Wow! At the May 28th Chicago, DisplaySearch conference, DIGITAL SIGNAGE, THE FUTURE IS OUT-OF-HOME, the buzz was on just how big this vehicle would become and how soon.
“The Fourth Screen” is the use of video displays for Out-Of-Home advertising (with the first three being; TV, your PC and your mobile device). It was clearly viewed as an opportunity worthy of huge investments. Speakers from Panasonic, LGE, NEC, Sharp, Samsung and others debated size of screen (big is good), technologies, distribution channels, connection streams and content complexity, but they were in absolute lock-step about the billions of dollars they were each spending on new expanding plants and R&D.
Stats were fast and furious but if I got it right the domestic screen count across the 8 markets targeted total 2.5 million today. ONE vendor talked about a new plant which would be producing 7 million per YEAR when in comes on stream in a year or two. AND the units this plant provides are bigger than ANYTHING available today! Bigger is certainly viewed as better, and after doing serious research in Wrigley Field last Friday I have to admit those little TV’s with the United Airlines sponsorship look pretty unimpressive by modern standards. New plants cost $5 billion each and there are $50 billion committed, over the next four years.
Now Out-of-Home advertising is neither new nor restricted to Digital Signage. Paper signage, lite-box diarama’s and other media have been around for years. 2/3rds of the efforts today are NOT in retail, but in office buildings, airports, elevators, schools and lots of other places where people are captive. That is what we USED to be at home. We HAD to watch the commercial between innings! Now we do not have to watch any advertising (other than in-show product placements) on our home screens so……naturally advertisers are going to watch for opportunities to either force feed ads to captive audiences OR put the ad in a contextual environment (ie: in a store,….where you can DO something about it!) So, again the appeal to Out-of-Home advertising is the audience cannot TIVO you and they might see you on a screen not too far from a shelf and a check out.
So what did the speaker community at this conference agree on:
- They were going to invest billions to grab their share of this market. And if it doesn’t take off on its own, billions more on driving the change.
- Bigger, flatter, greener and smarter technology is better!
- Content is complicated, hard to come by and …wrong. Have you heard this before in this blog? New evidence this week that this is getting worse ….not better…but I digress.
- This industry needs to justify itself, its growth expectations and the billions it is spending on building plants! Sure some meager research efforts have been made but have proven inconclusive with more sizzle than steak. PRN (Premier Retail Networks, the Digital Signage Network people in Wal*Mart) and SmartRevenue a research house found a 50% incremental impact for tools in Home Depot when the screens were used, but NO change when the same technique was used for paint. Bad execution? Bad ad? Thin research? Hmmmmm.
Within the framework of my No Silver Bullet Solutions the speakers told of tying a variety of technologies together in the content, execution and application or user interface arena. A couple of cool examples: At FMI three years ago we had RFID tags put on our conference badgets. At the Chicago Hyatt last week the RFID chip would fire off any of the hallway video displays to acknowledge you as a member of the DisplaySearch conference and direct you to the next meeting room YOU were scheduled in! Another example tied a GPS system on a bus into the video display on the bus to fire off eating opportunities at the next stop.
So what are the implications for the CPG/Retail space?
- With all of that capacity and investment money you can be sure of a substantial push to put “glass” everywhere in the store. Inside and out, on the shelf, the end-cap, the ceiling and floors, the checkouts and the carts. One of the most astute speakers looked at the technology as “the last six inches” in the food chain. Obviously, there is plenty of retail space other than Mass, Grocery, Drug and Convenience…but no space where people need to be so often.
- With all that glass there will be plenty of advertising and promotion ideas and opportunities chasing manufacturer ad and promotion dollars. P.R.I.S.M. and other industry efforts will be trying to prove ROI for that budget switch from alternative media, but there will be stong pressure from trading partners to support. Could be a substantial crunch here in the next 3 years.
- The impact on traditional in-home media…cannot be anything but bad. The impact on online and mobile…not so clear. Certainly the pressure on advertisers will be to play out-of-home. However, online and mobile have some tremendous possibilities as well and when the ROI numbers are finally tallied……
The one thing I did not hear is much about the SMALL screen market, which I believe offers as much in potential and profit at retail…as do the mongo screens being developed.
At any rate this was a terrific conference and Tim Bush (CEO of DisplaySearch) and the speakers did a great job laying out challanges as well as the promise. Every once in a while it makes sense to get outside one’s industry and comfort zone, turn off the crackberry, and listen to what is going on in parallel worlds!