The use of digital signage is varied and diverse, which means the background, knowledge and skill brought to creating content to be delivered via this powerful medium is just as diverse and varied.
Consider the stark differences between a four-star hotel chain that's decided at the corporate level to use digital signs throughout its properties to welcome guests, offer wayfinding and promote various features and amenities. Now think about the local sports bar that's added digital signs to promote featured drinks and menu items while patrons quench their thirst and watch the game.
These are two entirely different types of businesses, with dramatically different resources to spend on digital signage content, varied levels of experience with using media to reach the public and quite diverse ideas about what they would like to accomplish with digital signs.
Regardless of these differences, however, the hotel chain and single sports bar -along with all other digital signage users- should share one common characteristic when it comes to digital signage: They need to determine their return on investment -not simply on the hardware and software needed but also on the digital content to be used.
Determining ROI on digital signage hardware and software is pretty straightforward. Simply divide the expense of both by their anticipated useful life in months or years. (For this example, I'll use months.) Then subtract this monthly expense from the revenue generated by the digital signs and divide this difference by the monthly expense.
For example, the ROI of a simple, single-sign system costing $6000 for hardware, software and display would look like this. Assuming a useful life of five years, or 60 months, $100 of expense should be assigned to each month of the system's useful life. If the sign generates an additional $150 in business per month, then the ROI in this example is 50 percent [that is $150 (revenue) - $100 (monthly expense of signage) = $50/$100 (monthly expense of signage) =.5].
The same sort of ROI equation can be applied to digital signage content; however, there are a few wrinkles to consider that make doing so a little trickier. First, consider that the useful life of content will be far shorter than that of the hardware and software. To be effective, that is to consistently attract the attention of patrons, content must be fresh and relevant. Thus, in a retail setting, the useful life of content will likely be measured in weeks, and possibly even days during certain times of the year.
Second, the expense side of the equation is a little more complex when it comes to digital signage content. For instance, will content be created in-house or by an outside agency? If in-house, will a new employee be required, or will an existing graphic artist take on the responsibility. Will elements of content created once be repurposed again and again in successive campaigns, thus requiring apportionment of content expenses across multiple uses? Will "free" content, such as an RSS feed, be leveraged in some campaigns and not others, thus impacting digital content expenses differently? Will the digital content be used across in multiple locations so a portion of the expense can be assigned to each location?
Third, digital signage content frequently has nothing to do with commerce. When revenue generation is not the goal of the sign, determining the ROI on content gets a little squishy. Considerations such as goodwill created among the public are much harder to quantify than dollars and cents.
Even though determining the return on investment of creating digital signage content can be difficult, it is essential. After all, doing so is the logical first step in assessing the value of any given digital signage content campaign.
David Little is a charter member of the Digital Screenmedia Association with 20 years of experience helping professionals use technology to effectively communicate. For further digital signage insight from Keywest Technology, visit our website for many helpful tips and examples. For more in-depth research from Keywest Technology, download our free digital signage white papers and case studies.