Ask the Board – October 9, 2017 | JEFF PORTER

0

Which end-user verticals show the most potential for growth? Are there any that are at risk of diminishing or drying up?”


Digital menu boards have been the “gold rush” of digital signage for a few years now. Most of the major chains have already adopted digital menu boards nationwide (with the exception of Subway, which has been testing things for some time now). Even regional and local QSRs have gone digital.  So I think we’re going to see diminishing returns here for new installs.

More recently, mobile phone stores have been a hotbed for digital signage. In the uber-competitive environment in which they live, it is essential that telecommunication retailers deliver their “best counter-marketing message” every day (and those changes come fast and furiously). While most stores already have a digital signage network in place, they are probably on a faster-than-normal refresh cycle to “keep up with the Joneses.”

Of course, airports have always had a need for gate and flight information displays, but the number of new airports being built in the U.S. is modest. Of course, countries like China and India are adding a TON of new airports, so that can be a good opportunity if a company does business in those areas.

Corporate communications and employee communications have long been “silent cash cows” of the digital signage industry. They’re not very visible since the screens are not in public venues, but the days of cork bulletin boards are gone. I suspect this vertical has still plenty of upside. The same goes for education, although this sector is probably best serviced by a local reseller.

Casinos, gaming and sports venues have always been early adopters of digital signage. The number of new stadiums or arenas or casinos is limited (well…maybe not in Vegas), but each of these clients love to play “one-upmanship” on each other, which drives a rapid refresh/repurchase cycle.

Big box retail in the U.S. has been rather slow to embrace digital signage. However, higher-end brands have installed nice deployments in their owned and operated stores. Grocery runs on such a tight margin that they don’t often have the budget for digital signage unless a CPG (consumer packaged goods) company (e.g., Coke, FritoLay, P&G) pay for the infrastructure.

Hospitality digital signage is usually best justified as a single FAQ screen in the lobby or maybe a wayfinder in a conference hotel with small-ish meeting room screens in those venues. Again, the number of new hotels being built is probably modest, but when a hotel does a remodel, they will undoubtedly add digital to the plan. 

Roadside outdoor LED billboards are still going strong, and I expect that to continue. Municipalities are eager to remove three ugly static billboards for every new digital billboard that goes up. And, the comparative revenue for digital is very compelling. Other DOOH advertising venues can be very difficult to justify financially unless the number of locations is very large, or the target market is very focused. There is a lot of road kill in this space. Beware!!

I hope this gives you some insight as to which markets have the best upside going forward.

About Author

Founder & CEO
Porter Digital Signage

MEMBER OF THE DSE ADVISORY BOARD
Industry Consultants Council

Leave A Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.