Digital Signage: Issues

Though Digital Signage (through LED ticker signs and LED video walls) has been in vogue for decades in the past it has however, not yet become a major public medium. The following are the likely reasons:

** Uncertain ROI: The cost of deploying digital signage currently stands prohibitive. Not only are large outdoor screens expensive (the LED signs in front of the Las Vegas Wynn Resort cost $15 million, for example) but much more common & cheaper form of digital signs based on LCD and plasma screens still represents a significant chunk of investment when a large network is planned.

For example, the cost of installing one screen in a single restaurant in a large fast-food chain runs to millions of dollars. Any such investment 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 a cost-effective advertising medium compared to the traditional means (TV, radio, flyers, etc.);

** Lack of proven technology –The technology used today has largely been originated from consumer-grade personal computer and DVD technology, which has not been designed to stand up to 24x7x365 pattern. Today, the demand by professional digital signage is 24x7x365 usage. Often under stress these systems can break, resulting in damage to brand image and liability disputes between advertisers and network operators.

The above issues are being addressed in the following ways:

** ROI: Studies have shown digital signage to be effective in aiding customer recall and retention of displayed information in large-scale merchandising applications, especially taking into account the downward trend in LCD panel and playback device prices. Today a small-scale retail or restaurant digital signage installation can be implemented for just $4-6,000, whose ROI may be realized immediately.

** Outdoor advertising picking up momentum – advertising dollars have been consistently shifting from traditional media such as TV and radio into outdoor advertising, creating a double-digit-growth new advertising segment which includes digital signage. However, ad agencies are still slow to explore the potential of out-of-home TV.

** Development of dedicated platform solutions – new technology has been developed that features reliability magnitudes greater than consumer-grade technology. Like professional TV broadcasting systems, the new technology enables worldwide content distribution and playback to stand up to the test of time.