing for its piece of the ad budget is
out-of-home advertising, and more specifically out of home video advertising on
digital signage networks.
In late
January, the Out-of-Home Video Advertising Bureau (OVAB) formally launched with
the mission of helping to provide standards and best practices for the newly
emerging slice of the advertising industry. It was created by many of the
largest out-of-home video advertising networks to remove impediments to the
growth of the new ad medium.
One of the
chief missions of the group is to help advertisers and those who run
out-of-home video advertising networks work together "to plan, buy and evaluate
the effectiveness of these mediums," said Mike DiFranza, president and general
manager of Captivate Network, one of the 10 companies that founded the group.
The contrast
couldn't be more apparent: On the one hand, many traditional media are
scrambling to restructure so they can decouple business units with the
potential to be profitable from those suffering from the re-allocation of
advertising dollars to new digital media. On the other, a group like OVAB has
emerged to help the fledgling medium of out-of-home video advertising build the
advertising "street cred" that traditional media long ago mastered.
While it's a long shot, perhaps there's an
opportunity for traditional media and emerging media, like out-of-home video
advertising networks, to help each other. Why shouldn't traditional media
integrate out-of-home advertising networks into their media offering?
Certainly, they have the ability to generate content for the medium, they have
the relationships with local businesses to both sell the advertising and secure
locations for new signs on the network, and they have well-established market
research resources to assist in building new audience measurement metrics. Conversely,
why shouldn't emerging new advertising markets welcome the participation of
tradition media, which can leverage its strengths to assist the new medium in
its maturation?
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Digital Signage: LCD Panels Dominate the Market as CRTs Experience a Rapid Decline |
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New
figures from Austin, TX, based researcher DisplaySearch confirm
the rise of LCD panels as the dominant display technology.
If there were any doubt left that flat panels have become
the dominant display technology, replacing big, heavy cathode ray tube (CRT)
technology, the latest findings and forecast from DisplaySearch in Austin, TX,
should put those questions to rest.
In its Q3 '07 "Quarterly Worldwide Flat Panel Forecast
Report," the display market research specialist reveals that CRTs will account
for 5.5 percent of all display revenue in the quarter compared to TFT LCDs,
which will generate 84.5 percent of all display revenue. In dollars that's
$20.3 billion for LCD panels to $1.3 billion for CRTs worldwide.
Granted LCD technology finds homes in lots of applications
far removed from digital signage -like mobile phone displays- so there is a bit
of an apples-to-oranges comparison here. After all, how would you clip mobile
phone with a CRT display to your belt?
Regardless, in the areas related to digital signage, LCD
panels continue their skyrocket-like trajectory. Shipments of LCD TV panels
rose 32 percent quarter over quarter and 64 percent year over year to 19.4 million
units in the second quarter of this year, according to DisplaySearch. As might
be expected, the average unit price for LCD panels fell three percent quarter
over quarter and 16 percent year over year in the second quarter.
For those planning digital signage networks, that's an
important point. LCD panel pricing continues to fall meaning a significant
portion of the cost of their networks is declining. Those savings can translate
in a variety of potential benefits, including:
Broader
reach: For those contemplating expansive networks, lower panel prices can
translate into greater reach. Savings can be spent on more panels to
accomplish the network's primary mission or to fulfill secondary and
tertiary goals. For instance, a digital signage network originally
envisioned as an advertising play could be expanded with strategically
placed signs to satisfy wayfinding needs or serve as reader boards for
conference rooms.
Bigger
signs: Rather than expand the number of signs in a network, savings can be
used to acquire larger signs or multiple signs used in combination to
create greater impact.
Better
content: Savings resulting from lower panel prices also can be used to
improve content played back on the network. Not only can the savings be
used to improve the production quality of video, graphics and other visual
elements, but they also can be used to add an entirely new dimension to
the network's presentation. For example, the addition of weather
instruments to sense temperature readings can be used to trigger
weather-appropriate content. In a retail store, specific weather
conditions could trigger the digital signage media server to playback
sunscreen ads or ear muffs.
Not too long ago, TV sets connected to VCRs or DVD players
dominated what was the precursor to today's digital signage market. However, as
the DisplaySearch numbers reveal CRT sales are trailing off, replaced by what
is quickly becoming the omnipresent LCD panel.
Consumers are voting everyday with their dollars for LCD
TVs, and as they do are creating a mass market with mass market economies of
scale that benefit those who are developing digital signage networks. Choosing
wisely how to use those savings can take the success of their digital signage
networks to new heights.
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