Going Digital

By  Stuart Armstrong — July 27, 2006

The next time you find yourself in an airport, at the grocery store, shoe shopping or at the local pharmacy, take a close look around. Chances are youll find some form of digital signage or digital media close at hand. Whether it serves to attract consumer attention, provide entertainment, offer information or influence buying decisions, digital media has become a pervasive medium in our day-to-day lives. It is helping to inform customers while shortening times in places like pharmacies and train stations.

It is speaking directly at the shelf edge to consumers at the point of decision and sometimes even at the point of consumption, in the case of food and beverage venues. This emerging technology is even being used to help inform, communicate and train retail staff on the latest products, upcoming promotions or even how to polish their selling strategies.

From Sofa to Shelf

Its probably worth taking a step or two backwards and exploring the various trends driving the growth in digital media. One factor is a marked shift in communications, a movement from the sofa to the shelf.

Viewing the TV from the sofa is what is traditionally known as above-the-line advertising. It involves delivering indiscriminate messages to a mass audience, without any clear sense of who might be watching. It creates awareness among consumers, but many of the members of those audiences are shrinking and becoming fragmented, as consumers turn to different communications channels for news, information and entertainment.

Fifteen years ago most brand messaging and advertising was delivered into the home. But, five to 10 years from now, the home will likely be the only place we can escape advertising. At home we now can filter out communications, using tools such as TiVo. The control has shifted from the marketer to the consumer/viewer. As a result, billions of advertising dollars now are being allocated to more targeted mediums, and this is happening at an accelerated rate. Some of the dollars are being reallocated to the store where retailers have the power to deliver messages to consumers the entire time they are in the store, from entrance to checkout.

At shelf edge, retailers can target individual consumers needs and mindset at the moment of truth when she/he is deciding to make a purchase.

A second factor behind the growing move to digital media is its natural powers of communication. For instance, retailers can use digital media networks in-store to alert staff and customers about company community activities and charity participation, such as little league sponsorships or donations to hurricane relief, thus connecting the store more closely to the community that it serves.

Digital media also can offer a powerful means for product promotion. For example, if a shopper in a Sears store is buying golf apparel Sears can take advantage of the opportunity to let that consumer know brand-name golf equipment is available in another part of the store. Digital media can inform consumers about products and affect shopping patterns in real-time while they are still in the store.

Promoting products in a timely fashion

is a key advantage of digital media. Digital programs can be designed to deliver targeted information directly to the individual store, to a specific screen within the store and even by time of day. Digital media can help promote seasonal products in a timely manner, which is a vital issue in the fashion industry. Timely promotions also have applications in other industries. Grocers who find themselves faced with an oversupply of perishable fruit can use digital media to drive sales before the products spoil.

Digital Design

Once a retailer has made the decision to forge ahead with digital media, the next issue is how best to design the set-up within the retail environment. Each retailer needs to consider the size of the screens and the general choreography within the store, and be sure the choices fit the overall retail environment. Store management knows how to identify the key zones in the store and how those zones play to consumers. Its vital to understand and map those zones and readily understand shopper motivation.

Different consumers have different goals when shopping in different retail environments. For example, the time-pressured consumer shopping in a grocery store has a different motivation than someone in a more leisurely mode in an electronics store, browsing for a digital camera. Both of those shoppers have different motivations than a woman shopping for fashionable footwear. All of these consumers are entering the retail environment with a different mindset, attitude and needs. Be sure the media that delivers your desired messages supports those needs.

Digital setups can vary, from using one screen to many. One retailer, for example, elected to place a large screen in the front of the store, utilizing localized or targeted audio in a specific area so it doesnt drift into other departments and distract staff and other shoppers. That same retailer also placed large plasma screens around the perimeter of the store, orchestrated in such a way that all the screens are in clear sight lines and run in concert with each other. This retail setup also featured free-standing displays and smaller interactive screens for consumers to gather product information. Shelf edge units helped reinforce the purchase. The digital media was complementary with the store design and other print signage, and helped enhance the overall consumer experience during their shopping journey.

Driving the Content

One very real concern many retailers have is ending up with a bunch a blank screens or a loop that runs over and over every four minutes and drives everybody nuts. To avoid the pitfall of annoying shoppers, retailers should strive to offer relevant content that is creative and eye-catching in a length that is not overly repetitious. At the same time, content design and creation has to be affordable at sustained levels. One piece of the equation is the use of smart content templates, which can repurpose content from print signage and video adverts. Another piece is the use of RSS (Real-Time Simple Syndication) feeds that can bring in all sorts of up-to-the-minute information such as news, sports, weather, health information or entertainment news.

Reliability is Key

While having the correct content is vital, the message wont be successful if the technology fails. If you are constantly swapping out broken units or re-booting computers, it will drive up your total cost of ownership (TCO). While some vehicles are less expensive up front, they will cause headaches down the line, such as VCRs, DVDs and PCs. Sure DVDs are cheap, but they also have a 40 percent failure rate in the field.

The technology also must be compatible with your technology infrastructure, offer high levels of security, and provide scalability. For example, in a system that is running 5,000 screens, you could get 150,000 connects a day and 80 transactions per second on digital signage. For that kind of use, you have to have some pretty significant levels of scalability.

To maintain the highest level of content security, the in-store technology should be pulling content from a centralized server versus the server pushing content down to the store. This media transfer approach ensures that others cant push unauthorized content to your screens. Additionally, every time the screens communicate to the server they should be passing its diagnostic information and proof of play information back up to the server as it is looking to transfer any new media that is designated for that screen. There is no intervention at store level.

Store-level personnel also should not have to be concerned with monitoring the system. Service providers can do so from a central location, then alert store personnel if a screen is having problems. For example, for the networks we service, we strive for a rate of 98+ percent uptime and 100 percent media compliance. If we do have an issue with a screen, very often the problem may be that it has simply become unplugged.

In the rare case that a unit does fail or is broken, there should be a spare pool and the service provider should easily and quickly swap out the units.

Eye on ROI

When you begin to look at the cost viability of digital media, consider that for a 200-300 store implementation over a two-year period, the total cost of ownership could be anywhere from $50 to $3,000 per week. (That cost estimate is all-inclusive, including hardware, installation and content development.) Digital media for a 14,000-sq.-ft. store with a respectable amount of screens should come in at approximately $350 to $400 per week per store, as an all-inclusive price. Retailers can begin to do some ROI around the potential cost and also look at some of the financial benefits around increased sales, smarter staff and more efficient inventory management. Additionally, there is the role of supplier-sponsored media and potential advertising that could air over these digital media networks to help offset some of that capital expense.

Once the decision is made to pursue digital technology, retailers need to take a methodical four-step approach to implementation. First, identify your business and communication objectives and make sure the channel, strategy and content align with those objectives. Second, keep the needs of both your consumers and staff primary. Third, develop a measurable phase one implementation of the technology, including proof of concept, looking at the potential of delivering against the key performance indicators that you have established. And, fourth, engage early on with a digital media network company that has a proven track record and can offer a turnkey solution.

Stuart Armstrong is chief operating officer of Digital View, which provides design and implementation of out-of-home advertising, digital signage and screen media networks.

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