The technology is fit-for-purpose, the metrics are in development and the level of interest is once again high. So is the future bright for out-of-home digital media networks?

Whilst still arguably in its infancy, the digital signage industry has been evolving at a rapid pace over the past few years. It is now almost impossible to keep up with the plethora of new digital signage conferences, exhibitions, press releases and research. So what is the real story? Historically, what have been the barriers and drivers and has the industry now crossed the chasm from innovator to early adopter?

In discussing digital signage and media networks with the organisations adopting them, Futuresource Consulting recently undertook research and discovered a wide range of reasons as to why they decided to use this technology, the nature and level of involvement of internal staff and external suppliers, the objectives they set (and frequently the lack of ways of measuring success), the nature and mix of the content and the extent to which initial plans were modified during operation to improve results. Listed below are some of the key barriers to the development of the industry which will ring true (and probably be of little surprise), to many in the industry.

A lack of clear ROI modelling
Often large upfront costs to implement and maintain a network make such a signage network very risky and sound ROI models critically important. There is a need to prove that screen networks lead to sales uplift, and simply measuring footfall and dwell time is not enough. Proof is needed that screen networks deliver measurable and lasting uplift.

The lack of advertising proof points
Whilst a number of companies are using technology to provide screen 'footfall' and 'dwell time' metrics, this has not provided a raft of proof points. Compared to TV, radio, posters and the internet, screen media networks still have a way to go in proving their value. 

Too much network fragmentation and not enough scalability
With so many independent networks in operation it is very difficult to tempt advertising and media agencies to spend on digital signage. 'Opportunity to see' statistics are not at all persuasive and it is almost impossible to run a coherent campaign in multiple locations.

Project complexity
In some cases up to eight individual parties can be required to complete a project. This is simply too complex.

Little understanding of content requirements
Issues such as the expense of refreshing content, the mix of content and what the content -- particularly advertising -- is supposed to achieve are frequently overlooked. However, this is the most important aspect of a network to get right. Clearly two of these points are very much focused on the advertising-based model. Though other models are equally valid, and quite often the most interesting, it is the advertising model that will really drive the development of digital signage.

So where are we one year on?
For the most part, ROI modelling is still an area for contention. Strides have certainly been taken to develop these models with some notable success in shopper tracking, visibility, recall, but an industry standard has yet to be agreed.

Advertising and media agencies have begun to take notice of digital signage, as the effectiveness of traditional communication forms become ever more diluted. Big brands have woken up to the possibilities that signage can offer and often put pressure on their agencies to at least experiment with this medium. Efforts have been made to provide greater ease of use and flexibility in the content storage and distribution software. More display manufacturers are making software available, with varying degrees of sophistication, for use with their screens. The industry is now beginning to see more 'plug and play' solutions, which in turn have minimised the need for so many individual players in a project.

The industry now has a clearer understanding of how content should look and what it aims to achieve. Gone are the days of reusing a TV commercial in its entirety, where only 10 per cent (at best) has any kind of call to action. Furthermore, dedicated signage channels are currently in development to help smaller budget constrained networks overcome the problems of keeping content fresh and interesting. However, with an ever growing reliance on content feeds from broadcasters to 'fill in the gaps' it is a worry that the impact and effectiveness of signage may get lost in a homogenous mess of unoriginal content.

New global companies have entered the market, coming at digital signage from the networking angle in particular, and leveraging existing relationships with senior IT managers. However, their foray into this market appears not to be backed by significant corporate funding but rather these embryonic activities have to develop into fully fledged businesses under their own steam.

A checklist for success
Despite this myriad of essentially individual projects covering supermarkets, high street multiples, petrol stations, gyms, restaurant chains and many other locations across four countries, Futuresource was able to identify a number of common factors that tend to increase the chances of achieving a successful project or the absence of which will tip the balance the other way:

1. Engage top management but ensure key checks and balances are in place and key stakeholders are on board.
2. Encourage finance department involvement. They provide a solid basis of checks and balances.
3. Embrace the complex approval process. This maximises likelihood that the right questions and issues are addressed.
4. Set objectives. Even if they are initially 'best guesses'.
5. Set non-financial as well as financial objectives. Qualitative improvements may not always result in 'immediate' financials. 
6. Budget for the cost of measurement. Build in processes and cost of measurement, e.g., 80 per cent of customers more likely to come back, increased frequency  of  visits. It also focuses attention on the objectives throughout the project.
7. Build in content experimentation. Build in capacity for timing/measurement/staff resources.
8. Understand the full roll out cost implications. Trials with no possibility of full roll-out are unrealistic. Use the trial to test the full roll-out business case.
9. Commit resources to adding and developing internal understanding. The technology is not the key. Using it to influence customers and employees is.
10. Recognise that advertising rates are related to value for the advertiser. Benchmark against other media.
11. Plan in detail and then plan again.

Final thoughts
The industry has undoubtedly made strides to overcome many of the barriers holding back the adoption of digital signage. Stable and flexible software platforms have been developed, traditional display vendors and global IT giants have entered the market and the distribution/reseller community are beginning to focus on this area. However, further development of measurement and proof point matrices are still clearly required to ensure this medium is viewed as a viable alternative to the traditional communication mix. Above all else the industry must be able to appreciate that whilst digital signage offers fantastic growth opportunities, hurdles still need to be overcome and a more temperate approach to market potential would be beneficial to all.

Chris McIntyre-Brown is a consultant, Futuresource Consulting.