Sources including aka.tv, VisualStore, and Convenience Store News are reporting that Kroger supermarkets is planning to install a new dynamic signage / in-store TV network in their 2,500+ locations across the US. To this end, they have partnered with In-Store Broadcasting Network
(IBN), a company largely known for its pervasive audio networks in
retail venues. While the company might be unfamiliar to some in
the digital signage industry, IBN is a venerable force in out-of-home
advertising, managing audio networks for major retail chains including
Walgreens, Rite Aid and Meijer. In fact, Kroger themselves
already use IBN's audio advertising network, so an expansion into
digital video signage makes sense for them.
So just who is
IBN? Well, according to their own website, their network extends
into all of the top 100 designated marketing areas (DMAs), and they
reach over 100 million (unique?) household decision makers.
According to their press release,
they provide media exposure to more than 256 million shopper visits per
month in over 17,000 grocery and drug stores in the US and
Canada. These numbers look more like metrics for a popular
website than an in-store media service, but I suppose that it takes a
lot of shoppers to keep 17,000 grocery and convenience stores in
business. While on the subject of the press release, I
particularly liked this quote from Pierre Bouvard, president of
Arbitron Retail Services: "Our retail media studies clearly indicate
that consumers like in-store media if executed properly. It's
tremendously appealing because it permits terrific reach and frequency
at the place where it has incredible influence -- at the point of
sale." Concise, easy-to-understand, and validating the
industry. That's the kind of quote that I like to see coming from
Arbitron :)
Looking at the service in more detail, IBN's primary
business is to create and syndicate custom audio streams to each of
their partner stores' locations. They combine informative and
entertaining audio content (like beauty tips, car care information and
financial news, depending on the venue) with 30 second audio ad spots
that play once per hour, with a minimum of 14 times per day, 7 days per
week. They note (on this page)
that their primary advantages are "time sensitive, price based
promotions," "flexibility and customization" (of content and
advertisements), and the ability to "break through the visual clutter" (my emphasis added).
Now that last point will probably catch your attention, as it did mine. From their website (same page as before):
"In-Store
Broadcasting Network delivers audio ads exclusively and ubiquitously so
you can break through the visual clutter that is pervasive in a growing
number of stores and reach those that do not visit every aisle during
their shopping trip. With In-Store Broadcasting Network, you can reach
shoppers whenever and wherever they are in the store and when it
matters most - at the point of sale."
I completely agree
with the latter part of that statement - any number of studies have
shown that point-of-sale advertising is effective precisely because it
influences shoppers during their decision making processes. And
audio marketing/advertising certainly does have some advantages - the
ability for shoppers to passively consume the content without always
paying attention, for example, or the ability to be heard pervasively
throughout an area without having to focus their eyes on a particular
location. However, these very advantages can also be drawbacks,
and I think that some retailers (and IBN) have acknowledged that audio
isn't always the best medium to get a brand message across. Nor
can it really be used for the most precise ad targeting, where the
presentation medium is placed immediately beside the product being
advertised, such as on an endcap display. (Yes, I suppose you could use
HSS or sound domes
for this, but that would probably over-limit the medium's reach, and
likewise, its usefulness.) With the ability to deliver highly
targeted visual messaging, digital signs would appear to be a logical
complement to even the most successful in-store audio programs.
The Kroger announcement shows that IBN and its customers are ready to
test this theory on a large scale.
Given their impressive foray into the digital signage marketplace, IBN will likely establish themselves alongside PRN
as one of the largest digital signage network operators in the US, with
their rise occurring virtually overnight (well OK, they acknowledge
that it will take about 18 months to roll out the network). And
it stands to reason that they'll continue to upgrade other clients'
networks to video as it makes sense to do so. Other in-store
media companies should pay very close attention to their performance in
the coming months. A successful Kroger rollout could signal the
beginning of a mass adoption of digital signage strategies by other
traditional POP and retail fixtures companies. As digital
retailing technologies become more prevalent, many retailers will look
to their existing vendors to implement these systems, and the vendors,
in turn, will look to existing industry players for help getting
started.
Obviously, I'd like to see digital retailing technologies (e.g. interactive kiosks
and digital signs) simplified and commoditized to the point where any
number of mainstream vendors can offer them to their retail
customers. I'll be very happy with the progress of our industry
when these tools are treated more like marketing and advertising tools
and less like a hot new technology. Seeing
incumbent in-store marketing companies branching out into digital
signage is a definite sign that this sort of change might be closer
than we think.