What is Digital Signage?
In its most basic form, Digital signage is an electronic display that is installed in public spaces. Digital signs are typically used to entertain, inform or advertise.
The content displayed on digital signage screens can range from simple text and still images to full-motion video, with or without audio. Some operators of digital signage networks, particularly in the retail industry, regard their networks as comparable to television channels, displaying entertaining and informational content interspersed with advertisements.
Digital signage advertising is a form of out-of-home advertising in which content and messages are displayed on digital signs, typically with the goal of delivering targeted messages to specific locations at specific times.
Major benefits of digital signs over traditional static signs are that the content can be exchanged without effort, the signs can adapt to the context and audience, and even be interactive.
While the world is embracing digital signage as an emerging market, China currently leads the world in the number of digital signage displays deployed with over 100,000 displays installed and an estimated collective market capitalization of over $10B.
Digital signage is used for many different purposes including:
- Information – examples include flight information in airports and wait-times for the next train
- Advertising related to location – examples include in-store promotions in a retail establishment Advertising by third parties – digital advertising companies that sell advertising space to local merchants/service providers, media resellers and national advertisers. Enhanced customer experience – examples include digital signage in Doctors office waiting areas to reduce perceived wait-time and offer demonstrations Influencing customer behavior – examples include post office digital signage that directs patrons waiting in line to automated stamp machines and retail digital signage designed to direct customers to different areas of the store, increasing the time spent on the store premises
- Brand building – examples include stores where digital signage in video form is used as a part of the store décor to build a story around the brand
- Follow through campaign information to store manager – examples within chain establishment
- Environment enhancing –such as using digital signage to increase the customer experience with the building itself, examples of this are where digital signage panels are used on the floor and react to how and when an individual moves over them.
- Digital signage can also be used in a corporate environment, for example by disseminating information throughout a company via screens in reception areas and canteens.
Digital signage in the broad sense has been in use for decades in the past in the form of LED ticker signs and LED video walls. However, it has yet to become a major public medium, mainly due to the following negative factors:
- Uncertain ROI – the costs of deploying digital signage can be high. Not only are large outdoor screens expensive, but the much more common, and much cheaper, digital signs based on LCD and plasma screens can still represent a significant investment when a large network is planned: the cost of installing one screen in, say, each restaurant in a large fast-food chain could run to millions of dollars. Any investment of this magnitude has to be justified by a clear ROI plan before receiving approval.
- Unproven advertising effectiveness – like the Internet in the early 1990s, the digital signage medium has not yet been widely accepted as an effective advertising medium when compared with traditional means.
- Lack of interoperability – digital signage products today are mostly closed, proprietary systems. It is impossible to advertise across digital signage networks running different solutions, making the emerging media inferior to nationwide advertising media such as the television and the Internet.
- Complex value chain – a digital signage network can involve at least the following vendors: displays, media player, management software, project planning, installation, field service, network connectivity, bandwidth, content creation, and advertising sales. Managing such a complex value chain is a daunting task and all parties involved may introduce risk factors to fail a project.
- Lack of understanding – despite considerable media coverage there remains a general lack of understanding about the requirements for the successful use of digital signage. This relates to brands and retailers but also, disappointingly, to some vendors. In particular many people responsible for content do not, as yet, have a clear idea as to what works most effectively.
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