Digital signage continues to grow at double digital levels as a messaging, advertising and engagement medium as evidenced at Digital Signage Expo (DSE), the premier industry event held annually in Las Vegas.
DSE 2016 suitably started on Pi day (3.14 or March 14th) and ended on St. Patrick’s Day. The formula Pi r squared (Pi*r2), used to calculate the area of a circle, reflects the many circles of influence that digital media has as it is used where people shop, visit, gather, travel, work and learn. Ending with the jubilation of St. Patrick’s Day was also suitable as the medium continues to grow in application, fueled by the need for improved communications spending, better engagement and ever-improving technology price/performance.
During DSE 2016, end users discovered new ways of benefiting their organization, network operators heard of new directions to maximize advertiser value and integrators learned better ways to serve their customers.
Over the past year, end users have made significant advances as retailers, food service providers and consumer service brands have turned their attention to location-based engagement using digital media. Messaging and interactive media is increasingly used for staff, visitor and student communications.
Many suppliers have also had significant advances. Stratacache acquired PRN in enhancing its operational, analytics and ad sales/merchant engagement capabilities and has become the largest digital media provider to offer end users a complete solution. ADI Global established its digital signage line of business for security integrators, and LG Electronics introduced new display form factors and OLED.
“Digital display is at the convergence of the $125 billion in retail technology investment and $170 billion in annual advertising spending, which includes $7 billion in dynamic out-of-home advertising,” noted Mark Boidman, manager director at P.J. Solomon in the opening address of the pre-show Digital Out-of-Home Summit hosted by the Digital Place Based Advertising Association. “DOOH is the only traditional media sector that is expected to grow,” he noted, adding, “In the past 10 years, the cost of digital signage technologies has been cut in half.”
“Advertising-based networks wishing to accelerate advertising revenue must engage with automated ‘programmatic’ media inventory display, planning, buying, flight execution and measurement in order to reduce the cost of business” said Barry Frey, president and CEO of the Digital Place Based Advertising Association in chairing the Out-of-Home Summit. Programmatic offers real-time optimization.
“Smart Cities are a $1.5 trillion-digital-media opportunity as urban problems are solved and opportunities are addressed through the use of the media for wayfinding, transportation, alerts and public space communications,” Boidman added.
In addition, an exciting array of new digital engagement media was introduced at this year’s show. Many providers introduced new products, services and concepts of operation.
Stratacache unveiled broader end-to-end capabilities and its “Store of the NOW” program aimed at supporting retailer and brand needs to implement digital media for immediate ROI while positioning for wider organizational deployment and future-proofing.
“With so much noise around creating the store of the future, retailers tend to forget that proven technology, available today, combined with engaging content, is what will amplify incremental sales chain wide” said Chris Riegel, CEO of Stratacache, adding “Don’t worry about the store of the future, worry about the Store of the NOW. If you really want to move the needle, you have to drive successful execution at scale, not just at flagship stores. Stratacache has been successful in driving incremental change in-store through digital experiences that will create long-term sustainable ROI.”
LG Electronics showed the engaging power of new display sizes and ultra-thin bezels and unveiled the new generation of flexible OLED display. “LG has continuously introduced innovation,” said Garry Wicka, LG USA head of marketing. “From Cathode Ray Tubes (CRT) to plasma to Liquid Cristal Display (LCD) to Light Emitting Diode (LED) and now to Organic Light Emitting Diode (OLED), each generation of LG display innovations has improved the price/performance proposition.”
New approaches to display add to the architectural engagement, ambiance and vitality of an on-location experience. Display and media management systems have reached new heights in their ability to make an emotional connection.
The range of ultra-high quality artistic, branding and promotional imagery and video that can be presented allows digital place-based media to significantly add to the showcase of a location experience. This is particularly true where the heritage or the excitement for a brand or retailer is core to its marketing proposition.
Displays with sunlight readability encased in ready-made enclosures for outdoor use as community notice boards, on-vehicle signs, quick serve restaurant drive-thrus, etc. were also showcased at LG, LG-MRI and others.
As New York cab patrons well know, sunlight readability and rugged design allows for stunning on-vehicle displays. Beyond the thousands of dollars being generated in ad revenues, on-vehicle display enables the firm Oscar to provide vehicle use at no cost, reflecting an innovative business model for the medium that could find its way into trucking and delivery vehicles.
Intel showcased consumer engagement based on new detection and interfaces underpinned by the Internet of Things (IoT). “Over 70 percent of digital media players worldwide operate using Intel technologies,” said Jose Avalos, director, digital media at Intel, adding “advancing the return on investment is the ongoing priority of the sector.”
Shikatani Lacroix Design Inc. presented case studies on how digital media can provide an immersive experience in retail and banking environments emphasizing that “one size does not fit all.” “The digital experience must fit the brand and the consumer’s need,” said Richard Dirstein, EVP, design and innovation at Shikatani Lacroix.
Amplifying the brand for “now” is key
In a keynote address, David Meerman Scott, author of The New Rules of Marketing and PR, emphasized that “In marketing, content matters.” “Selling is a cycle, but the sales cycle is now the buying cycle with sales going to the provider that best engages customers.” Scott advised marketers and their partners to live “in the now — to plan for now with dayparting and contextual content.”
“The communications revolution is upon us now and is changing everything,” Scott said.
He advised DSE delegates to “be agile, use the data and amplify your brand by ‘newsjacking’ — the practice of profiling your brand as you add to public and social commentary.”
In reflecting on the critical importance of, and demonstrating successful tactics in the merchant-retailer collaboration and messaging strategy, Steve Hargis, director, film & video productions for Bass Pro Shops recommended two books including Look at More: A Proven Approach to Innovation, Growth, and Change by Andy Stefanovich and Don’t Make Me Think by Steve Krug.
The APEX awards at DSE 2016 recognized best practices in digital place-based media application and improving customer experience. Second Story received three separate awards. Matt Arnold lead engineer accepted the awards for this Sapient Nitro company. Many other installations were also recognized based on the merits of their messaging and customer engagement including Scotia Plaza by Cineplex Digital Solutions and Sport Chek by FLG. The key message in the APEX awards is that once the display infrastructure is in place, content really is king. Brands must tell their story and sell their story.
Measurability drives success
2016 is defined as the year of measurability. Investment validation and optimization based on impact assessment is characteristic of successful digital signage applications, and is clearly missing in cases where projects are struggling for executive sponsorship.
Chris Riegel, CEO of Stratacache said, “Digital signage provides new ways to truly measure consumer behavior and allows us to learn about shopping patterns. From an analytics point of view, Stratacache’s all-in-one interactive tablets operate almost like a Trojan horse within the retail store. They contain so many ways to monitor and support understanding of what serves the shopper. These devices help brands and retailers better understand customer behavior, and we can use those real-time insights to optimize the physical space almost like a website”.
In sharing their research findings on the impact of product presentation on digital menu boards, Andrea Ehresman, senior marketing manager and Jesse Briedinger, senior customer marketing manager at TheCoca-Cola Company, offered neuromarketing insights such as:
- Since digital signage is inherently commanding and can therefore engage consumers at a higher marketing level, the call to action should be an invitation.
- Product photos are more impactful when placed to the left of related text.
- Product images are more impactful when presented as the product will be served.
- Digital signage has a “cathedral effect” where eyes naturally go to the top of the display, making this valuable display space.
- “Celebrate the curve” by reducing sharp corners in content layout.
Integration is a core theme
The integration of digital signage into the physical environment and the path to purchase experience was an over-arching theme at DSE 2016.
As communicators seek better value, and the application of the media has become more encompassing, integration is more complex. Using data feeds (i.e. weather, news, events, social) and application data (i.e. production, point-of-sale, inventory, loyalty, etc.) provides greater context and relevance to messaging, but communications objectives and content strategy must be considered more deeply.
Projects involve more end user departments and have escalated within the business in support of needs for better engagement, reduction of costs (i.e. safety), regulatory compliance (i.e. caloric posting), battling “showrooming,” unified communications and overall competition for attention, time and spending has increased.
Integrators that just respond to identified needs are losing business to integrators who understand the end users’ business and bring solutions. Digital signage is a knowledge-based business.
Problem areas: Despite the high growth in all areas of digital signage, DSE 2016 offered a snapshot of ongoing concerns within specific deployments and the application of the media at large.
- Initiatives fail to take advantage of the digital media supply chain that includes content authoring and re-purposing related to other communications devices, connectivity, commercial display capability and media management that can increase content relevance and minimize costs for better ROI.
- Analytics related to business value (i.e. ROI) that underpin digital signage planning is often inadequate to validate investment. Impact assessment is commonly not undertaken at the level that would enable optimization toward the higher level of ROI.
- While technology elements appear to be simple, elegant and straightforward, the selection of the most suitable components from a range of options that comprise the technology ecosystem is resulting in higher operating costs than necessary.
- Content delivers the value of place-based messaging once the technology infrastructure is in place, but too often, this aspect of operations is under-resourced and inadequately planned or executed to assure high value from the medium. Increased focus on engagement strategy, messaging tactics and content composition as well as “right-sizing” investment to optimize content for business value is required.
- Integration of system elements and installation can be provided by a wide range of audio/visual, information technology or security integrators as well as static sign providers and experience agencies. Many are operating as product re-sellers, and most are very prescriptive in bringing limited value or experience to the end user. Since digital signage success is knowledge-based, integrators must maintain currency with the tools and approaches that deliver higher value to end users.
DSE offers an excellent snapshot of the innovations, opportunities and challenges of the very high growth digital signage sector, which rewards the end users and suppliers that best plan, operate and optimize the enabling value of the medium.
Plan to attend DSE 2017 in Las Vegas, March 28-30, 2017 to improve your digital media success, while in the meantime, drawing on expertise and resources that are available.
Lyle Bunn is North America’s longest-serving independent analyst, advisor and educator. He has assisted hundreds of end users in the planning, funding, design, sourcing and optimization of their digital media initiatives and has helped to train thousands of end user and supply professionals. Lyle@LyleBunn.com