Article
Digital signage 'log jam' causing delays, offering opportunities
While growth numbers look good, there is a logjam in digital out-of-home — but it's a problem rife with opportunities for those willing to help clear it.
May 13, 2010 by Lyle Bunn — Strategy Architect, BUNN
A "log jam" has been holding back digital signage deployments and revenues. The numbers may look good – particularly in this economy – but a log jam nonetheless exists.
Even though the problem is largely hidden because the sector at large has been growing at reported 23 percent-plus compound annual growth rates (CAGR) and many suppliers are enjoying double digit growth and have been through the economic hardships of the past several years. Synnex Corp., for example, has had 74 percent year-over-year growth in digital signage.
Despite this clear growth, there remains a substantial, pent-up demand of projects and purchasing, which means that intended projects are slow to move toward deployment, and build-out rate is delayed.
This means that the full benefits of digital signage and digital place-based media are under-realized by end-users, while many individual suppliers and integrators experience slower revenue growth, challenges in forecasting and higher cost of sales due to extended sales cycles.
The log jam is an economic bottleneck for those affected, but it is also a huge opportunity for "de-jammers."
There is a lack of accurate information about return on digital signage investment. While every suitably planned deployments shows significant results and achievement of communications goals, the competitive value of the deployment results in little performance information being placed in the public domain. Non-disclosure requirements placed on suppliers mean that often this information cannot be used to advance similar projects.
There is confusion about technology and sourcing options.Many projects have long "product investigation" and sourcing cycles, often resulting in greater confusion. Since the response to confusion is generally "no," the time and energy needed to plan and advance projects is increased and the "return on time" invested decreases.
There is a lack of use of proven structures for advancing digital signage projects.Digital signage is a business application that applies information technologies. By cutting corners on system development life cycle processes that are typical of business application planning and deployment — and focusing on technology selection and sourcing — the milestones and checkpoints of investment do not occur as project elements, which stalls and distorts project progress.
There is a mountain of information about digital signage available.The logjam is exacerbated by the cumbersome nature of trying navigate through all the information in order to garner useful information: it being too high level, not specific enough, supplier-biased or more opinion- than fact-based.At the same time, there appear to be solutions to each of these problems, and the digital signage "de-jammers" that bring these solutions to market will reap the rewards.
End-users are willing to listen, draw from, hire and source from credible sources of perspectives and experience. So doing just a few things could position a supplier of that credible perspective as a credible "go-to" resource – resulting in projects moving forward, revenue flowing and unfilled demand being met.
Among those few things are included a few easily-achievable examples:
1. Become knowledgeable about digital signage in the area of the market and uses that most applies to you — and then leverage this growing knowledge into new areas.
2. Drill deep and keep searching for return on investment (ROI) information. This ROI information is a key tool to assessing project opportunities, winning credibility and defining/monitoring project success while refining, tuning and advancing the project.
3. Learn about the technology options generally and then deepen your knowledge of a range of tools applicable to your focus. It is of critical importance to know how technology elements inter-relate and interoperate, in particular as they apply to the total cost of ownership and the operating costs associated with different options.
4. Learn and use proven structures to identify, plan, deploy and operate digital signage. These are available through a variety of educational programs. Look for programs provided by those who have actually planned and deployed networks, can provide vendor-neutral instruction and are approved by industry associations. Programs included as part of a conference or multi-supplier event are also useful.
Photo courtesy of rjones0856.
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