Digital Signage Origins
Digital Signage is a trend that is appearing everywhere. It's common to see a variety of commercial digital signage applications in public areas. In the 1970s, store owners used VCRs and televisions to attract customers but they were always on a closed circuit and everything was pre-recorded. These applications can be regarded as the forerunners of modern digital signage.
It wasn't until recent years that companies have been able to display high-quality content that is supported by a broadband Internet connection. This kind of advertisement is spreading to different venues: malls, restaurants, airports, and post offices.
It is a relatively new and popular approach to advertising that allows companies to use electronic screens to broadcast information, commercials, or anything else of their choosing to large numbers of people. Digital signage advertising could revolutionize the consumer market in the span of a few years. We have all seen the huge screens in places like Times Square and Las Vegas, but now they are everywhere, directing and enticing you to visit new places, or try new products or services.
Apart from being used to display advertisements — replacing traditional paper, email or formal announcements — digital signage has become a new medium in message delivery and information updates. Another trend first popularized by the Internet is the use of colorful and dynamic media delivery. Today's audiences are increasingly attracted to dynamic content. According to a recent report, it has been shown that customers will remain in a store for a period of time 5% longer and that they will retain information 37% longer, when shown advertisements with rich and dynamic content.
Digital signage is proven as a method leading to increased sales, and doubles the probability of customer impulse purchases. As a result, we believe that digital signage will gradually replace traditional posters in retail outlets. Already in many industries including services, retail, healthcare, and hospitality, still images and posters have been replaced by multimedia panels capable of displaying rich content.
Today, the attitudes and actions of both people and companies have changed sharply in favor of the use of digital signage as they realize the potential it brings. And with the decrease in prices of LCD and Plasma screens these days, digital signage is a more affordable and attractive investment for businesses. On the technology front, digital signage has come of age, moving from the experimental and into the mass production phase. Major players such as Intel and Microsoft are trying to chase the market because of the potential it has to offer.
The Growth of Digital Signage in Today's Market
According to the report "Global Digital Out-of-Home Media Forecast 2008-2012" by PQ Media, despite the slowdown in 2009, PQ Media forecasts a compound average growth rate of worldwide spending for the digital out-of-home (OOH) market of 14.5% for the 2007 to 2012 period. OOH or outdoor advertising will fare well despite the downward trend in the rest of the advertising industry, achieving high percentages in advertisement dollars which were allocated to traditional media in the past.
Two major factors supporting the growth of digital signage are the huge price decrease of LCD and plasma screens, and advances in high-speed Internet connectivity. High-speed broadband Internet optimizes digital signage performance, as well as providing digital signage players with live update capabilities.
A large digital signage network has sprung up on and around the Internet. It has helped retailers, marketing and entertainment companies, and many other organizations to 'narrowcast' dynamic video, and graphical and editorial content, to hundreds, or even thousands, of digital signage displays located virtually anywhere.
Due to the recent economic crisis and panel oversupply issues, LCD and plasma screens have dramatically decreased in price. Compared to investment capital requirements five years ago, digital signage is considerably more affordable now. In financial terms, the ROI is a lot more attractive for investors. In the face of huge market demand, one worry to people in the industry is that lack of open standards throughout the market will impede the acceleration of digital signage growth unless swiftly dealt with.