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Well it appears that the 800-pound gorilla Google has set its sights set on
the digital signage market.
NewScientist.com broke the story earlier this month that the search-engine
company has filed for a patent on a way to divvy up ads on a network of
electronic signs. The ideas seems to be to give retailers and others a simple
way to organize an advertising campaign to promote inventory on, for example, a
digital signage network display or displays near their stores in a mall.
Just as Google allows advertisers on the search engine to specify
characteristics of their online ad campaigns, such as what keywords to use, how
much money to spend, and what to say in ads, the new Google system is likely to
give retailers a way to get very specific about what product is advertised, how
and where it’s advertised and how much will be spent to advertise it.
Granted, Google is only at the patent filing stage, and it’s much too soon to
discuss this approach in detail. However, that’s not what’s important. The point
is that Google’s approach is another sign that digital signage networks are
organizing into a market that can be meaningful to advertisers. Google’s patent
filing is further evidence digital signage is quickly transforming from an
amorphous marketing concept into a concrete, definable reality.
Like the November ’06 Screen Association announcement of the first directory of
UK-based digital signage networks that accept third-party advertising and the
news a month later of the formation of Nielsen In-Store to help marketers
quantify in-store audiences, the Google patent move is a further indicator that
digital signage networks are coming of age as a legitimate, quantifiable ad
medium.
Another is the financial health of the out-of-home advertising market, which in
2007 is expected to be the second fastest growing advertising medium behind the
Internet. A New Year’s Day article at MediaWeek.com quotes a forecast from
private equity and mezzanine capital investment firm Veronis Suhler Stevenson as
saying the out-of-home ad market will grow 6.7 percent to $7.25 billion,
following a 7.9 percent growth rate in 2006. It goes on to say
PricewaterhouseCoopers projects even stronger growth of 7.9 percent for 2007.
To be sure, out-of-home advertising encompasses many things, like digital and
conventional billboards, cinema and mobile (i.e. bus, taxi, etc.) However, it
also includes digital signage networks, which surely will stake out a growing
piece of the out-of-home ad pie as they organize further into a media buy
individual companies and ad agencies can measure and understand.
That could not come at a better time as ad agencies and ad buyers increasingly
question how effective their traditional television and print ads are. Digital
video recorders (DVRs) and video on demand are giving television viewers more
control over what they watch and when. Zapping commercials –fast forwarding past
them- continues to grow along with consumer uptake of digital video recorders.
Newspapers aren’t delivering the audience they once did. Circulation is down
nationwide and that’s taking its toll on the commercial value of the medium. One
need look no further than McClatchy Co.’s sale of the Minneapolis Star Tribune
for about half of the $1.2 billion purchase price the publishing company paid in
1998 to see the impact of falling circulation.
All of these factors –including the congealing of digital signage networks into
a quantifiable market, new convenient ways for retailers to ties their
inventories to ads on digital signs near their stores, TV commercial zapping and
the decline in newspaper circulation- point out that digital signage advertising
is poised to skyrocket to new heights in 2007.
David Little is a digital signage authority with 20 years of experience helping
professionals use technology to more effectively communicate their unique
marketing messages. He is the director of marketing for Keywest Technology in
Lenexa, KS, a software development company specializing in systems for digital
signage creation, scheduling, management and playback. For further insight,
download my free white paper Why Digital Signage Works. It gives a quick
overview from an industry perspective on the fundamentals of digital signage.
Included are some recently published findings by Neilsen Media Research on the
measured impact of strategically placed digital signs. And while you are
browsing our web site (http://www.keywesttechnology.com),
sign up and take advantage of our free weekly Webinars that give you hands-on
experience with our digital signage software.
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