♪♫ Nobody knows... the trouble I've seen... ♫♪
I'm not so far gone as to immediately think of those off-the-wall ideas as surefire hits. After all, the digital signage game -- fundamentally at least -- isn't different than any other line of business. Thus, we should expect all of the standard business rules to apply. So, for example, we can expect that less than half of new businesses will last five years. (30 years of US Census data tells us that story with pretty good accuracy.) Of the remaining half, a good number will be liquidated (which doesn't technically count as failure according to the government), and still others will shift directions entirely without closing down the business. (For example, changing from a digital signage company to a bed and breakfast.... Don't laugh. You know it has happened.)
Image credit: Joe Abbruscato
Different doesn't always mean better, but sometimes, better must be different
An anonymous commenter left an incredible comment describing the rise and fall of Reactrix on a recent blog article about how to sell your digital signage company. Reactrix had a very different model, different technology, different... well, pretty much everything. In addition to building out their own technology platform, developing their own physical infrastructure for each venue and designing brand-new, totally custom content for each advertiser wanting to try the system, they also had to convince prospects of the feasibility and desirability of all that new stuff.
Many less ambitious DOOH companies have run into trouble, too. In fact, "I'll put your ad on this screen if you pay me X" is such a tough sell for so many that we've seen and heard about hundreds of variant models that try to make it easier to pry the money out of prospective advertisers' tight grips. Some have involved co-marketing funds. Others relied on government programs to make the purchase a tax write-off (or close to it). And still others used barter arrangements, in-kind transactions and other non-cash incentives to make screen time buys seem as manageable as possible to potential buyers.
There are a couple of problems with these techniques, though. First, there's no guarantee they're going to work. The difficulty of explaining your compensation model might be enough to drive prospective buyers away before they have a chance to make an informed decision. Or, your model might be so far outside of what the client is used to doing from a business and accounting point of view that they'd just as soon not be bothered. This is especially true for networks that plan on securing national or regional advertising through media planning agencies. And second, unless you're already very familiar with the ins and outs of your model, there's a very good chance that your too-good-to-be-true, guaranteed sales generating business approach will promise too much, ultimately not leaving you enough to actually run your business on.
Using the unusual to your advantage
In order to close digital signage deals, it's important to be creative -- and essential to be flexible. A while back, I might have discouraged new networks from starting out with nonstandard business terms. But these days, I honestly believe that the oddball deals are doing more good than harm, gaining wins and concessions that probably would not have happened under traditional terms. One thing that worries me, though, is that I still haven't seen a surefire execution strategy. We've seen multiple incarnations of even the strangest business models, and just like anything else, sometimes they succeed and sometimes they fail. I suppose that can be chalked up to all the usual business execution challenges and market forces. But it'd sure be nice to know that there was some plan -- when properly executed -- that produced consistent results.
Have you heard about any bizarre sales strategies? Can these unusual approaches succeed in the long run? Leave a comment below and let us know what you think.