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Making the Case for Digital Signage: ROO vs. ROI

By Earl Naegele, Managing Director, Commercial Sales, Peerless-AV

Earl Naegele, Managing Director, Commercial Sales, Peerless-AV

Digital signage is growing in tandem with technological advancements and changes in communication styles and processes. In this day and age, the expectation is that fresh information is readily available and information shared via digital signage is fresh and up-to-date. These changes necessitate alterations in measurement—we’re no longer just running ads on digital signage. We’re sharing news or promotions, providing way finding, entertainment, and more.

ROO vs. ROI

Culturally, we place significance in keeping up with the times. Still, there will be individuals hesitant to readily accept change, particularly when new technology may seem costly. These are the folks you will need to validate expenditures with as it relates to Return on Investment (ROI) and Return on Objective (ROO). To determine ROI and ROO, you must define the function of your digital signage.

"In this day and age, the expectation is that fresh information is readily available and information shared via digital signage is fresh and up-to-date"

While ROI considers your return on investment, the amount spent versus hard dollars returned over time, ROO considers your return on objective. For digital signage, often ROO needs greater attention, as our true objective and function is communication.

How does one measure ROO? To define your ROO, you must consider: what will my content communicate, to who will it communicate, and where? Your target audience may be customers or employees and your goals could vary vastly from wayfinding to retail calls to action.

If your content’s function is wayfinding, does your welcome desk garner less lost visitors? If your content promotes sales, are more customers entering your store aware of these sales? Additionally, both a trend in content and an aid in measurement is social media. Does your signage contain a QR code or NFC and Bluetooth capabilities to track and connect to customers in real time? A hashtag? Does it contain an in-store call to action or a promotional code only featured on your digital signs? These are ways to add numerical values to levels of engagement for analysis.

Costs vs. Benefits

The future looks bright for measurement surrounding engagement through digital content, with the beginnings of anonymous video analytics (AVA) alluding to the possibility of digital signs readily incorporating technology that can measure gender, demographics, engagement levels, and more.

Furthermore, benefits in expanding digital signage versus static signage exist in ease of use and reductions in operational costs. In addition to removing the costs of printing and replacing signs, large buildings, which incorporate multiple displays, offer the ability to network displays together to repeat messages in multiple places, allowing company-wide news and emergency alerts to quickly and easily be dispersed.

Still, ROI of course needn’t be disregarded. However, rather than the more traditional focus on what call to action the signage may have caused, it is more important to also consider ROI in terms of operations.

While the upfront costs of digital signage may seem high, it is of utmost importance not to cut corners. For example, integrators could be tempted to use consumer TVs as they are less expensive, but using these outsidenegates their warranty. What should be determined is the length of time displays will be active and the cost of maintenance and service. Oftentimes, a reduced cost at the time of purchase will amount to moremoney spent in the long run due to additional service costs.

For outdoor spaces, features like safety glass improve longevity, while optic bonding reduces glare and makes the display stronger. It also reduces the solar load, keeping it cool and negating the need for fans and filters or air-conditioned, protective enclosures—ultimately decreasing energy consumption and maintenance costs.

Indoors, the choice between an LCD and LED display can result in lower costs. LCD displays use less energy than traditional tube displays by utilizing the light modulating properties of crystals. However, while LCD displays do use less energy, LED displays can result in a 30 percent to 60 percent reduction in energy and power consumption—a huge savings when using multiple displays.

Beyond selecting solid hardware that may reduce energy consumption, the way to reduce maintenance costs is quite simple: perform maintenance. A proper service package/regimen is the best way to reduce costly malfunctions. Further, a remote monitoring system can keep an eye on signage, while negating the cost of the hours needed for displays to be checked on physically.

At the end of the day, when considering expansion in digital signage as it relates to ROO, one must consider what their signage will communicate, where it will be located, and why. And, is it truly engaging?

As relative to ROI, it’s important to consider not only the upfront cost, but also the costs of content development, software, maintenance, and service.

When your ultimate function is communication,what’s the best way to communicate your message? In the most engaging way possible!

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