Digital Signage Market to Hit $23 Billion by 2020

Create: 05/24/2016 - 13:00

While retailers are ready to launch digital signage, finding the right technology solution can be a challenge. Smart solution providers should start getting ready now for the rise of smart signs.

Digital signage has evolved from being more than just a gimmicky tool to retailers to a must-have piece of the marketing program. “The expectation is that all major retailers will have digital signs as a way to give data back to their customers,” explains Eric Kenyon, Senior Sales Executive, Pro Av/Digital Signage, Ingram Micro. “Digital signs make a retail space more impactful, and they are a necessity for brand awareness.”

With a dizzying array of jumbo display types and technology options, many businesses are unsure where to begin, so they are turning to channel providers to configure the right solution. And the opportunity in this market is significant—and rising fast. A forecast by Markets and Markets research predicts the total digital signage market will be worth $23.76 billion by 2020. The report also notes that digital signage will experience a compound annual growth rate of 8.18 percent between 2015 and 2020. Use of digital signage helps prevent paper waste at businesses, and the incorporation of LED backlit panels in display screens can result in considerable energy savings, which aids market growth for the category.

This rapidly growing communications medium offers a wide range of innovative ways for companies to engage with customers, enhance brand awareness, showcase new inventory or close-outs and increase sales and profit margins and efficiencies. Ingram Micro notes that digital signage is becoming so popular that it is now often referred to as the “fifth screen” after film, TV, PC and the mobile device.

Dunkin’ into IoT

To date, retailers have led the way in digital signage rollouts, placing display screens in strategic places to enhance the in-store shopping experience for customers. Many organizations using digital signs can accept third-party advertising on them, creating an additional revenue stream.

Baked goods and coffee provider Dunkin’ Donuts, who serves more than 3 million customers around the globe every day, has shifted to digital menus in many of its franchise locations, using NCR Vitalcast and Intel technologies to promote its coffee, breakfast items and donuts in mouth-watering hi-def. It uses the digital signs to display the daily menu items as well as limited-time or special offers in particular locations.

“Traditional menu boards require a lot of time and resources to manage,” explains Jason Stuehmer, IT product manager at Dunkin’ Donuts. With digital signs, “the goals for us were to provide compelling media reliably and without all the clutter of physical signs.”  

Photo credit: Intevi

With the new digital menu technology in place at 2,000 locations, Dunkin’ Donuts can deliver new marketing and menu content quickly and easily. It can cater to the unique requirements of each location and also ensure consistent signage from one restaurant to the next, which improves the customer experience.

Hungry for Data

Digital signs are not just hot at restaurants. The digital display revolution is also happening in transportation centers—subway stations, airports—keeping passengers on schedule and also broadcasting revenue-producing advertising. Digital displays are also popping up on college campuses, at gas pumps, on vending machines, on outdoor billboards, inside elevators and in hotels and resorts, providing guests with service and activities information.

The analytics data that comes from digital signage is driving the rapid adoption. The emergence of IoT and increased adoption of cloud computing technology enables collection of vital operational data. Kenyan from Ingram Micro notes that using digital signage to gather predictive analytics is becoming “the number one topic of conversation among marketers and solution providers who are working on installations for their customers.” Businesses are counting on digital signs and interactive displays to gather all types of actionable data, such as the amount of foot traffic in certain areas of a store at a specific time of day to a shopper’s interest in new product launches.

For solution providers who are launching new digital signage initiatives, the focus should be on return on objective vs. return on investment for the customer, according to Ingram Micro. With so many unique options available for digital signage, choosing the right solution can be difficult. “Before we ever discuss the technology choices with a customer, we identify the main objectives for adding the signage,” says Kenyon.

While configurations vary widely, Ingram Micro advises channel providers building solutions to keep up with the latest advancements in several key areas, including hardware, software, connectivity, content/advertising, operation, design and—most importantly—the business goals and objectives. “The solution provider has to understand what the customer ultimately wants from the digital signage solution and applications. You have to understand their real objectives with the signs and analytics and how they will judge success,” Kenyon adds.

About Author

Patricia Schnaidt's picture
Patricia Schnaidt
Patricia Schnaidt is an expert business technology writer. She has held top publishing and editorial positions at InternetWeek, Network Computing, Windows Magazine and LAN Magazine. Schnaidt has written countless articles, lectured extensively, and authored "Enterprise-wide Networking" (Prentice-Hall). She holds a B.A. in Computer Science from Columbia College, Columbia University.

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