The Digital Signage Insider

In-Store Media Networks: Does ROI Matter?

Published on: 0000-00-00

MediaPost Publications recently invited me to write an article about measuring the value of in-store media, focusing specifically on the digital signage market.  Given what I had recently learned at the Digital Signage Content Strategies Summit, I put together a two-part piece: the first takes a look at Nike's brand-centric notion of digital signage performance, and the second focuses on one of WireSpring's own customers who favors a more traditional, ad-supported model for achieving ROI.  Since MediaPost asked me not to re-publish the whole article, I've copied the first half of it here (in all of its original, unedited glory), but you'll need to go to the MediaPost site to read the full version with ROI and sales lift numbers.  Yes, there's a registration required.  But don't worry, it's quick and free :) From the article:
The common thinking among digital signage providers is that our products should generate a measurable and tangible ROI for retailers and brands.  On paper, the process seems straightforward: show a product advertisement on the screens in your stores; correlate playback frequency with sales data; and determine your overall sales lift.  This is the model that many retail firms have adopted, and the one that produces the most direct and easily recognized return on investment for DS stakeholders.  But some notable retailers have taken the stance that brand experience, not ROI, is paramount.  For them, retail fixtures, POP displays and DS exist solely to enhance the in-store experience and improve brand reputation.

For many in the ROI-focused digital signage crowd, this does not sit well.  Surely there must be some way to calculate a precise amount of value that each sign produces.  After all, we have mountains of playback and sales data to count, compare and correlate. Yet these firms hold fast to their notion of brand euphoria, and value DS for its ability to bring motion and visual impact to store environments.  But how do you define "value" in this scenario?  I wondered that myself while listening to Pat Hellberg, Director of the Brand Design Media Group at Nike, speak at a digital signage seminar earlier this year.  His group handles Nike-related digital signage projects at corporate-owned Niketown and Nike outlet stores as well as partner stores like Dick's Sporting Goods and The Athlete's Foot.  For Nike, digital signage is considered part of retail marketing, though Hellberg notes that Nike's brand-centric approach doesn't make much distinction between "marketing" and "merchandising."  Instead, Nike's internal marketing team briefs the Design Media Group on an overall brand message, and Hellberg and his team then create content that combines the relevant brand message with a design aesthetic appropriate for the target location.

How do they measure results?  Nike conducts periodic in-store research, but DS is only one of many aspects of the retail experience studied.  Likewise, the firm does split-testing for ad campaigns, but doesn't figure its in-store efforts into these experiments.  Instead, Hellberg's team relies on other implicit measurements and observations to check their progress.  Since their goal is to "define and amplify the brand through innovative, meaningful and impactful media," Hellberg and his colleagues often sit down to discuss the overall impact created by the DS.  They ask questions like, "does the content add energy to the store environment," and "does it make the brand more valuable?"  Assuming the answer is 'yes', Hellberg says the exact numbers aren't important: "We don't have empirical goals.  We constantly judge our effort subjectively, and our colleagues in marketing do the same....  It does come down to gut and instinct, which in many areas, has served Nike well over the years."
Pat Hellberg knows his stuff, but when it comes to digital signage, there's more than one way to cost-justify a network, and that's what we talk about in the second half of the article.  If you're interested in the ad-supported digital media network model, or you'd like some anecdotal evidence that it works (backed up with hard data, of course), I invite you to read the full MediaPost article.


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