Lessons Offered By New York Subway Digital Signage Network
I was in New York not long ago and I remember seeing how brilliant and eye-catching these things are. It’s not Times Square, where you’ll find yourself completely surrounded by flashing lights and in-your-face marketing messages, but rather a subtle and catchy way to promote in a high-traffic area, the subway entrances. This article not only talks about those signs in particular, but about digital signage in general and the way it is growing into an important tactic for practically every industry.
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By Lyle Bunn
Digital Signage is being called “the last mile of a marketing program”, offering more cost-effectiveness, flexibility and control at product and service selection locations. Many retailers such as Apple, McDonald’s, Bank of America, Circuit City, Safeway, Sears, Virgin Music, US Postal Service, Nike and others ran successful pilots during 2004.
At the same time, some of the firms shifting ad spending to digital signage include astute media buyers and brand-builders such as Bayer, Black & Decker, Colgate-Palmolive, Disney, DirectTV, Frito-Lay, General Mills, Heinz, Kodak, L’Oreal, Minute Maid, Nestle, Sara Lee, Starter, The New York Times, LG Mobile Phones, ABC, Fox, Univision and Lee Jeans.
Here are a few of those valuable lessons:
Lesson One
from New York is “Build it and they will come”. The pressure to get more results from advertising continues to grow and digital signage display is becoming a part of $149 billion annually invested in advertising. At one end of the scale, CPM (cost per thousand) rates of $2-6 make digital signage an inexpensive media buy. There is a question of how long this bargain will last as performance is increasingly proven and more advertisers take advantage of this powerful new communications medium. Revenue increases of 30% are being realized on products profiled, ranging to 109% for a new soft drink and 319% for a new calling card. Digital signage in bank teller lines results in customer inquiries about new services.
Lesson Two
is that “Wireless networking is effective for digital signage”. This is important for signage location flexibility and deployments in harsh, highly obstructed environments. “Wireless networking has performed well and the system has had no image drops whatsoever” said Rex Williams, President of UDN, which installed the New York network. WiFi 802.11 using multi-polarity antennas from WiFi-Plus Inc. (www.wifi-plus.com) has provided reliable, secure and cost-effective connectivity for the 80 New York street level LED panels. Williams added “Wireless works for digital signage. While it was the only option for installing the New York system, it has proven totally reliable with zero content drop performance”.
“Cost-effective, reliable, fully secure and interactive image transport done wirelessly by satellite has long been used for Interactive Distance Learning (IDL) and business television applications” said Larry Steinman, President and CEO of BTV+ , which is contracted by some of North America’s largest organizations to deliver interactive content to more than 13,000 locations in the USA, Canada and Mexico (www.btvplus.com). Steinman adds, “digital signage applications benefit from the cost-effectiveness, location flexibility, security and reliability that satellite connections provide for digital (IP) communications. Overlaying full motion signage on an existing IDL or BTV (business television) infrastructure is easy. Content management, network monitoring, troubleshooting and reporting tools are well advanced.”
Lesson Three
is offered by Williams to others, in particular municipalities, looking to install digital signage networks; “It is imperative that great care be taken by anyone looking to get into this business to ensure that the integrity of the content is impenetrable by outside forces”. System security may be inadequate at the network design stage, or be exposed as digital signage systems expand and use multiple media transport providers (ISP – Internet service providers). Williams added, “The system must be nearly “bullet proof” as far as hackers go. Signage software providers such as Automated Digital Signage Networks (www.adsn.ca) have taken steps to assure security at the content ingest, play-list management, display monitoring and other vulnerable points.
Lesson four
is reflected by various digital signage projects during 2004; “Digital Signage offers high return on real estate”.
Digital displays support commerce, public safety and information needs because they are so visual, vivid and eye-catching. Being able to provide information at a point of decision or when information is needed underpins the value of this communications medium for advertisers and public service providers.
Revenue measures from stock turns, margin per square foot or revenues from print (static) signage locations place a value on retail location space. Revenue from dynamic digital display at, for example $10,000 per month per display to the network owner, offers a good “return on space” comparison. The location benefits of use, such as product lift, branding, better customer relationships, liability containment, etc. are adding to the value assessment. The 25×50 inch LED signs positioned at the street level entrance to New York subways are providing a “return on space” and value along the supply chain from advertiser to signage provider.
To summarize, the lessons are:
1. Build it and they will come.
2. Wireless networking is effective for digital signage.
3. Integrity of the content being impenetrable by outside forces is critical.
4. Digital Signage offers high “return on space”.
Happy birthday New York subway signage network! You show the potential of an entire industry.
Super-size me: Digital Signage for restaurants
When I was first in the University of Louisville’s graphic design / communication arts program, we walked through a typical morning (taking a shower, eating breakfast, driving to work or school, etc) and noticed that the applications of graphic design, packagaing design, and logo/identity design surround us so much that we don’t even notice them. Digital Signage is becoming as ubiquitous. It’s almost expected that any large company will feature some sort of dynamic display to show marketing messages, or flat-panel monitors to replace traditional wayfinding systems. Now the restaurant business is getting involved. Check out this article from QSR
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Ads With That?
Bringing outside advertising to your customers can bring revenue to your restaurant.
With the advent of TiVo and other digital television recording devices, television viewers have the power to record their favorite programs, watch them at their leisure, and, of course, fast forward past pesky commercials.
These technologies deprive advertisers of a once-captive audience. But where technological advancement closes one door it opens another.
Developments in data broadcast technology and high-definition televisions have primed the digital signage market for an explosion, allowing advertisers to reach a captive audience when they’re out to eat, as op-posed to when they are lounging on the couch.
OOH (Out Of Home) Vision Networks (ovn), an advertising and marketing firm, has partnered with Helius, Inc., a business-class data broadcasting company, to pump video advertisements into more than 100 retro diners in the Connecticut, New York, and New Jersey areas.
OVN CEO and President Craig Presser doesn’t mince words about the possibilities of this new advertising strategy. “It’s an exploding market, not even an emerging market,” he says. “Whether you’re in casual or quick-service, you’re going to see place-based media on screens.”
The chrome diners, which seat about 200 and are located in affluent areas, have been outfitted with five liquid crystal display televisions strategically located in order to grab the attention of as many patrons as possible. Four of the screens measure an impressive 42 inches, while the fifth measures 23 inches.
Each screen is divided into three sections: Two-thirds of the screen broadcasts constant video advertisements, typically for local and regional businesses, and share space with the left third of the screen, which is reserved for whatever the diner wants to broadcast. Diner managers can advertise specials or welcome the mayor with three or four shuffling still images, says Mike Tippets, executive vice president for Helius.
At the bottom of the screen, OVN provides a live news ticker, complete with news, sports, weather, stock quotes, and traffic information tailored to the zip code.
Impact studies, Presser says, revealed that the advertisements were better received without volume, so all OVN advertisements are silent. “We want [the advertisements] to be obtrusive but not at a volume that prohibits conversation,” he says.
Developments in data broadcast technology and high-definition televisions have primed the digital signage market for an explosion.
On the larger portion of the screen, OVN’s digital signage network broadcasts a seven-minute advertising loop. This setup is specifically designed to get the most advertisement impressions from each customer. “In the diner environment, OVN figured the typical patron stays in the diner for 42 minutes, and we want them to see the advertisements six times,” Tippets says.
Although Presser declined to share the exact number of locations in the OVN Diner network, he says his advertising setup reaches more than 1 million people per month, with 5.8 billion annual advertisement impressions.
This digital signage revolution of sorts should quickly reach the quick-service market. One doesn’t have to look past OVN to find a company looking to work with quick-service chains and franchisees to reach potential customers.
“I absolutely think this can work in a quick-service market,” Tippets says. “In McDonald’s, Arby’s, Wendy’s, Quiznos, or Subway the same things happen. I walk in and stare at the menuboard, and you’ve got a chance to influence me with upsell opportunities. You can introduce me to a new menu item I might not have seen, and the franchise owner also has a chance to share in revenue,” Tippets says.
Presser reports that his company was recently awarded a sizeable contract with a quick-service company and has similar plans with other traditional dining restaurants.
Although some diners might recoil at the thought of advertisements in their face while they eat, Tippets says that advertisements and a news ticker can be a welcome distraction while waiting for a meal. “If I am waiting for my food, I might want to be distracted,” he says. “Perceived wait time is less if I am distracted. That 7 to 10 minutes goes by a lot faster,” he says.
While diner managers expressed some reservations about putting televisions in their establishments at the onset, Presser says positive patron response and a promise of a cut from the advertising revenue helped usher in the big screens.
Each diner gets the television installed for little to no cost, shares some of the ad revenue, and OVN takes care of advertising sales. So far, Presser says, he has a wonderful renewal rate with advertisers.
The technology behind the advertising network is facilitated by another partner, Microspace Communications Corporation, which uses it’s VELOCITY satellite service to beam content to each diner location. Helius’ MediaWrite content distribution management system figures out which advertisements go where, and Microspace beams it there via satellite, where a Helius router unpacks the information and sends it to the LCD televisions, according to a Helius press release.
“The affinity of Microspace’s satellite delivery with Helius’ turnkey hardware/software solution offered a cost efficient and streamlined solution for a network of this size,” OVN’s Vice President of Operations Robert Goldner says in the release. “In addition, satellite is point-to-multipoint, which translates into a faster network that is suited to Out of Home Alternative Media.”
While OVN is just two years old, Helius has been around for a decade and saw digital signage as the logical next step for the company. The company has been in the business of moving data and IP video, had success in corporate training via IP, and saw a clear similarity between broadcasting training content and broadcasting digital advertisements, Tippets says.
After hooking up with OVN, Tippets says his company developed a new generation of the Helius software and hardware. “Instead of just distributing ad spots, now we have a whole workflow scheduling engine at the top end. OVN can check whether an ad can run at a certain time, when the ad stops, and so on,” Tippets says. Now, OVN can create an automated playlist for advertisements that can be customized for each diner. The system will also alert managers if a new advertisement has not been put into a playlist, and it can automatically remove advertisements from the loop after a certain period of time.
With the development of these technologies, the digital signage arena is set to expand dramatically. InfoComm International (infocomm.org), the audiovisual and information communications industries international trade association, reports that digital signage is one of the fastest growing segments of the industry.
According to the International Communications Industries Association’s 2004 Market Definition and Strategy Study, the audiovisual industry reported revenues of almost $18.9 billion and expects a 9.6 percent growth rate over the next five years.
This fast-growing market will likely infiltrate the quick-service market sooner than later. Along with soft-drink machines and hamburgers, high-definition television monitors could soon become a mainstay at your neighborhood quick-serve.
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Digital Signage is undeniably becoming a serious force in modern marketing. This blog is dedicated to providing readers with industry news, links to valuable online resources, and tips for integrating an effective digital signage system in your business.
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