Drawing Attention

Some of the earliest versions of digital signage appeared in casinos, but their implementation in Europe helped retail join the game. “There was a dramatically different adoption there vs. here,” says Steven Keith Platt, director and research fellow of the Platt Retail Institute.

Domestic retailers have been a little slower to take hold, but interest is growing. That’s expected, Platt says, since it “captivates the consumer’s eyeball to the motion of video.” Add in the power of personal communication devices and these digital signage programs have the power to connect with shoppers at every step along their purchasing path.

“It is nothing more than a muted television, but its power is its ability to deliver compelling messages and imaging,” says Alex Romanov, president and CEO of iSign Media, a Toronto-based provider of interactive media solutions.

“The technology can produce between 2 and 3 percent lift on impulse, non-frequently purchased items,” Platt says, “and between 11 and 12 percent increases on frequently purchased consumables.”

Based on these results, why haven’t more chains made the leap into the technology? For starters, a digital signage program requires a technical and operational commitment: Besides a screen and a player that pushes content to the screen, retailers need to invest in content management software and establish a team to maintain the program.

Retailers must combine predictive modeling and point-of-sale data to determine the best times to play specific content. Meanwhile, they must also be mindful of the complex balance between their own promotional schedules and those of supplier partners.

Challenges aside, companies worldwide remain attracted to the technology. “Growth has been increasing steadily since 2007, and it even continued through the recession,” Romanov says.
The secret to making it work is retailers’ commitment to localization “and the ability to target the shopper,” Platt says. “If you don’t localize messages, then the signage is no different than a television broadcasting — no one will pay attention.”

Harrods, the London-based luxury department store, launched its digital signage program six years ago. Premium brands can buy ads that are integrated with other in-store media, including posters, signage on elevator doors and windows and print ads. Two hundred screens are strategically placed next to escalator banks, stairwells and key entrances. Shoppers view 15-second ads; each screen displays the same content simultaneously.

The company has dedicated ad sales, operations, technical and creative teams that maintain the program, and Harrods monitors campaign saturation based on related sales data.

The retailer continues to invest in digital signage due to its ability to generate advertising income and drive in-store sales. “Ad revenues continue to grow as luxury brands become more comfortable with the digital medium and appreciate its flexibility, creativity and immediacy,” says Guy Cheston, director of advertising sales and sponsorship with Harrods.

“Many advertisers have seen an increase in sales as a result of brand campaigns on digital screens in-store.”

Opportunities abound
Mac’s Convenience Stores, a subsidiary of Alimentation Couche-Tard based in Ontario, began its journey into digital signage in 2006: By 2008, all 1,400 stores were supporting three screens each. A 32-inch screen is located behind the checkout counter; another is placed in a frequently visited area of store, such as the cooler area. A smaller, eye-level 17-inch screen is at the POS — one half of this screen displays the order as it is rung up, while the other half delivers advertising messages during the transaction.

Mac’s creates its own content, and Toronto’s Pinpoint Media Group manages upload into the digital network and distribution across the enterprise.

The technology’s ability to localize messages makes all the difference for Mac’s. If a shopper is buying a cup of coffee, the sign may have an ad for mints or chewing gum. “It is an opportunity that no other medium, like television or billboards, has been able to do at critical times during the shopping trip,” says Donna Yuen, senior marketing manager for Mac’s. “Contact drives impact, and this technology provides a lot more opportunity for us to do that.”

The chain is also integrating other advertising methods to drive traffic to the store. “We are layering point-of-purchase and other signage, as well as leveraging social media, to invite shoppers into the store and look for a daily code available on-screen for a special promotion,” Yuen says. “It is all about experimenting.”

Mac’s is also running a limited test of a software-as-a-service (SaaS) solution from iSign that uses Bluetooth technology to detect shoppers’ smartphones from up to 300 feet away.

“When the phone is identified, the software sends them a personalized message and gives the shopper the option to accept or decline,” Romanov says. “Traditional digital signage cannot prove how many people passed it or who was encouraged by the message to make a purchase. Whether the smartphone promotion is accepted or declined … the interaction location, day, time and result are recorded.”

Besides allowing retailers to measure redemption rates and the effectiveness of promotions, this data allows the retailer to build a profile of individual shoppers and their preferences. The software is integrated within at least one sign in each participating store and identifies an average of up to 3,000 smartphones daily, Romanov says.

The key is for retailers to use the technology to aid in their overall selling efforts. “Retailers need to consider how they touch the consumer during their entire purchase path,” says Platt. “Retailers need to focus on integrating all solutions to work together versus just relying on pure digital signage. We’ve overcome the original hurdles and the technology has become an efficient and effective communications solution.

“Once chains figure out how to leverage other technology with it, it will be a much more profitable option,” he says.