Digital Signage Insider Blog

Digital Signage Sentiment Index for Q1 2012: Cautious Optimism

Bill Gerba

Two weeks ago, we called upon members of our industry to spend a few seconds filling out a three-question survey on the health of the digital signage sector. We gathered a pretty respectable 155 results and ran the numbers, and now the results are in. The good news: there's reason for optimism. The majority of folks not only said that they're better off this quarter than they were last quarter, but they also think next quarter will bring even more growth. Let's take a look at our first Digital Signage Sentiment Index and see what else we can learn from the responses.

Charting the results

A picture's worth a thousand words, so here are 3,000 words worth of pictures:

To begin with, the majority of the respondents describe themselves as digital signage services companies or network operators, which matches the sort of folks we expected to fill out the survey. In assessing their expectations for the current quarter, just over half indicate that this quarter will be stronger than last quarter. While about 30% expect modest growth of 1-20%, about 11% expect to see growth of 40% or more -- quite a feat if it comes to pass. What's more, when asked to prognosticate about next quarter, an overwhelming 75% expect additional growth, with 10% predicting growth in excess of 40%. (While I didn't do a proper cross-tabulation, a quick-and-dirty analysis does show that today's biggest optimists are also most optimistic about the future).

In both cases, those who don't expect to grow much in the near future expect to stay mostly stable, with only 9% expecting a decline this quarter and a bit less than 10% expecting a decline next quarter. While there's not much more to be gleaned from these results right now, I think they'll serve as a great base when we repeat the exact same survey next quarter and begin charting the trend over time. Plus, I'm really looking forward to seeing if our findings with this quick-and-dirty industry poll wind up mimicking the curve we've been tracking by plotting the predictions of professional analysts who follow the digital signage segment.

Finally, I would like to point out that while the digital signage sentiment index may seem similar (though much more simplistic) to industry barometers regularly released by both the Platt Retail Institute and Exponation (the folks behind the DSE), our methodologies are completely different. Our little survey is meant to be a quick gauge of optimism, and with time will hopefully illustrate whether our collective predictive abilities are any good. And who knows -- maybe this effort will spur the other two groups to do some retrospective analyses of their own data, since both have been conducting surveys for years now.

Looking forward to the next installment

If you were one of the 155 respondents who took the survey last month, thanks! And if not... shame on you! But you'll have a chance to make amends in a few months when we do the whole thing all over again. And if you didn't contribute (or just have something to say), feel free to leave your own predictions in a comment below.

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

Ideal Length of a Digital Signage Message: 22 Characters or Less

Bill Gerba

After getting some help from Steve Whitehead at Amscreen, my presentation on content best practices for the 2012 Digital Signage Expo is nearly ready. While preparing it, I looked back at many of the other content-related presentations we've put together, and I was generally pleased to see that the recommendations we made four or five years ago still hold true today. However, I was even more pleased at the two or three places where I could go in and make refinements to some of our old adages. Of those, the most useful and potentially important is about message length. As it turns out, just a few characters can have a pretty big impact on whether your on-screen message gets read or not.

What is a word?

In our pioneering (if I do say so myself) research using Amazon's Mechanical Turk last year, we discovered that increasing message length by a few words can dramatically affect recall:

But after reading some unrelated research about email marketing, I began to wonder what's more important: the number of words, or just the sheer amount of space the words take up? After reevaluating the data, I came to the conclusion that it's actually both. Very long phrases are still hard to remember, and the number of characters that make up a phrase seems to affect whether the viewer will try to read the phrase in the first place.

The ideal digital signage message length is 3-5 words, totaling 22 characters or less

The graph above suggests a pretty significant falloff in recall at the five-word mark. But upon further review, it was our particular choice of words that made the difference: messages that contained five shorter words fared just as well as four-word messages containing a similar number of characters, with 22 characters or less representing the sweet spot for recall. This makes sense, since the corresponding number of words falls well within our built-in psychological limit of seven plus or minus two elements.

Whether adding a few extra characters is really going to prevent your messages from being read and remembered probably has a lot more to do with the content on your screen, the quality of the message and the environment that your viewers are in, rather than just the number of characters. But if you wanted just a little more evidence that short, succinct messages are more likely to get remembered, consider this it.

A little housekeeping

Last week, we presented a quick 3-question survey that's designed to measure the pulse of the digital signage industry. If you haven't done so yet, please take 30 seconds to fill out the Digital Signage Sentiment Survey. We plan to publish the initial results in the next week or so and make it a quarterly tradition that we can all benefit from!

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

Digital Signage Market Stats: Too High, Too Low or Just Right?

Bill Gerba

Like many of you, I got an email from the Platt Retail Institute this week telling me that their latest quarterly report on the state of the market was available for purchase. Similar to some reports published by the DSF, the Platt report measures people's confidence levels about the current state of the digital signage market and its expected near-term growth. I like these kinds of things because they can offer a bit of perspective as to the overall health of the market. One thing I don't really like, though, is that it's very hard to gauge how accurate they are, and how they fluctuate over long periods of time. I'd like to do a little something to help correct that, but it also got me thinking about all of the other digital signage market statistics we hear thrown around. Specifically, I wondered, is there any way that we might use various research firms' numbers to keep them honest?

So, who provides some numbers we can look at?

From our article on digital signage growth rates a few months ago, we found three pretty good sources of digital signage industry statistics -- both ABI Research and IMS Research have been running the numbers on the nuts-and-bolts side for several years, and PQ Media has done a great job following the DOOH advertising industry. Each group has published at least two reports in the last few years, and each group has provided some of the critical baseline numbers and growth projections in their executive summaries and press releases, meaning it won't cost me $50K to research the numbers for this blog post.

In short, assuming that these guys didn't go back and doctor the numbers in earlier reports to reflect later findings, and also assuming that all three continued to use a consistent methodology for measuring whatever it is that they measure, all three were reasonably decent at predicting growth and growth rates. It almost disappoints me to say that the level of ridiculous hyperbole found elsewhere in our industry just wasn't present here.

As you can see, ABI Research, who had the biggest chronological gap between comparable data sets (4 years), actually underestimated market growth in 2008 -- to the tune of 32.5% in 2010 and 35.8% in 2011, assuming the methodology remained the same. If the trend holds and their future predictions are reasonably accurate, the market will continue to outperform their original expectations for the next several years. IMS Research, on the other hand, had highly consistent results, with predictions from their 2011 survey differing by only a few percentage points from their 2010 numbers. Given that their data sets are only one year apart, that is not at all surprising. Finally, in the DOOH space we see PQ Media showing bullish predictions for 2009, only to have the economic realities and corresponding growth challenges cause a massive 22% correction once the numbers were considered again in 2011. The rest of the overlapping data was much closer, and PQ's ongoing CAGR estimate of around 10% is considerably more conservative than earlier predictions.

The three research firms study somewhat different things, but they're all tempered by the overall market penetration of digital signage systems. Consequently, we can observe that PQ was generally bullish, ABI was generally bearish, and IMS was somewhat neutral. (In each case, we're talking about the precision or conistency of their predictions, rather than accuracy, since we don't have any way of verifying how their historical data is being calculated.) Generally speaking, then, the research firms are not putting out wildly hyperbolic data.

What can we do with the research data?

While each of these research reports offers a lot more than just broad industry size and growth predictions, the true value of these things comes over time, as we can compare the predicted size and growth numbers with their historical counterparts. Further, we can compile several different firms' numbers together to create a composite. This is meaningless in terms of dollar amount, but may more accurately illustrate the overall growth and direction of the industry:

I hope to keep this chart up-to-date as the various research firms publish new data in the coming years. However, given the differences in things being measured and the sporadic publication dates, this composite figure probably isn't going to be too helpful.

Introducing the Digital Signage Sentiment Survey

With this in mind, I would like to introduce a new survey which we'll conduct a few times each year. At only 3 questions long, it should be very quick to complete, and will hopefully serve as a barometer for the industry -- as well as a source of historical data. So without further ado, I present the Digital Signage Sentiment Survey, which will yield our first-ever Digital Signage Sentiment Index!

If you're reading this article in a web browser, the survey should appear below. If you don't see it, simply click this link to take the survey.

We'll publish the results in the next week or so, and then do similar follow-up surveys throughout the year. With this information in hand, we should be able to gauge the level of industry optimism at any given point, and see how the current levels compare to how we've felt in the past.

Do you work with industry research firms or purchase their reports? If so, how do you use the data? Do you feel that it provides a competitive advantage? Leave a comment and let us know!

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

Amscreen and Its Advertisers Show That Great DOOH Content Works

Bill Gerba

With Digital Signage Expo 2012 coming up, I've started working on my presentation, which is unabashedly titled "Everything you need to know about making digital signage content." Because I've figured out 100% of it. No, honest. OK, all kidding aside, this year's pitch is an amalgamation of past presentations on making effective digital signage content, refreshed with a dose of new research and recent content. Finding good content, though, can be tricky. Don't get me wrong -- there are hundreds of examples of pretty content out there on the web, and there's no shortage of designers out there who would be happy to show off their works to an eager audience. But finding effective content... now that's a different story, mostly because so few people actually know how (or if) their content is effective at all. Thankfully, just as I was preparing to harass some of my usual go-to people for examples of content that delivered results, British DOOH network Amscreen came to the rescue via a tweet. It seems they've been having a good year, and were eager to show off some of the content that helped get them there.

What can effective content do for your business?

How about boosting sales? Yes, I know it's so often talked about that it's almost a cliche. But seriously, good content can really boost sales of advertised products. It can also more effectively deliver corporate communications and safety messages, inform guests and visitors about local or time-sensitive events and explain important topics about health and personal wellness. But our friends at Amscreen built out their network to sell stuff, and that's just what their content does. To wit, based on the market research that Amscreen has so generously posted online, the following vendors found real benefits from advertising at or near the point of purchase:

Red Bull achieved a 20% sales lift of advertised products.
Budweiser achieved a 29.1% sales lift across their brand during a DOOH campaign.
Coca-Cola achieved a 36.6% sales lift of advertised products during a two-week campaign for Coke and Coke Zero products.
Lucozade achieved an astonishing 49% sales uplift of advertised products (though admittedly, these products were sold immediately next to the screens at the checkout counter, so they probably represent the best possible scenario for using digital signage advertising).

What does great, effective DOOH content look like?

Thankfully, Amscreen's customer successes are based on content that looks like it should -- simple, strategic and easy-to-read. This makes me glad for two reasons: first, more independent corroboration gives me further proof that I haven't been barking up the wrong tree with regard to content creation for the past few years. Second, it means that at least a few major brands now have incontrovertible proof that when done correctly, DOOH advertising can be extremely effective, and doesn't need to be expensive (on the content creation side, anyway -- I have no idea what Amscreen charges for placement).

For example, let's take a look at some of the spots that appeared on the Amscreen network:

As you can see from these examples, making effective DOOH content isn't exactly rocket science. In general, you want to get your message on screen as soon as possible, make it as short (succinct) as you can, and leave it there for as long as possible. Throw in some high-contrast imagery, maybe a few key features or benefits and a call to action and that's about all you need. Yes, it's nice when you showcase some true creative genius and make content that's both effective and beautiful. But if I were an advertiser, I'd be a lot more concerned about getting something that worked, rather than something that was just pretty.

The road to digital signage failure is paved with excessive eye candy and a lack of ad sales experience. While the content used by Amscreen's clients is certainly attractive (and they obviously have the ad sales thing down pat), it's clear that the visual elements are there for practical reasons, not just whimsy.

Do you have an example of great, effective DOOH content that you'd like to share? If so, leave a comment below -- and include a link to the content if you have one. (Email/RSS subscribers, click through to http://www.wirespring.com/blog to comment.)

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

How Many Ads Do You Need to Sell to Keep a DOOH Network Afloat?

Bill Gerba

I'm prepping the latest version of our annual digital signage pricing survey, and as always, the process starts with reviewing our articles and analysis from past years. This time, I also had the data from our recent DOOH advertising survey swimming through my head. As a result, I realized that we'll finally be able to make some observations about what it takes to fund an advertising-based digital signage business. If you're thinking about starting a digital signage network, or if you're a fan of our budgeting articles, or if you're just really bored, then read on.

What does it take to fund a 100-screen network?

First, the usual caveats apply. As we always note in our digital signage budgeting articles, there's really no such thing as a typical digital signage network, whether it's 10, 100 or 1,000 screens. And the variable costs of things like content, venue profit sharing and the like can considerably affect what it truly costs to own and operate a network. Still, there's no denying that regardless of size, it has consistently gotten less expensive to build out a network over the years. That's why it's so befuddling to find so many DOOH networks continually starting up and shutting down. I mean, if the enabling technology keeps getting more affordable, and there are all these experts and Internet sites out there to warn people about common pitfalls and explain how to pick business models and optimize content performance, why aren't more networks surviving?

Image credit: Amy Leonard on Flickr

Well, if the results of our DOOH pricing survey are accurate, a big part of the problem may simply be picking a pricing system that both the buyer and seller are comfortable with. As we learned, most buyers and sellers want to base pricing on some kind of reach-based metric like CPM Viewers. However, when asked how they tend to buy/sell DOOH ads, only 28.6% indicated that they currently use this approach, while 24% buy or sell on a spot-by-spot basis, and 22.1% buy or sell on a screen-by-screen (or venue-by-venue) basis.

We also learned that the median CPM Viewers price of $6.50 might be representative of what's being bought/sold in today's market, but a single number can't really capture the wide variety of networks and media prices that are out there. Consequently, buyers and sellers alike have trouble making meaningful price comparisons and can't mentally shop a DOOH sale or purchase against other kinds of media.

Let's talk numbers

We noted last year that the "average" 100-screen network takes an average of 9 people to run, with an average salary of $52.5K per employee. That's equivalent to $39,375/month in expenses, or $394/screen/month. When added to the $103/screen/month in capital expenses we calculated from our survey results, the "average" screen in a "typical" 100-screen network costs about $497/month after salaries are factored in. In other words, a 100-screen network would need to earn just under $50,000/month to stay afloat.

Regardless of how you choose to price it, the figures above indicate that each screen in the network needs to earn about $500/month. Using CPM Viewers-based pricing and our median figure of $6.50 CPM, we can thus calculate a wide range of break-even scenarios (assuming that ad buyers are buying on a month-to-month basis, there are 30 days in a month, and each viewer sees every ad once during their visit):

By combining this information with a basic knowledge of venue traffic profiles, we can get a better understanding of how the break-even analysis plays out in real world scenarios:

For a network in low-traffic venues that sees only 1,000 visitors/venue/month, you'd need to sell a whopping 77 units of ad time on each screen to break even. If those are all 15-second spots, that amounts to over 19 minutes of commercial air time (double if the spots are 30 seconds long).
Moderate traffic venues like retail stores and specialty markets might serve 150 customers each day, or around 4,500 per month. Screens in these locations would need to sell about 17 units of ad time to break even.
Meanwhile, a reasonably high-traffic QSR location might serve 1,500 customers a day. A network built in these types of venues would only have to sell about 2 units of ad time on each screen to break even, since each ad would be shown to about 45,000 people/month.
Finally, a high traffic venue like a popular supermarket can easily serve over 2,500 customers per day. Assuming that all of them came across the DOOH network's screen, that owner would only have to sell one ad-unit of time to break even. Of course, at these high volume locations, ad buyers may be less comfortable paying the full CPM price, especially in situations where it's unlikely that all customers will actually see the screen.

How should lower-traffic venues respond?

While CPM Viewers pricing clearly works out favorably for the seller at high-volume locations, there are tens of thousands of screens deployed in venues that don't get anywhere near the several hundred visitors per day needed to make the model affordable. For these networks, a flat price-per-spot-per-month model probably makes more sense. Looking back at our DOOH survey data on the matter, clients reported being willing to pay anywhere from under $20 to more than $140/spot/screen/month, presumably depending on factors like the desirability of the location, screen size, etc. Still, the math here is easy: at $20/spot/month, a network owner would need to sell about 25 spots/screen/month to break even. At a whopping $140/spot/screen/month, he would need to sell less than 4.

Of course, most network owners aren't aiming for a break-even scenario. They want to be profitable. And as you can see from the numbers above, the different pricing strategies can have a pretty significant impact on what it takes to reach profitability. They also differ on things like promotional techniques: "giving away" a $140 spot to a good customer is obviously less desirable than giving away a $20 one (even though the cost basis is probably the same: close to zero). And lowering the CPM for a "bonus" ad might cause a client to question why the CPM would be "higher" for all of his fully-paid spots.

Still, there's plenty of creativity in the industry when it comes to pricing ads on digital signage networks, and I'm pleased to see that the above combination of our two survey data sets doesn't fall far from my own observations, and the comments I've received from our customers. This makes me particularly excited about our upcoming 2011/2012 digital signage pricing survey. I don't get the feeling that costs have changed that much since our last survey, but I've been wrong about that kind of thing before. And later in the year, we'll be following up with another survey on content generation, in order to get a more complete picture of what it takes to build and run a network of digital signs, whether for advertising or other purposes.

Do these break-even estimates match up with your expectations? Leave a comment and let us know! (If you're viewing this in your email or RSS reader, click through to http://www.wirespring.com/blog to comment.)

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

DOOH Ad Pricing Varies Widely on a Per-Spot Basis: Survey

Bill Gerba

Regardless of what the cool kids (and analysts) say, I often encourage my DOOH customers to adopt pay-per-screen or pay-per-spot ad pricing. I've been making this recommendation for a long time now. Yes, media planners hate it. And yes, it's different from how an advertiser might buy any other kind of medium. But based on my experience, the typical DOOH ad seller is usually a small network, not some huge agency. And the ad buyer is far more likely to be a small, local business than McDonald's or Coca-Cola or Chevrolet. Consequently, the costs and complexity of calculating a reach metric and using that as the basis for pricing isn't justifiable for the bulk of the people who are buying and selling DOOH media. Still, our survey has told us that most people today do use reach-based pricing, and in fact, that's how they would prefer to buy/sell DOOH media when given the option. So, where does that leave per-spot based pricing strategies? Luckily, we collected a bit of data on that as well.

Buying DOOH ads on a per-spot or per-screen basis

To begin with, when asked "When I buy/sell DOOH media on a per-spot basis, I expect to charge/pay...", our respondents said the following:

This chart gives us a nice idea of what respondents feel is a fair price to pay for... well... something. While plenty of people -- nearly 40% -- outright admitted that they didn't know how to price DOOH media this way, others were more than happy to pick some numbers that they felt reflected reality. Unfortunately, there was a flaw in the methodology that prevents me from drawing a conclusion as to the typical pricing of DOOH media on a per-screen or per-spot basis. In short, responses like "$21-$40/spot/month (per screen or venue)" and "$21-$40/spot/month (network-wide)" can be taken to mean different things. When I wrote up these choices, I was making a distinction between deals where a buyer is allowed to purchase spots on individual screens of a network a la carte versus deals where an advertiser has to purchase spots on every screen in a given network. However, survey-takers could have interpreted the "across the whole network" options to either mean "I'd pay this much per screen when I buy ads on every screen in the network" or "I'd pay this much in total to have my ads play on every screen in the network." That's obviously a pretty important distinction, and even if we knew that most responses were based on the latter interpretation, it'd still be impossible to figure out a per-spot, per-screen price -- since network sizes vary from a single screen up to the thousands.

So, looking at it from any one of several different directions, maybe the average cost per spot is about $49/screen/month. Or maybe it's $90/screen/month across the whole network (whatever that means). Over the years, I've anecdotally heard everything from $10/screen/month to well over $200, so I really don't have much of a feel for which of these numbers might be most indicative of today's market. Of course, that position might turn out to be the most accurate: as multiple respondents noted in their comments, DOOH advertising networks are so diverse and heterogeneous that there probably isn't a mean or median price that reflects what most spots on most networks truly sell for.

Comparing the perceptions of buyers and sellers

With all that said, it's interesting to observe that buy-side respondents tended to skew toward higher price ranges, while sellers perceived a much wider range of pricing options:

As we discussed earlier in this article series, it's possible that our buy-side survey takers came exclusively from big agencies accustomed to buying premium placements on big networks for big fees. Or, it could be because we only had a handful of exclusively buy-side respondents, and it's easy for a small sample size to skew the results. Whatever the case, the dynamic that I expected to see -- namely, DOOH buyers trending towards lower prices and DOOH sellers trending high -- didn't show up. So, we can take comfort in knowing that the overall data isn't significantly biased toward one group or the other.

Sadly, my shoddy survey-putting-together skills mean that for now, we still don't have a good answer to the question of how to price DOOH media on a per-screen or per-spot basis. Still, I continue to like this model a lot. It's simple, it's easy to explain, and when pitched by the right networks to the right audience of advertisers, it offers an equitable way to value screen time without the need for any fancy metrics or methodologies.

Does pay-per-screen or pay-per-spot pricing still have a place in today's DOOH advertising world? Leave a comment with your thoughts! (If you're viewing this in your email or RSS reader, click through to http://www.wirespring.com/blog to comment.)

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

DOOH Networks Slow to Adopt Pay-Per-Action Pricing: Survey

Bill Gerba

When it comes to advertising, I really like the idea of pay-per-action (PPA) pricing. When Google first announced a plan to let some AdWords customers only pay when a viewer clicked on an ad AND actually made an e-commerce purchase, I remember thinking "this could totally change the way people buy online advertising." Of course, implementation challenges, fee structure disputes and -- most importantly -- general distrust of anything new ultimately left PPA playing third fiddle to the near-ubiquitous pay-per-click and pay-per-impression mechanisms. Consequently, when it came time to see what our DOOH buying/selling survey respondents felt about PPA for the digital signage world, it wasn't surprising to see that only 8.1% were interested in having this pricing scheme become the dominant one, with only 4.4% actually using PPA pricing today.

Why not use PPA pricing?

As we discussed a few weeks ago, reach is king in the DOOH advertising space. By and large, advertisers want to buy based on reach and sellers want to sell based on reach. While each party acknowledges the many shortcomings of this approach, many organizations have built up A LOT of momentum behind buying and selling media based on how many people are expected to see it. And while that approach makes sense to me for things like TV advertising or roadside billboards (both of which are aggressively pursuing more accurate measurement approaches), DOOH ads always seemed best poised to take advantage of action-based pricing -- because so many DOOH spots feature products that you can actually purchase right in the venue.

Of course, pay-per-action pricing comes with its own set of problems. For one, there has to be a clear and documentable path to purchase, and ad compliance and sales data have to be shared freely between the DOOH network operator and each host venue. As you might imagine, this also poses a special challenge to those networks spanning multiple heterogeneous venues, since the data could come in all sorts of formats, or competing venues might not feel comfortable sharing at all. Then there's the question of pricing. While it's kind of easy to justify reach-based pricing for DOOH networks by comparing it to well-established marketplaces like TV, cable and print ads, you could ask 100 people what they think the appropriate price structure for PPA is and get nearly as many different answers. In fact, if you exclude the 46% of our survey respondents who said they simply didn't know how to price ads this way, the rest of the responses covered a wide range of pricing possibilities:

Assuming you're able to pick a price that works for everyone, and have access to the data needed to reasonably prove an action was caused by a DOOH ad presentation, the burden is fully on the network operator and their content authors/providers to drive completed actions. And I think this is probably going to be the biggest obstacle to PPA gaining significant traction in our industry. With reach-based metrics, you know you're getting "soft" value, in the form of subtly enhanced product awareness and recognition -- you know, the items at the bottom of our much beloved influence pyramid, first introduced in an ROI article from waaay back in 2005:

However, with PPA pricing, if nobody buys that new product you're advertising on your screen, you (the network owner) are on the hook. And I suspect that's a position that most DOOH network owners aren't especially excited to find themselves in.

Is there any upside?

Depite all the drawbacks to PPA pricing, the chart above does suggest that media buyers would be happy paying a decent percentage for ads that actually helped them sell more product, so maybe PPA is best left as a niche tool for DOOH networks that feature high-margin goods and services. Alternatively, I could see it working well in situations where a DOOH network wants to sell spots to many different advertisers to begin with, but only keep the ones that perform. And, of course, it might turn out to be one of those "novelty business model" tactics that gets advertisers to buy in with little risk when there's simply no other way to get them onboard. One of my cardinal rules for DOOH network operators is never give your space away. But a modified "give it away if it's not working, but reserve the right to charge if it does" might -- might -- be acceptable. I'd have to think about that a bit more.

In summary, it seems unlikely that PPA will dethrone any of the reach-based media buying mechanisms. At best, it will come to fill a niche role for situations where reach-based buying is unpalatable or impossible. But what about buying and selling DOOH media based on the number of screens or venues? That's the granddaddy of all DOOH ad sales models, and next week we'll see how our survey respondents feel about it in a 21st century media buying environment.

Does PPA offer anything else of value for DOOH networks? Should the industry push it harder, or let it fall by the wayside? Leave a comment and let us know. (If you're viewing this in your email or RSS reader, click through to http://www.wirespring.com/blog to comment.)

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

DOOH Media Buyers and Sellers Prefer Reach-Based Pricing: Survey

Bill Gerba

Last week, we began looking at the pricing trends that emerged from our DOOH media pricing survey. While the analysis was only cursory, it highlighted a number of things that folks in our industry have had an incredibly difficult time investigating over the past decade. This week, we have several more insights to share, beginning with some additional detail on everyone's favorite number: the average selling price for DOOH ads.

Mean versus median pricing

In the previous article, we mentioned that the average (mean) sale price for DOOH media is about $12 on a CPM Viewers basis, with most people indicating a price in the $1-$10/CPM range. We noted, though, that there were a few people who entered very high CPM prices ($50 or more), which partly muddied the picture. Consequently, recalculating for the median instead of the mean, we learned that the median CPM Viewers price, which is probably a little more representative of what's being bought/sold in the real world, is more like $6.50.

I wanted to take this a step further and see how the price estimates differed between those who had buy-side experience and those who had sell-side experience, as well as those who had experience with both roles and those who didn't have experience with either of them. However, as you can see from the graph below, the results were quite uniform. In other words, regardless of experience level, most people implicitly "felt" that DOOH ads are worth somewhere in the $1-10 range, again with a median of around $6.50.

Note the big spike up in the $41-$45/CPM range from those with buy-side experience only. At first glance, that might seem to indicate that media buyers/planners are actually prepared to pay a lot more for DOOH than the data otherwise suggests. However, we only had a very small group (less than 10) of these folks actually complete the questionnaire, compared to 175+ total respondents, so their contribution doesn't meaningfully skew the numbers. And since those who had both buy and sell-side experience voted a lot more like everyone else, my only guess is that the handful of media buyers who took the survey and answered this question had some specific high-dollar-value campaigns and placements in mind. I don't want to devalue those answers -- there may well be a different pricing perception at the big media buying/planning agencies -- we just don't have enough data from these people to say that for sure.

Buying on reach versus buying on action

Another thing I found quite surprising was how people would prefer to buy or sell DOOH media. As we talked about last week, buying based on a reach number like CPM Viewers is currently the most popular method, probably because advertisers are used to this metric when purchasing other kinds of media. However, few seemed to be interested in a cost-per-action model that would charge based on how many viewers actually acted upon an ad (presumably by interacting with the sign, taking a coupon, making a purchase or doing some other measurable task):

Not surprisingly, DOOH sellers (who probably consist mainly of network owners) are least enthusiastic about this option, since it means more work and more risk for them -- especially since much of the sales impact comes from content these people will frequently have little control over. Buyers showed a little more interest, but still only 20% of these folks said that pay-per-action would be their preferred buying method. So I think the voice of the industry speaks loud and clear here: buyers and sellers currently rely on CPM Viewers to get DOOH deals done, and that doesn't look like it will change in the immediate future.

How much are better metrics worth?

Everyone likes talking about metrics, and how great it will be when we can scan a shopper's head in real-time as they walk into the store, pull up every last detail about them, and then beam an appropriate message directly into their brain. But how much of that is just lip service? We asked people to indicate how much they would pay for a "qualified" reach measurement like eyes-on, versus the standard CPM Viewers measurement priced out above. The answer turns out to be: "a decent amount," as you can see from the chart below:

In short, screens boasting a qualified reach measurement like eyes-on can command an impressive-sounding 32% price premium. However, this only comes out to about $4 per thousand viewers since the mean cost for qualified CPM Viewers was about $16 (though the median price was also around $16, suggesting there may be more demand for measured spots). Thus, I would say at this point that qualified reach measurement may make your DOOH network more valuable, but depending on your audience size, the cost of implementing the additional metrics may not be worthwhile.

If you're like me, the numbers above raise just about as many questions as they answer. We still have a lot more analysis coming up, including a look at the differences between the various pricing mechanisms surveyed and an examination of per-screen and per-spot pricing trends. For now, though, I'd love to hear your thoughts on the above.

Do these results surprise you? Are they higher, lower, or about even with your own expectations and experiences? Leave a comment and let us know. (If you're viewing this in your email or RSS reader, click through to http://www.wirespring.com/blog to comment.)

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

DOOH Ads Sell for Average CPM of $12: Survey

Bill Gerba

For all of the blogs, news sites and industry portals that service the digital signage space, there is scant little information about the one thing that's most important to the majority of buyers and sellers: pricing. In the past, we've tried to correct this imbalance to some small extent by doing an annual analysis of digital signage pricing. However, this only covered the cost of components and services for operating a digital signage network. It didn't look at how the screens actually get monetized. So, two weeks ago we asked the DOOH and broader advertising communities to tell us about their media buying and selling experiences. With 175+ results in hand (and a hat tip to DailyDOOH for helping get the word out about the survey), we'll now be spending the next few weeks analyzing our results and publishing the findings here. We hope that in some small way, this information will assist DOOH media buyers in making informed purchase decisions, while helping media sellers price their screen inventory in a competitive fashion.

The 5 things you want to know

Image credit: MoneyBlogNewz on Flickr

The overwhelming majority of respondents (72.3%) indicate that they buy or sell DOOH media using overall audience size/reach as a major determining factor. Nearly half (48.4%) also indicate that specific viewer demographic characteristics come into play when making a buy/sell decision.
Despite the above, when asked how they tend to buy/sell DOOH ads, only 28.6% indicated that they do so based on reach (using a metric like CPM Viewers). 24% indicated they buy/sell on a spot-by-spot basis, and 22.1% indicated they buy/sell on a screen-by-screen (or venue-by-venue) basis.
However, when asked how they would prefer to buy/sell DOOH inventory, fully 37% indicated that they would rather buy based on reach if possible.
The average (mean) sale price for DOOH media is about $12 on a CPM Viewers basis, with most respondents indicating a price in the $1-$10/CPM range. Categorically, this broke down to about 6% of respondents indicating they buy/sell for less than $1/CPM, 22.5% buying/selling for $1-5/CPM and 24.6% buying/selling for $6-$10/CPM. Of the rest, 26% indicated a price above $10/CPM, with a few even venturing above $50. 21% indicated they were not comfortable answering the question.
Almost all the inventory bought and sold is composed of ads that are 30 seconds long or less. 15- and 30-second spots were the most popular, but plenty of inventory is sold in "odd" increments of just a few seconds to slightly less than 30.

Who's responsible for all of these transactions?

Even with the advent of aggregation networks and DOOH media sales specialists, the bulk of the heavy lifting is still done by the network owners/operators themselves. More people have purchased inventory directly from networks (44.4%) than have used the next three most popular approaches combined (for the record, those were "companies specializing in DOOH ad sales" (22.2%), "professional media buying/planning organizations" (14.8%), and "DOOH consultants or intermediaries" (11.1%)). For all the hype about the way things "should" be done in the DOOH buying/selling world, only 7.4% of buyers have used aggregation services in the past. On the bright side though, that means guys like SeeSaw, rVue and others still have plenty of room left to grow.

What's next to analyze?

In the next couple of weeks, we're going to break down these results and more (including cost-per-screen and cost-per-action pricing) based on the respondents' experiences, to see if buyer and seller expectations really match up. We'll also see how some of these numbers stack up against professional analysis from the big industry research companies. And we'll have to discuss some of the shortcomings of this survey, and how they might be corrected in the future.

Finally, once I figure out how to reformat the ridiculous Excel spreadsheet that our surveying tool generates, we'll of course be sending out the raw data to all those who chose to provide us with their email address in their survey response.

Stay tuned for more digital signage number crunching. And next week -- time permitting -- there will even be some pretty graphs and charts!

At first glance, are you surprised by any of the results above, or are they in line with your expectations? Leave a comment and let us know! (If you're viewing this in your email or RSS reader, click through to http://www.wirespring.com/blog to comment.)

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

Survey: How Do You Buy and Sell DOOH Advertising?

Bill Gerba

After 11 years of giving advice on how hard it is to start an advertising-funded digital signage network without ad in-house sales experience, it's become pretty clear that a lot of people are just going to do it anyway (which is fine by me, since they all need software). Whether these folks are starry-eyed startup entrepreneurs or seasoned veterans of some other field looking for new and unique ways to grow, most feel that they have what it takes to succeed, and pay no mind to the long lists of failed networks and burned out businessmen who just couldn't hack it. However, even those who have experience and know the ropes may come up short when trying to estimate the market value for their inventory. Likewise, even seasoned advertising veterans have a hard time figuring out what they should be paying to get their clients' spots onto DOOH screens. I'd like to see if we can change that.

Yes, it's another survey

We've been blogging for a long time, and some of our most popular series come from analyzing the results of surveys that we ask our readers (and anyone else we can cajole) to participate in. In the past, we've mostly focused on budgeting for digital signage networks and the like. And to be honest, I don't really love the idea of doing lots more surveys because they are a LOT of work. However, it's hard to ignore the number of people out there who are just looking for data on how much an ad insertion should cost, or what a typical CPM for a digital signage network is. So today, I'd like to tap the wisdom of the DOOH crowds to see if we can start answering some of the most pressing questions in the industry, namely:

How much does DOOH advertising cost,
How are most people buying and selling it,
How would they prefer to buy and sell it, and
Which factors make inventory more or less valuable

Why should you spend 3 minutes on this survey?

In short, even if you subscribe to all of the industry association newsletters, buy the research reports and regularly chat with our industry bigwigs, you want to see this data. By contributing your time, you will be rewarded with a picture of how your peers and partners perceive the DOOH advertising ecosystem, including where the value lies. As with all of our surveys, if you provide your email address on the survey form, I'll send you all of the data once it closes.

Who should fill it out?

Who should fill out this survey? You, your coworkers, your clients, and your friends! In fact, feel free to pass along this article to anyone you think might be interested.

How do you fill out the survey?

If you're reading this article in a web browser, the survey should appear below. If you don't see it, simply click this link to take the survey.

When can you expect to see results?

The poll will run until some time in November, and we're planning to publish a series of blog articles with results and analysis shortly therafter. But if you leave your email address in the survey form, I'll email you the results as soon as they're ready. If you're new to the site and want to see what our typical survey results look like, I recommend you check out some of the pricing studies that we've published in the past.

We're always on the lookout for new topics to cover in future surveys and blog articles. Got any you'd like to share? Leave a comment and let us know!

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

Mobilizing the Base: Getting People to Ask About Digital Signage

Bill Gerba

As an industry, we've gotten pretty good at explaining what digital signage is. We can talk about what it does, how it's used and who uses it in layman's terms. We're comfortable working with people from just about any type of business that you can think of. And we've created a large and generally pretty good ecosystem of conferences, trade shows and industry events to give each other support and welcome newcomers to our space. For all that, though, I don't think we do a very good job of educating people outside our industry. And if we want to grow in the coming years (especially in this lackluster economic environment), that has to change.

No more low-hanging fruit

Digital signs are everywhere. As it turns out, that's a mixed blessing. On the one hand, it has been a long time (relatively speaking) since I've had trouble helping someone understand what we do. On the other hand, much of the "easy" expansion into just about every significant vertical market is done, which means that finding additional growth requires going deeper, developing new killer applications, and getting in touch with people who either haven't thought about digital signage for their business, or who don't understand the potential benefits of it yet. The former demands meaningful analyses of all the different markets and the development of end-to-end applications with clear ROI potential that can be easily explained to current market members. The latter requires the equivalent of mass-market B2B advertising -- something that isn't a slam dunk even for blue chip companies like IBM and Oracle. Either way, as an industry we're probably approaching an inflection point where the effort required to reach the audience of current non-users is significantly greater than what was required to reach them in the past.

The answer to a question that nobody asked

Image credit: Colin Kinner on Flickr

Digital signs are everywhere (see above). However, in many cases they're still practically invisible. We don't notice them at retail stores, we hardly make them out in crowded bars and clubs, and we ignore them in "captive" spaces like waiting rooms in favor of mobile devices and old-fashioned magazines. A lot of these problems could be solved with spectacular content, but let's be honest: even a team of world-class designers can't create spectacular content 100% of the time. And most of us don't have access to world-class designers in the first place. This makes pitching potential customers a challenge: virtually everyone has seen digital signs by now, but if they don't remember what the screens were doing, they clearly weren't engaged. And if they weren't engaged, what does that say about the ability of digital signs to memorably impart messages to viewers? And if you can't memorably impart new information, what's the point of using them in the first place? (Sure, there are some entertainment scenarios, but still...)

So in a very real sense, we could turn out to be victims of our own success, with the early mediocre installations taking mindshare and poisoning future deals with their average-ness. We saw this very thing happen with interactive kiosks in the early 2000s, and it was years before you could bring up a kiosk project to a CEO without him calling security to have you dragged out (or worse).

Crossing over into the mainstream

Is there a solution? Unfortunately, I don't think there's a single magic bullet that solves this problem. But for starters, when pitching a new client it's essential that you use only the best examples to showcase what the client might be able to do. I like to keep photos of top-shelf installations and short reels of the best content on hand and organized by the type of application. Are you thinking about a DOOH advertising network? Then check out these amazing, well-placed screens running this highly-focused advertising content. Doing an employee-facing safety or training network? Take a look at this tight, 2-minute loop of clips. Saying "well, you could do this or that is no longer sufficient. Strong arguments have to be made early and backed up with data, either hard (e.g. "this improved sales of our widget by 30%", or "on-floor accidents decreased 25%") or soft (the aforementioned pretty pictures of great installations and effective content).

As for "educating the base", I've seen a handful of magazine ads from big LCD screen vendors who are trying to push digital signage. But that's not going to cut it. More likely, educating the base will continue to be a grassroots effort, largely carried on by the thousands of pro AV and IT consultants who serve smaller clients. Without these feet on the street, I just can't think of any practical way to reach so many businesses and individuals in so many diverse markets (logistically and geographically). For the most part, these guys are opportunistic and will happily work on any digital signage project they happen to come across, but additional education and incentives would probably make them more effective industry missionaries. InfoComm (and to a lesser extent, CEDIA) have finally started making digital signage a more pronounced part of their focus, but more could certainly be done.

Maybe this is the new low hanging fruit...

Where will future growth come from? Creating brand-new networks or expanding on existing ones? And who will do the lion's share of buying? Big companies or mom-and-pops? Leave a comment and let us know!

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

Which Big Digital Signage Questions Still Need Answers?

Bill Gerba

In an annoying twist of irony, I got a mild case of writer's block after re-reading our recent post about The Last 200 Digital Signage Insider Articles. While that little introspective article did a good job of illustrating how I've been spending my blogging time over the past few years, it also made me think about what we should be studying and researching going forward. We've been beating the subject of making effective content to death, and the various business angles and industry news topics that we write about tend to be as much about speculation as actual fact-based analysis. So while I'm putting together my list of hot topics to focus on, I thought I'd throw the question out to the community to see if there's a consensus on what still needs to be researched and/or argued over.

Which of the big-picture questions about digital signage/DOOH still need to be answered?

Image credit: [F]oxymoron on Flickr

To tap the wisdom of the crowd (yikes), I posted that question to my Twitter, LinkedIn, Google+ and Quora accounts this week. So far, I've only gotten one response (I know, I know, people are busy!), but it was a good one. Here's what Stephen Gladden at Horizon Display replied with:

#1 - What is a digital signage network?
#2 - What is the value :)
#3 - Who are the customers in "digital signage?" The network operators?
#4 - Rhetorical: shouldn't we be speaking with brands/businesses that utilize DS, and stop trying to find ways to "make a market" for operators?"

These are all interesting questions, though numbers three and four are more introspective -- in other words, I'd love to answer them for the benefit of my own company or our industry, but I doubt they'd come up in a big customer pitch. Looking at the other two questions, though, there are a lot of articles on the web and elsewhere that try to answer them already. For example, the question of "what is the value" has been studied extensively on this blog:

Heck, we even did a series on ways of calculating digital signage ROI a few years ago (which probably needs a bit of updating):

There's obviously a lot of information out there. But as an industry, we're definitely not making a concerted effort to separate the wheat from the chaff, nor are we attempting to put forward any kind of "standard" position on things like value, measurement or ROI.

What about business models, product selection and price analysis?

Again, there's no shortage of "information" out there on these topics -- just look at this blog, for example. You want business model information? We've written not just about the basics, but even about business model myths, silly digital signage gimmicks, and even a sales paradox or two. Price analysis? Just refer to any of our annual pricing studies or the surveys that give rise to them. And as for product selection, I truly believe that there is an infinite amount of "information" on the Internet about digital signage software options, kiosk hardware, services and the like.

My point with all this: whether you hear it from me or any of the 10,000 other sources out there, many of the simple questions have already been answered. The quality and veracity of those answers -- as well as your ability to pick them out amidst all the noise of the Internet -- is a separate issue. So where does the real work still need to be done? What questions do you hate hearing from your customers and prospects? What questions do you have trouble answering? Worse, what questions do you feel you have to evade? Those are the things I'm most interested in exploring. So I'll pose the question one more time:

Which questions about digital signage/DOOH would you like to see answered? Leave a comment and let us know. For email and RSS subscribers, click the link below to access the comment form.

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

The Challenges and Opportunities of Interactive Digital Signage

Bill Gerba

In our previous blog article, we took a quantitative look back at our last 200 articles to see what we've spent time researching and writing about. At the end of the post, I asked what kind of articles we ought to be writing, and one reader suggested something on the burgeoning use of gesture recognition, "touchless" touch screens, and other means of interactivity. There are plenty of blog articles, Quora questions and LinkedIn Groups posts about the future of digital signs -- including our own discussion of innovation in kiosks and digital signage from a few years ago -- so I don't think I can increase the signal-to-noise ratio a whole lot there. However, it might be useful to explain some of the pros and cons of interactive digital signage features from a software vendor's perspective, and then look at how that impacts the rest of the value chain.

Product-centered versus project-centered business models

A long time ago, when WireSpring first got started, we focused primarily on the interactive kiosk space. A lot of our early product development work went into making our system easy for others to develop on. In theory, the software we were selling would just be a platform, and the apps would be written by customers or integrators intent on fielding a finished solution. Our thought was that by focusing on the platform, we could keep our development team small and deadlines tight, while punting the hard and time-consuming work of project definition, management and development to the client or their consultants. Kiosks were a regular topic on this blog in those early days (e.g. the importance of a call to action for kiosks and digital signs), and we hoped that our tips would help customers plan and execute their projects.

Of course, it didn't work out like that, and almost everyone who bought our platform eventually came back to us for project work as well. We consequently built everything from interactive, digital movie posters to electronic news stands, and did project plans for many more. Our goal of keeping a small team exclusively devoted to our own product development was also shot, and we spent as much effort on our clients' projects as we did on our own (if not more).

Image credit: Marcus Quigmire on Flickr

Now, having a consulting business is not necessarily a bad thing. But my partners and I never planned for this scenario (though looking back, we clearly should have). We were geared up to build a product-centric company, and none of us were looking forward to constantly prospecting for new projects with which to feed our marching army of developers.

When the digital signage market began to develop, we were excited by the prospect of once again being able to sell a turnkey solution that didn't require constant customization and project work to win every sale. In essence, "digital signage" just became one of our standard applications, built on top of the same platform that we've always used. Of course, we continued to evolve the product over the years, but now the bulk of our resources goes toward improving our product for all of our customers. Writing custom code is now the exception rather than the rule.

The difference between a digital sign and an interactive digital sign

In the middle of the last decade, as more of our revenues shifted away from what we'd call "kiosks" and toward what we'd call "digital signs," interactivity never really disappeared. There was always some interactive project being worked on. But we've noticed that as things like gesture recognition, large-format touch displays and other new means of interactivity have flourished, so too have the RFP's and customer inquiries about writing shiny new apps that can use them. Frequently, these inquiries come from people who are well enough acquainted with "regular" digital signage, and thus know that they need to feed their networks with fresh content and the like to stay relevant. But perhaps because of this familiarity, they don't quite realize that someone has to program the system in order to get it to do precisely what they want from a user interface perspective. Whether that's us (the vendor), them (the customer) or some third-party integrator is largely a matter of preference. But the bottom line is that -- as we learned from our kiosk experience -- digital signage software vendors can't possibly build out prefab interactive apps as quickly as new customer requirements come in.

Where are the opportunities right now?

So, you want to get into the interactive signage game, eh? Well, your best shot is in one of these niches:

Ready-made interactive apps: Much as an ecosystem of content providers has emerged in the past few years, we'll need a new group of companies to provide extensible off-the-shelf interactive apps, expressly designed for running on digital signs in public environments. HTML5 and Flash seem to be the obvious choices for platform development, but I'm guessing that we'll see a bunch of other things emerge, too.
Application development/integration Once an ecosystem of ready-made apps becomes commercially available, most end users still won't have the time or expertise to actually make them work. Expect current VARs to add some new skills to their repetoires. Either that, or expect a whole new crop of VARs to sweep in and handle these requirements.
Web app development: There are already quite a few digital signage platforms that will let you drop a web page or web app into a playlist and have it appear on-screen. Consequently, it wouldn't be too much of a stretch to imagine that current web application companies might want to enable specific features or tools in their products to make them better suited for these kinds of projects. With so many companies and products out there already, if even a small handful of them gave some attention to our space, we'd quickly have a large portfolio of available apps to work with.
User experience design: Just because you can get an interactive app to show up on a big touch screen doesn't necessarily mean that you should. It will take a new team of user experience designers to try out apps, suggest venue- or vertical-specific customizations, run split tests, and figure out what really "works" when it comes to putting interactive apps on a big screen in a public space. Eventually, it'd be great to see somebody establish a set of guidelines for gesture-based apps, NFC-based apps, and touch-based apps much as we've done for non-interactive digital signage. (And indeed, some of this work has been done before in the kiosk space, but there are so many new ways of interacting with a device that a lot of that information is now incomplete or even obsolete).

In sum, there is a lot of potential in the interactive digital signage market. It's growing thanks to a bevy of new means of interaction, along with a public audience that isn't afraid to use this new technology to get information and perform transactions. However, exactly what a given interaction should do and how it should be handled by the system will be hotly contested, and will necessarily drive demand for more custom (or customized) software than many digital signage software vendors are used to. While this will lead to lots of job openings for those willing to get their hands dirty, it may also slow down deployments, since the list of requirements will become larger and more detailed. Overall, I think it creates a net-positive end result for the industry, though those already wary of 18-24 month deal cycles may choose to disagree :)

How do you find the low-hanging fruit when it comes to interactive digital signage projects? Leave a comment and let us know!

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

Looking Back: The Last 200 Digital Signage Insider Articles

Bill Gerba

For the second year in a row, the summer season has turned out to be surprisingly busy. So much so that it's been over a month since I've had time to post a new blog article. So to get back into the swing of things, I looked over a whole bunch of articles we wrote recently to see if any topics jumped out as needing more attention. After reviewing the last 200 Digital Signage Insider articles, though, it was surprising to see what we actually spend time writing about here -- and also what we don't. I can't say that our focus on this blog precisely mirrors the challenges and focus areas of our industry as a whole. But since the things I tend to write about are usually brought to my attention in the course of day-to-day business, it's probably safe to say that these topics are on the minds of the customers, business partners, and media contacts that many of us interact with on a regular basis.

Which topics have we been covering?

Image credit: David Nicholas on Flickr

I reviewed the last 200 articles and placed each of them into one of ten categories:

Analysis: Articles that offer practical or actionable insights into areas not captured in other categories.
Business: Articles focused on the business of digital signage. Often these articles are chock full of math.
Content: Articles focusing on best practices for making digital signage content, or content analysis.
DOOH: Articles focusing specifically on digital out-of-home advertising networks.
Industry news: Articles about various news items and industry gossip.
Marketing: Another catch-all category to cover general marketing, shopper marketing, advertising and retail media posts.
Metrics: Articles on metrics and measurement.
Research: Articles about original research that we've conducted.
Sales: Articles focusing on sales challenges and strategies.
Tech: We're a technology company, so it would only make sense that we'd have a few articles that talk about the tech that goes into digital signage systems.

While most of the articles did tend to fall neatly into just one of the ten categories above, there were more than a few that could easily have belonged in several. In these cases, I simply put them into the "best" category so that each article is counted only once.

Which categories received the most attention?

As it turns out, we spend a lot of time thinking about the secrets to great digital signage content, followed closely by business topics, marketing and advertising, and in-depth analysis of critical industry issues -- all things that we don't derive any revenue from, ironically. By contrast, despite having spent the last decade building a tech company, I've given technology (e.g. the importance of harnessing your platform to its full potential) very little focus on the blog. Similarly, DOOH networks catch a lot of industry attention, but there are only a few that I've looked at in-depth, and even fewer I've been interested in writing about.

What does this tell us?

First off, content is still a big challenge for a lot of networks -- perhaps the biggest challenge -- and that is definitely reflected in the number of articles we've written about content. I didn't go too crazy with keeping track of cross-categorizations of the articles above, but I think a good third of the "research" articles were also focused on content, so the amount of time and resources devoted to trying to improve the digital signage content situation is actually even larger than the pie chart makes it out to be.

If the biggest batch of questions we field has to do with content, the next biggest is certainly business related. People want to talk sales and VAR strategies, vendor management and supply chain optimization, and of course, pricing, so we've spent time writing about all of those things. In fact, our annual pricing analysis tends to give rise to several other articles each year, as the price survey frequently exposes unexpected trends.

Those two piles of issues are the biggest, and I feel like it kind of tapers off after that. That fits well with our "analysis" category being the next biggest, since that pile included articles as varied as "Digital signage advertising tips from TiVo" and "Visualizing How to Add Value to the Digital Signage Ecosystem". Advertising, marketing and metrics make up the start of the "long tail" of our real-world questions, and I write about things like DOOH networks and industry news and gossip for my own education and entertainment as much as anything else (so they may or may not have anything to do with real-world questions and concerns).

This analysis has made me realize just how little the questions have changed over the years. Despite advances in technology and an increased awareness of digital screens, networks owners still have basic questions about how to make content that performs well, where they should put their screens, and how they can best monetize them. Maybe that will never change, as new people enter the industry all the time. In which case, perhaps I should just start recycling articles... :)

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.

The Two Most Dangerous Men in the DOOH Industry

Bill Gerba

Last week, DailyDOOH posted a fun little article asking a rather interesting question: Who are the most dangerous people in our industry? Dozens of commenters (mostly anonymous) proffered suggestions, naming well-known consultants, CEOs and hangers-on who love to see their names in print. The comments were fun to read and made me laugh out loud more than once, but by the time I had read them all through, I realized that DailyDOOH honcho-in-chief Adrian Cotterill had actually asked a pretty serious question. You see, "who's the most dangerous" isn't the same as "who's the most annoying" -- even though that's how most of the commenters interpreted it. The dangerous ones, instead, are those who could inflict serious damage on the industry and restrict its growth. In fact, they tend to be some of the most successful managers of some of the biggest companies in our sector.

While chatting with Adrian about a week after the post surfaced, I lamented that while some of the people mentioned in the comment thread could be pretty irritating, none really had the ability to bring considerable damage to the industry, and hence qualify as "dangerous." To do that, I suggested, you'd have to talk a big game, go out and make a go of it, and then get shot down hard enough that nobody with money would want to touch the industry after that. Digital signage technology is so pervasive these days (heck, we've seen screens mounted on everything from automatic defibrillators to milkshake machines) that it's unlikely that anything could take the whole industry down. However, the highest-visibility sector -- digital, out-of-home advertising networks -- is still pretty fragile, so I focused my attention there. My comment to Adrian (which he then anonymously posted on my behalf since I'm generally too lazy and/or forgetful to do it myself) was that if we had a few more high-profile failures of DOOH networks, it could reset that side of the industry again by driving away potential investors and entrepreneurs. My argument looks something like this:

The bigger they are...

Image credit: Ben Crowe on Flickr

I propose that Garry McGuire (CEO of RMG Networks) and Richard Fisher (CEO of PRN) are hands down the two most dangerous men in the industry, at least from a US perspective. Are they inept? Nope. Have they been leading the industry in the wrong direction? Hardly. Are they downright evil? I doubt it. But they do represent two of the biggest and most visible digital out-of-home advertising networks in the country. And when business analysts and Madison Avenue have questions about our quirky little industry, they'll be the men who get asked those questions, and whose answers will carry the most weight.

So consider what would happen if one or both of these companies were to founder. PRN has been a stalwart of the digital signage community for... well, basically forever. They've gone from being a minion of Walmart (who at one point accounted for something like 90% of their revenues) to today's more diversified company with a larger and more comprehensive suite of offerings. While I doubt they're throwing off as much cash as parent company Technicolor would like, they're a good team of smart people with a good business model, and we more or less expect them to do the right thing when it comes to digital signage. If they were to suddenly change direction, go into receivership or experience some other life-altering event, I'd be pretty worried for other DOOH networks.

RMG is in a similar position. With a pedigreed CEO and VC money from some of the darlings of Silicon Valley, RMG has made no secret of their intent to become the premier supplier of DOOH inventory in the US. Add in a big line of credit and plans for an IPO, and the firm ought to be able to back up their big talk with big actions. While they don't have the same track record as PRN, their resources and growth so far are such that any serious missteps would almost certainly make other DOOH network owners pause and consider their growth options.

Who will be the next NGN?

Over a decade ago, Next Generation Network became the poster child for how not to run a digital signage network. Having raised nearly $100M in private equity financing, they deployed thousands of screens across the United States, only to find that they had no way to monetize them. In hindsight, their lack of a suitable ad sales model and ridiculous capex requirements is obvious. But at the time, people were astonished to find them disappear just scant months before preparing an IPO filing. Their high-profile exit slapped a giant "DO NOT TOUCH" sign on ad-funded digital signage networks everywhere. This hindered the growth of companies like RMS Networks and the early PRN (which I think was called Pics Retail Networks), and surely prevented the formation of other startups that would have shared a similar vision (for better or worse).

Long story short, there are only a handful of DOOH companies that big businesses bother to pay attention to. If these guys can't prove out the model, it's going to hurt short-term investments in other DOOH companies and make expansion and exit more difficult -- even for those companies who are successful in their own niches. Unfortunately, the reverse isn't necessarily true. The ongoing success of a company like PRN or RMG probably won't translate to increased access to funds or improved growth prospects for other advertising-based networks. So for the small guys (and that's virtually EVERYONE aside from the top 10 or 20 DOOH networks), there's little to gain, but much to lose.

How much impact does the performance of large DOOH networks have on smaller DOOH companies and newly-minted startups? Leave a comment and let us know.

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What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.