NSR drops a stink-bomb on industry

Interesting little analysis posted today by Northern Sky Research, a Boston-based market research firm.

It looks at the state of the industry and references some of the business failures starting to bubble up here and there – something I think we will be seeing more and more.

The first thing that kicks in after working in the Digital Signage industry is that you begin to notice screens everywhere; however, as you look around to see who else is looking at the screen, a feeling of being singled out sets in. As one network operator candidly said “the only captive audience we have is people who work in the industry, the rest we have to attract.”

Yup. As a confessed digital signage nerd I also look around when I am near screens, trying to sense who else is looking. Usually, a face or two, but certainly not the mob touted as having the “opportunity to view.”

The commentary takes a look at the numbers, and some of the stories out there. It also notes a lot of the information that is getting out about the success (or lackthereof) of networks is understandably “spin-doctored” to do the old puttin’ lipstick on a pig thing.

Research into the impact of Digital Signage continues to be funded by operators who in their own best interest, would refrain from publishing any figure that lessens the impact touted by the media sales pitch. Independent industry research brings not just the good but, at the risk of an overdone cliche, the “bad” and the “ugly” of the Digital Signage industry to the fore.

Despite these negative issues, there are networks deployed that are doing it “right”. Advertisers buy in, the content is effective and relevant, and the viewer benefits from the information provided, thus everybody wins. Though success stories only find places on network operator websites, the products advertised sell and the renewal ad revenues grow year-on-year. IBM’s study in November of last year predicted that 30% of traditional media spending will move to new media over the next five years. Though one may argue what part of this goes to the Digital Signage networks, there is no doubt that budget allocations are being modified.

However (and this is the bad and the ugly) what hurts even those that do their jobs well are the networks that lay the screens without the right strategy for what will be displayed on those screens. Content continues to play for seconds (read days) and minutes (read years) longer than the average attention span commanded by the location. This is the kind of content that makes network operators file for bankruptcy in an industry that was being touted as the next big thing in advertising and IT convergence. This is also the kind of content that makes even those working in the field, who are well aware of the screen, stop watching after a second or two.

This is an industry where despite growth numbers, no one can afford to take their eyes off of the screens, not the business owners, not market analysts and most definitely not the consuming audience.

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One Comment on “NSR drops a stink-bomb on industry”

  1. Ben Caswell Says:

    Ridiculous naysaying. Ours is a nascent industry. Of course people are getting it wrong.

    And the people that come after will learn from these trailblazers. And the “bad” and the “ugly” are essential for there to be “good” in the first place.

    We have to remember that Everything About Communication is changing in our society…and that to try to assess or find or even try to establish rules or a definitive how-to is folly.

    I realize that this is VERY unsettling to those who do not have a high tolerance for ambiguity (read: analysts, researchers and most in the traditional media industry).

    However, NOT KNOWING is essential in order to move things forward.

    Advertisers have been trying to find a place to take their money where they can reach their customers’ customers for years as cable cut into broadcast eyeballs and now as internet et al cuts into cable.

    To raise this kind of a red flag is static on the line between you the industry visionary and the goal of a breakthrough…

    Ride the waves and don’t be scared off by those who fall off their boards — and especially not by those standing at the shore, waving and telling us how dangerous it is out here in the water…

    All there is… is possibility.


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