Hercules Networks

What is Digital Signage?

Digital Signage refers to the electronic displays that we see outside of our homes. They are screens that can be found in public environments such as malls, as well as private locations, such as office buildings. Advertising through digital signage is often known as "digital out of home" or DOOH.

With a projected growth of 33% in 2009 according to ABI Research, it is important we understand this new form of media.

Uses of Digital Signage

Information and Announcements: screens can be used to provide relevant information to people who pass by, such as directions, news, and wait times.

Advertising: digital signage is often more captivating than traditional static media, and can be used to build brands, give relevant on-site advertising, promote sales, etc.

Entertainment: customer experience can be enhanced by entertainment, which may come in the form of short videos, interesting information, or other media.

Digital Signage vs Traditional Media

ROI (Return on Investment)

Digital signage is often seen as a high-investment form of media - and to an extent, this is true. The cost of the screens as well as the production costs of creating the videos tends to run higher than costs of traditional media such as billboards and signs.

However, as LCD screens become cheaper, and the cost of installation of digital signage drops, studies are showing that the ROI of such advertising is exceeding that of traditional media. The two main advantages of digital signage are its ability to target certain audiences with dynamic content, and the stronger impression that audio/video leaves as opposed to static images.

Compatability and Standards

In the past, places with different platforms for digital signage often had different protocols and standards for displaying content.

Today though, more organizations are developing and adhering to standards that will promote interoperability between digital signage platforms. Higher interoperability leads to more direct competition between suppliers, which boosts the ROI of participating in digital signage.

Value Chain

Digital signage networks can involve many parties. There may be seperate groups involved for each aspect: displays, media player, management software, project planning, installation, field service, network connectivity, bandwidth, content creation, and advertising sales.

More recently, this complex value chain is being consolidated so that it is simpler to use digital signage. In dealing with our ACM's, for example, we cover the displays, media player, software, installation, network connectivity, bandwidth and advertising sales. In addition, companies can sell advertising themselves, making the process not only simple, but scalable.

Awareness

Though digital signage is an extremely effective form of advertising, and many other countries have embraced it, the United States is still hesitant to turn away from traditional ways to advertise, such as through televisions, magazines, and posters.

However, as we move into the new decade, more and more advertisers are learning about these opportunities and jumping on the trend. There have been many trade shows and conventions that focus on digital signage and its future, and things are looking bright.