Topic: Dynamic Signage Networks: Scala’s
Rules for Success
By: Jeff Porter, Executive Vice President, Scala,
Inc.
The Power of Digital Displays
September 2001 – Dynamic Digital Signage is
popping up everywhere. Retailers such as Best
Buy use signage to coordinate the weekly specials
from the newspaper with the on-screen
messaging in the store. Wal-Mart has a network of
in-store TVs to promote “what’s new”.
Movie Theatre owners such as Regal Cinemedia use a
satellite network of digital projectors to
entertain and advertise before the feature film starts.
Fast food operators such as McDonalds
have experimented with digital menu boards to motivate
sales. Grocery stores such as
ShopRite use plasma screens behind the deli counter
to inform customers on the special of the
day, and entertain customers while waiting. Even relatively
innocuous locations such as your
local bank or your doctor’s waiting room, are
likely to have a digital display network to inform,
educate, entertain and promote products and services
relevant to that venue.
The big question is: What does it take
to make this all work? Getting the traditional advertising
or visual merchandising people, who have a lion’s
share of the clients, together with the IT and
display specialists can be challenging. It’s
not normal for these two camps to speak with each
other! And even when they do, have they considered
ALL of the ramifications that are
necessary to have a successful deployment? Example:
Many times, the software that drives the
network is not even considered, as everyone is focused
on big-ticket items like plasma screens
or satellite networks. Software is actually one of
the most critical components to operating a
profitable and successful network on a day-to-day
basis. The good news is that it’s not rocket
science any more.
As an aid to the new person looking
to deploy a network of screens, allow me to share
with
you some of my experiences over the last 15 years
in deploying such networks. Here’s my top
list of things to consider.
Content Is King
I know this sounds corny, and everyone says this,
but it is absolutely amazing how many people
are still missing the boat on content. Content MUST
be lively, relevant and appealing. It’s not
TV. It’s not the web. It’s signage. You
can’t just have the same advertising 24 hours
a day.
And it MUST be relevant to where the customer is and
what he or she is doing. For example,
I’ve seen a network in a fast food chain that
had some very nice LCD screens, but instead of up
selling the customer on the new menu item, they have
ads for toilet paper. What does this have
to do with fast food? Is this the impression you want
to give your customer? Of course not.
Wouldn’t you rather find out about the new menu
items as a customer? And as a venue owner,
wouldn’t you rather up sell your customer to
increase your revenue per customer? Of course.
The customer’s wallet is open. Go for the up-sell!
And you need to be sensitive to WHERE
your customer is. If you are a home improvement
store, selling snow blowers in the wintertime might
work well in Minneapolis, but is definitely
not going to work in New Orleans. You must have a
system that is able to generate
individualized content easily and cost effectively.
If your system is only able to play MPEGs,
how can you afford to create unique videos for each
store? And if all of your content is
MPEG, how can you afford to SEND the content. Five
hundred stores needing 1 gigabyte of
MPEG video each month is 500GB of traffic on your
network. Few retailers have this kind of
“spare bandwidth lying around”. You might
want to consider a satellite multicast network.
You also might want to look carefully at your software,
to efficiently produce lower bandwidth
content more easily.
Make Your Content Lively
If your content looks like TV, people will tune it
out. Your employees will hate the repetitive
nature of the loop. It just won’t work. You
might want to consider a system that allows you to
interface your signage easily to your point-of-sale
system, inventory management system, web
store, etc. This way your screens can automatically
adjust their price with little or no manual
intervention. This allows you to directly advertise
the same products in different stores for
different prices to maximize your profits. If your
signage network doesn’t have a call to action,
“buy now for this price”, it might not
be that effective in retail. Let’s take another
example. A
convenience store has a promotion on Sprite -- a very
effective campaign with a call to action.
Everyone is incredibly happy with the results…or
are they? On day two, sales fall to zero.
What happened? They ran out of Sprite and the driver
for Coke isn’t scheduled to restock for
another two days. Major problem. What if your system
were instead attached to the point of
sale system, where it could substitute another product
automatically when one product was sold
out. It’s possible and not hard, but will require
the right software solution and a plan up front
to deal with that possibility. Providing national,
regional, and local content can also be a way to
make your system more interesting. This sounds simple,
but have you done that before and is
your system capable of that? What impact does this
have on your production costs? Can you
make changes without re-encoding your MPEG files?
What impact does that have on the
bandwidth requirements when you now need to do national,
regional and local insertion?
Local Buy-In Is Critical
With a system that is able to do national, regional,
and local insertion (a term I borrowed from
cable TV), we’re now able to have participation
at a store-by-store level. Take a grocery store
for instance. Imagine being able to have the Store
Manager’s picture on the screen welcoming
you to his store, or perhaps Betty from the Deli department
welcoming you to her part of the
store. Perhaps the Manager can add an unadvertised
special that he needs to move. Perhaps
the bananas are looking a bit ripe, and he’s
not looking to have a sale on banana bread any time
soon. How can he push the things at a local level?
Will the signage system that you choose
empower the local staff to work WITH you, not against
you? If the employees are a part of the
network, it provides a sense on ownership and pride
to your staff, and more importantly to
you, they won’t try to sabotage the network.
Imagine a system in the same grocery store where
the screens are at the checkouts (with a really short
loop time because your customers have a short dwell
time in line), but the audio with that system is so
obnoxious that it drives the
checkout people mad. They will find a way to cut the
speaker wires, or worse yet, pull the plug
on the entire system. On top of that, I’m guessing
that you’ve just grabbed whatever TV
commercials you happen to have lying around, and the
content WOULD NOT WORK
WITHOUT AUDIO. Major problem. And let’s not
forget rule number one again… what is
your content? Are people going to “get out of
line” to go back and pick up the thing that
you
are advertising? Guess again. The products better
be within arms reach at the checkout.
Chewing gum and breath mints might be good sponsors
for this screen, but you had better
create specialized content that works without audio,
and better yet, provide some other
localized content that might be of interest to your
shoppers. Maybe there’s a community
bulletin board announcement on the system. Perhaps
include the store manager’s picture
thanking you for shopping at his store today. All
of these things can make a huge difference in
the success of your network. This is not to say that
you can’t reuse any of your b-roll from
your TV ads. Please do, but remember where the content
is going and how the viewer will
perceive it.
You Gotta Have A Hook, Location,
Location, Location
This sounds simple enough, but unless you have a reason
to look at the screen, NO ONE
WILL LOOK AT THE SCREEN! You need a “hook”
– a reason to look at the screen. It
could be as simple as a “Now Serving Ticket
number 25 at counter number 3” or as
sophisticated as a customized CNN feed from Turner
Private Networks, blasting in over
satellite, the news, weather, sports and stock headline
news four times a day that could be
interspersed with your venue specific content and
advertising. How easily does your system
integrate with these sorts of “hooks”?
Guess what? It’s back to what software you choose.
(that little annoyance that no one thinks about until
it is too late!).
And let’s not forget the famous real estate
saying “location, location, location”.
This is
absolutely true in signage networks today. Proper
placement of the screens with the
appropriate content is absolutely critical. No one
is going to strain his or her neck to look 12
feet up in the air at a cheap TV set. Screens by the
check out are “too late” unless you’re
selling chewing gum or breath mints. Find a location
where people need to visit or have a
natural waiting time and, hopefully, your content
will be able to influence purchase decision at
the last minute while improving the overall customer
experience.
Is It Easy To Do Small Updates?
Everyone can do a big update. No problem. Just send
hundreds of MPEGs to each location.
Brute force and ignorance can make this happen (although
perhaps not as easily as you might
have originally thought). But what if you need to
just update the price of something at the last
minute? How hard is that? How long does that take
to make the change? And how many
megabytes (or better yet kilobytes) do you need to
send in order to make this change? And if
we’re talking megabytes, how long will it take
to transmit, for instance, 100 megabytes to 500
stores for a “simple price change”? Choosing
the right architecture can make the difference
between a system that is a joy to work with and a
system that looks to your IT department as a
“denial of service attack”. Obviously
having a system that can do small updates with small
file
sizes makes this a breeze
Yopu Must Have A Closed Loop
System
One of the key drivers in terms of a network of advertising
based displays is the revenue you
can expect to get from the ads. This is measured in
CPM (cost per thousand viewers). Some
signage networks have failed in the past because they
were not able to get a high enough CPM
to cover their costs. Obviously having a cost effective
network is key, but don’t forget that this
should not jeopardize your CPMs. The best way to achieve
higher CPMs with advertisers is to
be able to prove to them with affidavits that the
ads actually ran as scheduled, with full ability
to drill down to a specific ad in a specific location.
In order to support this, you’ll need a twoway
network to return those “billing logs”
and to roll that up into a report that can be sliced
and diced by the advertiser. Having a cheaper one-way
satellite network with no return might
sound good to your CFO, but it may have an adverse
impact on your ability to charge a
premium CPM because you can’t prove that any
ads ran. And you will need the back office
system to keep track of this for billing purposes
as well. Make sure you look into this aspect
when choosing a system. Having a full two-way network
also brings the possibility of
continuous monitoring of your network. Your Network
Operations people can then proactively
respond to a fault in the network, instead of waiting
for the phone to ring (if anyone
bothers to call at all with a one-way network).
“Please Don't Make Me
Talk To The IT Guys! Isn't There A Better Way?”
A large number of signage deployments today are actually
done by sending around VHS tapes
and DVDs in the mail. It’s the problem mentioned
at the opening of this article where no one
wants to talk with the IT department, because they
always say “no”. So the merchandisers
and
advertisers alike think, “No problem, I’ll
just use a DVD!” I can honestly say that this
is a
mistake. It is extremely prone to human error (getting
the right disc or tape in at the right time
and pressing play) and very expensive to feed. I’ve
seen situations where companies have
switched from sending out monthly DVDs to biweekly
updates with a full-featured network,
where their costs were LOWERED substantially by moving
away from DVDs. Plus they are
able to update their screens more easily and more
often (for less money). It’s a win-win. So,
it’s probably a good idea to talk to your IT
group and show them a solution that will not be a
“denial of service attack” on their network,
and they’ll thank you for thinking of them up
front.
With a DVD or VHS network you have what
is called a “SneakerNet” – very
prone to human
errors. Plus, because the system is not connected,
you have no billing affidavits, so your CPMs
are very low. Making the content in the first place
is very expensive (burning DVDs) and you
can really only afford to do this once per month.
If you run weekly specials, it’s impossible
to
advertise those on your screens because you’re
running the same loop every week for a month.
With a networked system, you’ll be able to change
this on the fly easily and have completely
synchronized media campaigns, both in-store and in-home.
Let’s hope that your creative team
doesn’t make a typo with your DVDs, because
re-burning hundreds of DVDs and sending
them out is time consuming and expensive. On top of
that, your average cheap consumer
DVD player is only rated for about 2000 hours of operation.
So plan on swapping out burned
out DVD players every 3 or 4 months – not a
pretty sight. And for the final nail in the coffin,
consider the video quality. If you are driving a plasma
screen with a DVD player over
composite video, the picture is going to look unbelievably
fuzzy. This is true for even many
networked MPEG players. If you’re driving your
screens in a one-to-one pixel ratio from a
VGA based PC, the clarity of the resulting image is
going to be night and day better.
Bottom line: Don’t use a DVD player, and if
you’re still using VHS, get into the 21st century,
please!
Do More Than Just One Thing
As long as you are deploying a signage network for
your customers, why not consider using the
same infrastructure for employee information or employee
training? This is a biggie. A
number of deployments that I’ve been involved
with have found that the employee facing
screens have done a more significant job of influencing
purchasing decisions than the customer
facing screens! Think about it. You have a high turn
over of staff. Your customers need to
ask one of your employees a question. Even modest
amounts of subliminal training from your
signage network can educate your staff enough to be
a genius in the eyes of your customer.
With an even more proactive training initiative using
the same infrastructure, you can track
exactly who has, and who has not, watched the training
videos (which are now digital so that
the tapes don’t get lost). So don’t forget
the employee angle of a signage network. Maybe it’s
just an hour before the store opens. Maybe it’s
interspersed throughout the day. Maybe the
CEO wants to do a live broadcast to all the employees
in each store before it opens. You
could even have live events in-stores. A few years
ago, Wal-Mart broadcast live a Faith Hill
concert in all of their stores. Reportedly, this was
the single largest take in Wal-Mart’s history.
This was a major event, and was only possible because
they were able to re-use their existing
signage network. Perhaps you were looking at doing
some interactive kiosks. Perhaps you’d
like to speed up your credit card transactions (instead
of dial-up phone lines today). Why not
hook them into the same infrastructure? Your signage
network can be the catalyst for many
powerful things, which all help to offset the investment.
You Can't Put A Dish Everywhere
While some of these advanced uses might require a
satellite system, the costs to deploy a digital
satellite network have never been as available and
cost effective as they are today (thanks to
technology born from direct to home digital satellite
TV). Satellite has a ubiquitous footprint
(meaning you can put a dish practically anywhere and
be connected). However, there are areas
where getting a southern exposure to the satellite
and putting in a satellite dish are prohibitively
expensive – Manhattan for instance. Paying for
roof rights can be very expensive there.
Fortunately many signage systems can handle a hybrid
network topology where some locations
are terrestrially connected, and others are satellite.
Double-check that however. Also your
satellite provider may be able to offer an alternative,
since they deal with this sort of situation
every day. Other alternatives might be DSL, but you
had better do a site analysis on every
location, because all of your locations might not
be within range. WiFi (802.11b) is another
choice, but the coverage maps today from companies
such as T-Mobile, Verizon, Boingo, and
others might look good on paper, but in reality are
very spotty at best (unless your name is
Starbucks). Digital cellular connections might be
a good alternative, if your content is not too
bulky. With these services you can get upwards of
56Kbps (and perhaps 144Kbps) with better
coverage than WiFi, but at a substantially lower bandwidth.
Piggybacking on an existing
network infrastructure can work, but not if you’re
going to be sending large MPEG files.
Sometimes the best approach is a satellite “overlay”
network with a terrestrial return. This
gives you a low cost multicast one-way network, while
using the existing terrestrial
infrastructure for the small amount of data needed
to verify transmission and system status.
Sell Signage Like End Caps
Retailers often get a significant amount of revenue
from their vendors in terms of co-op, MDF
(market development funds), spiffs and other incentives
to the channel. “You’d like to have a
good position in the store for your product Mr. Manufacturer?
No problem. It costs an extra
$5,000 per month per store for that.” It’s
big money and retailers guard this heavily. In-store
signage should be sold the same way. This has a dual
benefit. Not only will the retailer be able
to extract more funds from the manufacturers, but
because of the effects of the signage display,
more products will be moving through the store on
an average day. Uplift in sales of
advertised products have been measured anywhere in
the 20% to 40% range. This also
generates more turns on inventory – everybody
wins. Some are fearful that this new medium
will “rob Peter to pay Paul” from the
precious co-op dollars. This has not been my experience
to date. New money is actually found for these new
opportunities.
In public networks, such as a shopping
mall or electronic outdoor billboards, it may be
necessary to have a higher level system in place to
keep track of the “avails” (available
slots
open for advertising) and managing the deployment
of ads to the network. In all likelihood, no
two screens would be playing the same sequence of
ads in this scenario, so it is very important
to make sure you have a software system that can keep
track of all of these things. Of course,
the same system can help you slice and dice the network
into demographic and geographic
regions to aid the sales process for a particular
campaign.
Don't Fight The PC Industry
I’m a big believer in industry standard technology.
It’s absolutely amazing what multimedia
power is built into the average $500 PC today, which
seems to get cheaper and cheaper each
day. Don’t fight it. Go with the flow. Locking
yourself into a proprietary design will only lead
to heartburn down the road. Maybe the proprietary
system that you’ve selected is perfect for
the one thing you need today. What happens tomorrow
when you have a new requirement that
you hadn’t thought about before? Do you end
of scrapping the entire infrastructure? That can
get expensive. A programmable system on industry standard
hardware has the flexibility to
grow and adapt to the changing requirements, without
having to swap out the hardware. As
one senior IT manager of a Fortune 500 company told
me one time, “Jeff, I already manage a
network of 12,000 PCs. What’s another couple
thousand?” Chances are these companies have
a four-hour on-site maintenance contract with IBM,
HP or Dell and they have a pallet load of
these standard PCs in the warehouse today. Use them.
Even with a new requirement such as
High Definition Video support can be easily done with
a PC today (with the right choice of
hardware and software).
Anyone Can Do A Pilot, But Does
It Scale?
There are plenty of suppliers doing small pilot projects
with brute force and ignorance (and
sometimes SneakerNet), but what happens when you have
to scale for real? Does the system
really handle that well? What are the limitations?
How many 1000 unit deployments has the
prospective supplier been involved with? These are
tough questions that have to be asked. Are
the systems reliable? Do they operate 24/7? What happens
if you only have dial-up
connections? Does the system still scale? Can the
system work in a hybrid of both high speed
and low speed networks? What are the implications
in terms of content to support this? Is it
reasonable to assume that your chosen network can
support this content in a reasonable
fashion? There are lots of tough questions to ask
your future suppliers. These are all very
critical to the overall success of your network.
My hope is that this introduction has
given you enough of the basics to get started with
your
own successful dynamic digital signage network. It’s
a very exciting industry and I wish you the
best of luck.
About The Authour
Jeff Porter is Executive Vice President of Scala,
Inc., the leading supplier of software solutions
for dynamic signage networks. Mr. Porter has been
employed by Scala in various capacities
since 1994. Scala today has over 15,000 units deployed
plus two networks of over 1000 units
each. Scala’s InfoChannel 3 software suite is
an off-the-shelf solution for dynamic signage
networks and is in its third generation release. Prior
to Scala, Commodore International
Limited employed Mr. Porter, where he was responsible
for worldwide product development
of the Amiga computer from 1984 to 1994. He previously
worked for AT&T Bell Labs and
The Eastman Kodak Company. Mr. Porter holds a Masters
degree in Engineering from the
University of Illinois and a BSEE from Purdue University.
