Amidst major changes in media consumption, GO!Network's CEO suggests digital means of reaching people outside the home.

Attention is one of the most sought after commodities for marketers today. The ability to capture a consumer's nearly undivided attention, at that "moment of truth," when intentions can be converted into either preference or purchase, is invaluable.

Consumers, however, don't spend their entire lives online or in front of a television. Consumers go to a host of events and venues outside the home. For example, over 200 million consumers visit shopping malls in the U.S. each month. Taken together, marketers need to be concerned with how to gain the attention of consumers away from home.

The answer: digital signage. Digital signage is a place-based messaging medium that communicates with consumers using digital content delivered typically over high speed networks to TV-type devices in public venues. Digital signs can deliver dynamic, timely messages at the point of decision, influencing consumer behavior away from home.

A Growth Industry

Digital signage is one of the fastest growing marketing opportunities in the world today. As an industry (according to Cap Ventures) it is forecast to grow at a rate of nearly 50 percent, per year, for the next five years with projected revenues of $2 billion by 2009.

There are a number of key drivers behind this projected growth.

First, mass media's power to influence consumer purchase decisions has declined over recent years. The glut of hundreds of TV channels, spam, pop-up banners, bulk direct mail and telemarketing has led to consumer indifference. In response, marketers are increasing spending in alternative marketing channels such as search-based advertising that have the ability to deliver more timely and targeted messages. 

Second, the ability of digital signs to deliver promotional messages at the "moment of truth" in retail-type environments has created a valuable sales opportunity for product marketers. Finally, lower costs for display devices and communication technology have made investments in digital signage projects more reasonable.

In short, as attention becomes scarcer it becomes more costly to acquire and as marketers identify channels where the competition for attention is lower, demand for access will drive growth.

Existing Barrier to Growth

Today, there have been only a few digital signage deployments of note. The success of Premier Retail Networks (PRN) who provides the in-store TV network for Wal-mart, Albertson's, and other retail chains is a prime example. Considering the attention that PRN's success has garnered, marketers are pondering the barriers preventing digital signage from achieving explosive growth sooner rather than later.

For starters, no one can agree on an approach that advertisers can build an industry around; PRN and similar network providers price their offerings on the traditional cost-per-thousand (CPM) approach while other digital signage network operators employ a traffic-based number of impressions model. Where both approaches fall short is in their inability to accurately measure the effectiveness of a digital signage campaign.

As a result, the digital signage industry, while primed for rapid expansion, has yet to grow at the same rate as online marketing channels primarily due to a lack of measurability. The focus of this article will be on how adding interactivity may help digital signage expedite its growth.

Benefits of Interactivity

Interactive signage solutions such as touch-screen kiosks can play a huge role in shaping the future of the digital signage industry because they enable the direct measurement of consumer response. Not only can interactive signage provide marketers and venue owners with detailed information on the number of people that view specific content, it can identify who's been engaged by it. This information is the foundation on which follow-on advertising revenue can be sold; it can clearly articulate each advertiser's return on investment ("ROI").

With advertiser ROI and real measurements in hand, solid pricing strategies and models can be developed. This will open the door for digital signage providers to develop industry standards and implement performance-based business models similar to those that are now prevalent online.

Interactive signage solutions can be crafted to personalize the experience for each consumer. The marketing content delivered to each consumer can be based upon either specific information that they provide or purchase selections that they make, leading to larger transaction amounts.

Interactive signage will determine the consumer preferences that will be used by marketers to establish deeper relationships with their consumers; the technology enables consumers to opt-in to receive information related only to the products and services in which they're interested.

A properly executed digital signage strategy that interactively delivers dynamic content can benefit all parties involved. Consumers are able to take advantage of valuable offers from companies with whom he or she actively chooses to do business with. Marketers can add valuable consumer information to their databases for ongoing marketing initiatives, increase transaction sizes, and quantify their ROI. Site owners can generate additional revenues from their visitors while they enhance the site's visitor experience. And, most importantly, network operators are provided with a solid revenue base from which to grow and sustain their enterprise.

Moving Forward

It sounds simpler than it is. There are substantial costs associated with device acquisition and installation, content delivery and management, and communications infrastructure along with the sales and support resources involved in implementing any digital signage deployment. Additionally, devising a standard pricing model for an interactive solution may prove difficult as customer acquisition and advertising costs vary widely. Finally, the right software is needed to take advantage of all the potential opportunities presented through interactive digital signage.

As a participant in this industry, I can attest to the difficulties of deploying and managing an interactive digital signage network. However, network providers can establish viable business models by incorporating interactivity, setting the stage for mass adoption from product marketers. The key driver behind adoption will be the ability to provide reliable metrics. The future of the industry will depend on it.