The Digital Signage Business Continuum

White Paper: Page (2) of 2 - 11/29/05

The Digital Signage Business Continuum More than broadcasting or publishing on steroids

Participation by a wide range of firms

All of the organizations currently involved in the Marketing Communications supply chain today are positioned to participate in the Digital Signage supply chain.

All firms with existing or potential relationships with Branding organizations or location providers are positioned to present and exploit the digital signage opportunity.
Display locations are provided at retail, service and public locations.
Content is made available by creative and production houses such as Ad Agencies and Digital Graphics providers.
Publishers, broadcasters and out-of-home display providers can sell and manage display inventory.
Investors and organizations can enjoy high ROI through signage network deployment and operations.
Technology providers can supply hardware, software and other required elements.

Each of these can and are becoming new digital signage players and partners. The significant business opportunity exists when:

There are ?MANY ADVERTISERS IN ONE LOCATION ? and/or ONE ADVERTISER IN MANY LOCATIONS?

?Media Planning and Buying? is about eyeballs at LOCATIONS. Multiple brands seek to get their message into multiple locations. So, digital signage network planning will consider this broader, expanding universe of display potential.

Knowledge (or accurate projections) of display intent, location opportunities, revenue potential and Digital Signage network costs allow the network owner to create the business plan. Some key inputs are number of locations, displays per location, rotation wheel and rate card. (See planning articles in the Resources section of www.btvplus.com)

More than ?e-pub/loc-d?

Dynamic Digital Signage has substantial merit as a display medium, because it;

Reduces messaging cost.
Increases messaging flexibility.
Gets noticed, motivating action and recall.
Improves the shopping or waiting experience.
Reaches audiences out-of-home and at point-of-purchase.
Accelerates ?speed to messaging?.
Allows message day-parting, change frequency and micro-marketing.
Enables both branding and merchandising message display.

Digital signage could be considered as ?electronic publishing to location displays (?e-pub/loc-d? in techno-speak), somewhat as broadcasting or publishing on steroids - a technology integration exercise.

Paradigm Shift - ?Blue Ocean Strategy?

An October 2004, Harvard Business Review article described a ?Blue Ocean Strategy? as an approach that substantially improved competitive advantage through the use of new approaches. This applies to digital signage, which offers an integration and leverage of business communications approaches.

Marketing campaigns usually include consumer education, a Public/Media relations campaign and sponsorship. These are not publishing processes but so much as they are real-time consumer presence.

The infrastructure of a digital signage network can rotate hundreds of static, animated, or video messages while also scrolling or rolling text or visuals.

The highest value comes when that some infrastructure is used for display to different audiences of different content.

Each display can be designated to a particular purpose during the day. Or, by placing the displays on a metaphorical swivel, it could be staff-facing in morning for orientation or training, customer-facing for merchandising during business hours and management-facing in evening for sunset situation reviews/wrap-ups (sit-rep/sit-wrap). Staff or patron communication could include live, private-to-location broadcasts of events and presentations which advance revenue and branding achievement.

These marketing approaches can leverage the digital signage network, providing greater service options, improving the customer experience and align enterprise messages, while providing excellent non-display revenues for the signage network provider.

To be of full, best and future service, the Signage Network must support live (not just pre-recorded), standard definition, full-screen display. The world of acceptable postage stamp-sized, cell phone display is not nearby.

Below the line, Digital Signage is a system integration exercise, where hardware, software and connectivity will define network:

Capabilities
Revenue Potential (and therefore network valuation)
Capital requirements, and
Operational costs

Numerous options for each of these elements are available. Primary considerations must be 1. Functionality, 2. reliability and 3. scalability.

In a typical digital signage system a Bill of Materials includes 40 hardware and 6 software elements, 500 locations can be installed in 60 days and ?all-in? costs under $500/location/month with each display adding another $100/month could be expected.

See www.btvplus.com ? Resources for additional information about typical pricing.

The last part of the continuum is CONTENT and NETWORK OPERATIONS, and the supply/demand balance of the flow of content that requires display, and the supply of display ?inventory?:

Ads will be placed elsewhere if display inventory is not available.
The ROI on display inventory will be lower if content for display is low.

A business model based on ?pay-for-performance? would be a breakthrough in Digital Signage deployments, and some network operators are considering this approach. Perhaps it is Digital Signage that will ?step up? to the pay-for ?performance approach that brand managers and their executive management have longed for.

In Summary

Digital Signage offers a paradigm shift in business communications aimed at brand building and revenue achievement. The opportunity is for enterprises to side-step many costs while dramatically improving communications results. The ideal digital signage partner is not only a proven integrator of proven technologies, but a provider of services and expertise that leverage the digital signage infrastructure to meet broader communications needs more effectively. BTV+ welcomes such

About BTV+

BTV+ was founded in 1981 and is a pioneer of interactive image display for distance learning, multi-location digital presentation and digital signage. BTV+ uses secure, internet protocol (IP) satellite communications currently serving thousands of locations in USA, Canada and Mexico. Over 20,000 hours per year of live content is produced for BTV+ clients in retail, grocery, banking, apparel, post office, gaming, automotive and other locations. BTV+ operates studios in the US and Canada. The firm?s core offering includes satellite bandwidth for business applications and its capabilities include large-scale, North America-wide project management, installation and operations.

See www.btvplus.com

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Lyle Bunn is BTV+ Director, Digital Signage and Rich Media. Lyle can be reached via email by clicking here.

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