||Home | Site Map | Buyer's Guide Search|
|Event Calendar||Article Archive||Message Boards||Classifieds||Product Showcases||News||Advertise||Search||Join Now|
Taking Advantage of the Digital Signage Opportunity
By Jeff Burton, Digital Printing Analyst, SGIA
To get a better sense of how companies can enter and grow within digital signage, we talked with a panel of experts: Three professionals steeped in the digital signage industry, and two SGIA members currently taking advantage of the digital signage opportunity.
SGIA: What is the best way for companies to gain more knowledge about this market?
DeManss: There are Web sites, whitepapers, market research and blogs available (Digital Signage Today has a number of white papers). While these help educate, they all approach signage from different perspectives and often confuse the issue. The best method is to engage with a manufacturing company to act as a partner. This provides not only solutions but also the consulting services that will allow you to design a network based on your needs and not try to sell you something that makes you modify your needs/goals based on what is currently available.
Neuhoff: There are a lot of trade forums and technology user groups out there that everyone has access to, and that you can contact or work with to get answers to your technical questions. The reality is that from a strategic perspective, that is really not the issue. The real issue is how you are going to create and manage the content that gets sent to the displays.
For a traditional point-of-sale provider, content creation and management is more in line with their current product and service offering. It's recommended that they focus their efforts on that piece of the puzzle and not try and boil the ocean by trying to develop the IT infrastructure required to actually implement and manage the network. Think of it just like you think about your current print production and fulfillment operations, only in this case, you are dealing with electronic digital imagery.
Acquista: Black Box offers an array of digital signage educational materials including Web tutorials, whitepapers and our successful online digital signage certification course, which we offer free of charge to our authorized DS resellers and integrators.
SGIA: How would graphic imagers who are new to digital display signage find consultants and partners? Who would you look for?
Markley: One of the things we learned about digital signage after we had the technology side of it accomplished was that it is really a "content game" that you find yourself in. We have found that Web developers are good partners when you start talking content creation. They have always needed to create content to service their Web customers and usually have some very competent people on staff that can offer assistance in this area.
DeManss: There are some experts in the industry. Other experts are in AV and IT resellers (though probably competitors), and some expertise in manufacturers. Most distributors will offer some assistance as well. There are differences in the levels of expertise and value to the SGIA member. Our recommendation is to work with a partner who can help guide and adapt the business based on the SGIA member's ability to invest, manage and grow the network.
Neuhoff: I am making the assumption that most of the readers of this article have roots similar to mine and that they don't have a bunch of money lying around that they can invest in consultants who can help develop this strategy. So I would turn my attention toward building strategic partnerships with organizations that have skin in the game and are willing to invest time and energy in exchange for a projected return on that investment. Those partnerships can be with media companies, production companies, network infrastructure companies and OEM hardware suppliers. What is important to remember, however, is that if you are considering getting into this business now, you are not an early adopter.
So before going down any of these paths, it's importat to develop a strategic plan with some key differentiators and present that in the form of an executive summary to some of your selected customers to gauge their interest in the technology. If you can find a customer that has enough interest that they would be willing to work with you on the development of the system and strategy, you are one step ahead of the game. Conversely, if you have a customer that has already adopted the technology and it is eating into your revenue stream, I would try to find out from them what the pinch points are with managing the system and see if you can provide a solution. I can almost guarantee that their biggest issue is going to be content development and management and therefore, that is where you may want to focus your efforts.
SGIA: What types of display systems do you think are amenable for small business owners to sell successfully?
Diaz: Keep it simple. The less IT involved in deploying the system the better. The market is flooded with enterprise caliber solutions when the reality is 75 percent of the signage market just needs robust but simple systems that can deliver and manage simple static content and or slide show type video content. This type of system (we call them digital and video posters) closely relates to what is being done in the traditional signage marketplace, so it stands to reason that would be the easiest way to penetrate with their existing clientele.
Markley: We have used our digital printing technology in conjunction with the digital signage. It's a natural combination for the production of video kiosks and other types of informational displays. You can really distance yourself from the competition when you combine these two very complimentary technologies.
DeManss: It is dependent on the needs and application of the SGIA member. LCDs are excellent for bright, well-lit environments and static images. Plasmas are excellent for controlled lighting environments, marketing where color accuracy is key and motion video. LED and LCDs are a good compromise between the plasma LCD meeting in the middle (but at higher cost). LED boards are excellent for large outdoor venues. Other questions are key as well - how to mount, what drives the content, where is the content hosted and interactively required.
Acquista: Other commercial categories of displays can include video walls, kiosks, touch screens, outdoor or weatherized displays, high-bright LED modules and 3D displays.
Neuhoff: That is a hard question to answer because I don't think that there is a one-size-fits all solution for all of the different applications that exist in the marketplace. I would focus my efforts on display systems that are appropriate for your primary market. What works well in mass retail is not necessarily appropriate for convenience retail.
One of the biggest mistakes that people can make with digital signage, or any other new technology for that matter, is trying to be everything to everyone. Narrow your focus so that you can deliver a truly innovative and effective solution to your target market. If one of your customers is struggling with some aspect of their POS program, it's reasonable to assume that other customers in the same market would be experiencing the same sorts of issues. If you can tailor a solution that solves these problems you will have a real strategic advantage over your competition.
SGIA: What about "turnkey solutions," and what formats (kiosk small network, etc.) does this type of solution come in?
Neuhoff: I am sure there are turnkey solutions out there, but honestly that is not a business that I would want to be a part of. If that is your business model there is really nothing to differentiate you from your competition other than price, so all you are left with are significant margin pressures right out of the gate. That is certainly not a position you want to be in when trying to develop a new revenue stream.
DeManss: For simple installations or small businesses, these turnkey solutions are a good choice. In my opinion, most offerings are not ideal for an SGIA member who is perceived to want to grow and expand their business and stay up-to-date as technology evolves.
Some "turnkey solutions" are developed by a single entity that is an expert in one area and pushing their capabilities in others to make the solution work. This leads to issues later with support, software versioning, scalability and compatibility. We offer a type of turnkey solution, but it is with other industry partners whose business is successful already without us. Meaning that experts are working with experts to take the confusion out of the process for the SGIA member while addressing the shortcomings of other "turnkey" solutions.
Markley: We have really not been involved with "turnkey solutions." So far we have found that we need to create a custom solution to be most competitive on price and at the same time give the customer all the flexibility that they require.
Diaz: Turnkey or plug-and-play is the goal for most digital signage providers and or vendors. As a vendor we try and provide plug-and-play solutions to simplify the integration process. System costs and mark-up aside bottom line profitability and ROI will be realized with how much or how little labor is involved in deploying the system - more importantly, how much effort is involved in maintaining the system after initial deployment.
SGIA: What are some of the issues traditional graphic businesses have when trying to enter digital display signage?
Markley: I think the biggest fear at the beginning is the technology side of the product - it has some new twists associated with it that take some time and effort to become familiar with things like who the suppliers are of the components and what kind of hardware is appropriate for a particular application. However, you will eventually find that content creation, as I mentioned earlier, is the major element that determines success. Without content you really don't have much to sell and once a system is sold, content creation becomes a potential source of ongoing business with a customer.
DeManss: Fear of the unknown. Much of the traditional graphic business contains digital elements already. The big adjustments are in the delivery and refresh process, which will require significant changes. While digital is arguably more cost effective in labor, it comes with higher maintenance and a learning curve. This can be offset with new revenue opportunities because of the flexibility of the digital medium.
In the end, the technologies if deployed with some forethought can often be complimentary. There are strong advantages to both technologies and by providing some additional support through video, rotating graphics or "interactivity," the overall success of the campaign can be measurably increased.
Neuhoff: The issues are going to be everything that I've mentioned already, as well as investment capital, subject matter excellence, timing and probably most importantly is mission creep. If you are really considering getting into this business, your target audience is going to be your current customer base, and the question is are they going to be willing to buy an expensive technology-based solution from an analog graphics supplier? That can be a very difficult transition to make, which is why I recommended trying to align yourself with a customer right out of the gate or to focus your efforts strategically on certain aspects of the digital sign network solution. The most obvious transition where that is concerned is content creation, delivery and management.
SGIA: Can you better define the segmentation within the display industry for members?
Acquista: Displays can be broken down in two categories: Commercial and consumer. Since the majority of digital signage projects are commercial in nature, we recommend and specify commercial displays.
DeManss: Even segmentation is somewhat confusing. Digital signage segments - retail advertising, retail branding, digital menu boards, digital outdoor, corporate communications and customer segments, merchants, restaurants, corporations, education, government and hospitality - have a message typically developed in a marketing department to communicate, however the process varies wildly.
Diaz: The residential/consumer display industry - TVs. These displays are engineered and manufactured for mass production for the consumer market. The commercial display industry focuses on engineering products made and more importantly warranted for high-duty cycle applications like digital signage. If a display is being used more then six hours a day, you're going to want to use a commercial-grade display.
Jeff Burton, digital printing analyst for SGIA, has served with the Association since 1998. He provides solutions to digital printing production, computer and workflow issues as well as digital equipment and vendor recommendations. Jeff received his B.S. in photographic science from the Rochester Institute of Technology and is a certified G7 expert. email@example.com
This article appeared in the SGIA Journal, May/June 2011 Issue and is reprinted with permission. Copyright 2011 Specialty Graphic Imaging Association (www.sgia.org). All Rights Reserved.
© Copyright 1999-2019, All Rights Reserved.