Most digital signage project failures are because of poor due diligence & business planning. The business plan must begin with a clear articulation of the objective or purpose of the digital signage network, and exactly what you want the system to do. Common objectives are brand building, increased sales and turnover of goods, dissemination of information, wayfinding, and an improved viewer/customer experience. Business topics that must be explored and agreed upon upfront are:
- ROI. Return on Investment (ROI) is one of the most talked about concepts in digital signage. In simple terms, ROI means the value of a project defined by the amount of benefits gained minus the amount of cost invested. Return on investment deals with hard dollars spent and the expectation of hard dollars returned in a specific time frame.
- ROO. Instead of calculating success based on revenues alone, return on objectives or ROO measures returns or the value of the digital signage system based on whether objectives are met rather than hard dollars earned. It must be noted that most systems are evaluated on a combination of ROI and ROO.
- Revenue. Revenue refers to the funds that are earned by a digital signage system. This money may be simply a way to pay as you go on the refreshment of content as well as the maintenance and upkeep of the system or it may be a larger number that includes profit on the overall investment in hard dollars. Whichever the case, revenue must be accounted for in the basic business plan.
- Partnering. Most companies involved in digital signage do not perform all of the 7 Key Elements of Digital Signage in house. It makes good business sense to partner with people who have skills or resources that you do not have. In short, effective partnerships can make or break a business.
-Alan Brawn, principal, Brawn Consulting