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Digital Signage


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Digital Signage

  1. 1. 1 Elizabeth Hay May 13, 2014 Digital Signage Industry in a Boom: Consumers Hold Key to the Future "I promise that I have not violated the Pathfinder statement on academic dishonesty. I understand the punishment that I will receive if I have violated this policy." ___________________________________ Signature
  2. 2. 2 Introduction Digital signage is a billion-dollar industry (Wilkinson & Kolodzy, 2012, p. 140). Millions of screens already exist. The number of screens and the digital signage market is expected to grow in coming years. Digital signage is defined as “the use of electronic displays or screens… to deliver entertainment, information and/or advertising in public or private spaces, outside of home” (Wilkinson & Kolodzy, 2012, p. 133). Schaeffler (2008) said, “Pure and simple, digital signage is an answer… because… it presents new opportunities and alternatives for [advertisers] and retailers” (p. xix). Digital signage not only includes advertising for retail industries, but also includes many other industries like transportation, healthcare, hospitality, education, art, and news (Wilkinson & Kolodzy, 2012, pp. 136-139). Digital signage is meant to be an experience that engages and connects audiences. It incorporates text, photos, video, graphics, and involves projection, plasma, LCD, LED screens, touchscreens, or even mobile phone screens. Digital signage has its own trade organizations, scholarly magazines, textbooks, and websites dedicated to educating people about this technology. Digital signage is not a new technology. It has a long history, originating from a combination of many other technologies, as far back as televisions and as recent as the Internet. There are a variety of types of digital signs. It continues to grow and be improved upon, but also sparks controversy when it comes to privacy. It has caused many effects on the mass communication field, as well as in marketing and retailing strategies. Background Digital signage stems from a large variety of former technologies (Wilkinson & Kolodzy, 2012, p. 134). It has roots in advertising mediums like billboards and flyers, often referred to as
  3. 3. 3 Digital Out-Of-Home (DOOH). It has emerged from video recorders, audio and visual equipment, media players, and television and computer screens. Software, cable, and Internet networks also make up digital signage, which have had their own evolutions over the past several decades. Digital signage has evolved from TVs and VCR players to LED, LCD, plasma, and HDTV screens connected to Internet servers. Digital signs have adopted flat screens with better brightness, image retention, resolution, and size variation. The software that runs digital signage can either be premised-based or delivered via the Internet, which is referred to as Software as a Service (SaaS). With SaaS systems, content is delivered from off-site servers or the cloud to digital screens so there is no need to install in- house servers. With premise-based content management systems, in-house servers are required but there is greater flexibility on what is displayed on digital screens and also better security. Micro Industries, a digital signage designer and manufacturer, has advanced security systems built into its digital signage software (Micro Industries, n.d.). Their Touch&Go Runtime management system has an encryption scheme and its own browser, “which is designed specifically not to go anyplace that it’s not told to go” (par. 1). Additionally, digital signage provider MediaTile, recommends that digital signage network operators can enhance security if they change passwords often, create strong passwords, do not allow a browser to remember a password, and do not use email to send username and password information (MediaTile, n.d.) The servers that store all the software, applications, programs, and content management systems used in digital signage (whether on or off site) make up a “storage network” (Paulsen, 2011, p. xvii). Paulsen (2011) explained that storage networks are part of “the overall system of tools that users employ to do their work” (p. xvii). As compared to the days of floppy disks and videotape, storage systems are more like “digital workflows” (p. xvii).
  4. 4. 4 Digital signage is used in a variety of industries (Wilkinson & Kolodzy, 2012, pp. 136- 139). It is used in hospitals, clinics, and doctors’ offices. These locations are considered points of wait. It is displayed at points of sale like stores and malls, movie theaters, restaurants, gas stations, casinos, supermarkets, and hotels. It is used at points of transit; going beyond airports that show flight times, to subway stations, taxis, along highways, and in the streets. It is also displayed in places of worship. Digital signage communicates a wide range of information. Advertising on digital signs can include directions, coupons, schedules, art, news, AMBER alerts, and recipes. Modern digital signs are meant to be interactive and engaging for users. Instead of giving people something to look at or see, digital signs give people something to watch or do. Ads are no longer just text or still-images. Now ads have audio, video, graphics, and animation of some kind. Touchscreens and interactive kiosks that are capable of linking to cell phones keep people busy for a few minutes. This could potentially lead people to buy something. Games can also be incorporated into digital signs. According to Lundström (2008), digital signs have the unique opportunity to be customized for a certain time of day, application, and geographic location (p. xii). Digital signage has been dubbed the “fifth screen,” coming after cinema, TV, computers, and mobile phones (Kelsen, 2010 as cited in Wilkinson & Kolodzy, 2012, p. 136). Kelsen (2010) wrote: As with every screen that came before, the most important element of the 5th screen is not the technology behind it but the content it delivers. Without the right content, delivered with a clear understanding of the power of digital signage, the technology can’t deliver value, can’t motivate consumers, and can’t bolster brands. Those who understand how to
  5. 5. 5 create content that works for digital signage will be the ones who will reap the benefits (p. xx). The Digital Signage Federation was established in 2010 to be a voice for improvement and promotion of the industry (Digital Signage Federation, n.d.). They work on a wide variety of projects including doing research on the industry, creating privacy standards, and hosting events like the Digital Signage Expo, which is attended by companies from around the world (Digital Signage Federation, n.d.; Keene, 2014). The Federation is operated by volunteers and is a not- for-profit organization. Started in 2006, the Digital Place-Based Advertising Association (DPAA) is another not-for-profit trade organization in the industry (Digital Place-Based Advertising Association, n.d.). The DPAA’s mission is: To drive consistent growth for the industry through collaboration among advertisers, agencies, place-based digital and video advertising networks and their suppliers… [It] is the only trade organization dedicated to making it easier for marketers and agencies to plan, buy and evaluate the effectiveness of digital place-based advertising networks (para. 2). Current Status Current research suggests that digital signage is in the growth phase of its lifecycle (Meadows, 2012, p. 28). Intel predicts there to be 22 million digital signs by 2015 (Avalos, 2011, as cited in Wilkinson & Kolodzy, 2012, p. 140). Global Industry Analysis Inc. predicts the global digital signage market to reach $14 billion in 2017 (Global digital signage, 2011, as cited in Wilkinson & Kolodzy, 2012, p. 140). The Economist predicts spending on digital billboards and posters to go from $2.6 billion in 2011 to $5.2 billion in 2016 (Billboard boom, 2011, as cited in Wilkinson & Kolodzy, 2012, p. 141). There are about 400,000 regular billboards in the U.S.;
  6. 6. 6 there are approximately over 3,000 digital billboards (Levin, 2012, as cited in Wilkinson & Kolodzy, 2012, p. 140). According to Cotterhill (2013), the top ten American digital signage providers last year were BroadSign, STRATACACHE, Real Digital Media, SignageLive, Ayuda Media Systems, Scala, ONELAN, YCD Multimedia, Omnivex, and Four Winds Interactive (in that order). Experts predict digital signage to get bigger not just in the number of signs, but also in the size of signs (Wilkinson & Kolodzy. 2012, p. 141). JetBlue Airways built a 36-foot tall digital sign in its Long Island airport in 2012, with 14 LCD screens spanning three floors. In 2011, the Vatican Museum installed a 50-inch, 65-inch, and 103-inch plasma display to enhance visitors’ experiences (“Panasonic,” 2011). To boost security with high picture quality and real time video, they also use dozens of 42-inch displays in a wall configuration for the museum’s control room. Will the adoption of 4K TVs coincide with the growth of digital signage? 4K TV was discussed at a webinar hosted by Digital Signage Today and Omnivex Corp., appropriately called “Emerging Digital Signage Technologies: Breaking Through the Hype” (“Navigating,” 2014). CEO and Director of Software Development at Omnivex Doug Bannister said, “4K screens will become mainstream eventually, but they’re not you there yet” (Display section, para. 3). The challenge, he suggested, is the lack of 4K content. Likewise, president and chief operating officer of ExpoNation, LLC (producer of the Digital Signage Expo) Chris Gibbs said, “4K is here to stay and grow. Expect to see these installations in high-end retail and other showcase type environments initially, with other markets following once the technology becomes more mainstream (Keene, 2014, p. 20). Digital signage is also getting smaller, with more integration with mobile phones and
  7. 7. 7 tablets (Wilkinson & Kolodzy, 2012). Digital signage is contributing to the growth of mobile commerce, which is exploding thanks to technology improvements like 3G, 4G, Wi-Fi, NFC, Bluetooth, RFID, and SMS (Lee, 2012; “Navigating,” 2014). Almost 77 million Americans had a smartphone in 2011 (Amobi, 2011 as cited by Brown, 2012). During the webinar mentioned previously, Bannister discussed mobile technologies like QR codes, NFC, and Bluetooth (“Navigating,” 2014). According to Bannister, all these offer benefits to consumers and deplorers. NFC, explained Lee (2012), “enables a secure exchange of information between mobile devices in the close distance at a relatively low transfer rate. It is suited for transmitting small amounts of information with minimal set-up time and power consumption” (p. 9). QR codes are used for in-store mobile marketing by 75% of retailers, reported and Forrester Research (Tode, 2012 as cited in Lee, 2012). Sixty-six percent of Americans have used their smartphones to shop (eMarketer, 2012 as cited in Lee, 2012, p. 7). With millions of smartphones and tablet users in the U.S., smartphone integration could greatly enhance the digital signage and retail industries (Keene, 2014). Furthermore, advancements like facial recognition software that are capable of guessing a user’s age and gender are underway (Wilkinson & Kolodzy, 2012). But will these technologies be too intrusive? In order to protect the general public, the Digital Signage Federation has established privacy and protection guidelines for companies using digital signs. Their guidelines are as follows: According to Geiger (2011),…companies should obtain consumers’ opt-in consent before collecting directly identifiable information to digital signage (such as facial recognition or behavioral tracking). Companies are prohibited from collecting information on minors under 13 (or as defined by state law) through digital signage. Companies should also
  8. 8. 8 provide notice of any ongoing data collection in the physical location in which digital signage units operate (as cited in Wilkinson & Kolodzy, 2012, p. 138). The Federal Trade Commission also issued their own rules for facial recognition software in 2012 (Eggerton, 2012). Their guidelines allow software to detect age, gender and reactions for targeted ads or videos, but children are to be excluded. Consumers must also be informed when facial recognition is in use and have a choice to opt-in or out of data collection. In addition, advances are coming to the healthcare field. AVT Inc., and Opticwash have created a unique, self-service kiosk (“Opticwash,” 2014). Using sterilized water and ultraviolet light to kill bacteria, Opticwash cleans and sanitizes eye glasses, sunglasses, and jewelry quickly. The kiosks have been beta tested at military bases, shopping malls, hotels, and airports. With over 4 billion people in the world wearing sunglasses or corrective lenses, the Opticwash has a very large potential market. Digital signs in pharmacies are proving to be effective for advertisers according to Nielson research (“Nielsen,” 2014). Targeting pharmacy customers at the point-of-purchase, Cardinal Health’s digital screens deliver health related content through the Pharmacy Health Network. Research conducted by Nielsen found that the Pharmacy Health Network reached almost three million people in a four-week period. Additionally, “63% of viewers recalled advertisements on Pharmacy Health Network; 91% of viewers indicated that the Pharmacy Health Network was informative; and 74% indicated ads are more believable when viewed in the pharmacy” (para. 2). Many innovations are expected for the transportation field. Trends like step-by-step directions, directories, and maps are expected to arise, according to Four Winds Interactive CEO, David Levin (2012, as cited in Wilkinson & Kolodzy, 2012, p. 141). According to Strauss (2013), the average American commuter spends a little under one hour is his or her car each day.
  9. 9. 9 Consequently, Departments of Transportation are using this as an opportunity to advertise on roadside billboards, often sponsoring safety in collaboration with 511 Traveler Information Systems. In March this year, digital signs networked by PATTISON Onestop on Toronto’s subway platforms displayed poetry written by Canadian hip-hop artists (“Subway Screens,” 2014). The poetry showcase was called “Lyrics To Go” and is part of PATTISON’s Art in Transit program. In April this year, the Metropolitan Transportation Authority joined the DPAA (“MTA,” 2014). The MTA’s New York Transit Division is planning to add over 100 “On the Go” digital screens at subway stations in four New York boroughs. “MTA’s ambitious initiative speaks to the emergence of digital place-based media as a powerful vehicle to reach consumers on their daily journeys,” said chief executive officer and president of the DPAA Berry Frey (para. 3). Developments in the hospitality field are coming as well. Inwindow Outdoor and Intel’s “Experience Stations” arrived in malls and hotels in 2012 (Wilkinson & Kolodzy, 2012, p. 138). These kiosks measure seven feet in height, have 70-inch HD screens, are NFC capable, use multi-touch screens, detect motion, and use Intel AIM Suite software to determine a user’s age and gender. In February of this year, Las Vegas casino and hotel Boulder Station revamped its digital signage network to include over 150 HD media players and screens in 20 different locations (“Digital,” 2014, p. 30). “Interactivity is everywhere,” according to Intel’s José Avalos (2012, as cited in Wilkinson & Kolodzy, 2012, p. 138). From huge screens to tiny screens, NFC to QR codes, facial recognition software to eyeglass cleaning kiosks, and hotels to subway stations, it seems that convergence is key to the digital signage industry. True to the definition of convergence, digital signage is erasing the distinctions among media (Baran & Davis, 2012, p. 22).
  10. 10. 10 Effects Digital signs affect the way people communicate (Wilkinson & Kolodzy, 2012, p. 133). It influences what people eat, watch, where people travel, what people buy, and what people do not buy. It is another medium gone digital and just one chapter of the digital era (Brown, 2012, p. 18). Chris Gibbs (previously mentioned on page 6) said, “With the proliferation of mobile and tablet devices, consumers of all types are more comfortable than ever with digital technology” (Keene, 2014, p. 20). Due in part to the tablets and cell phones that are already in consumer’s hands, digital signage is becoming a more cost-effective way to advertise and inform the public (Wilkinson & Kolodzy, 2012, p. 138; “MTA,” 2014; Strauss, 2013). Revenues are up and costs are down, which is a major reason why so many industries are diving into digital signage networks. As Brawn (2014) reported, the majority of digital signage networks that fail, do so not because of technical issues, but rather because of business carelessness (p. 22). How long will digital signage continue to grow? Experts do not mention it reaching the maturity or decline phases. Furthermore, as Marshall McLuhan would ask, is the medium the message? In the 1960s, McLuhan became famous for his theories on the effects of media (Baran & Davis, 2012, p. 229). He was a technological determinist who believed that technology inescapably caused all cultural, political, social, and economic change. As explained in the background and current status sections, digital signage has caused change in all of those areas. He asked, “If communication technology plays such a critical role in the emergence of new social orders and new forms of culture, what are the implications of abandoning print media in favor of electronic media” (p. 231)? This is such a laden, yet important question. Will the proliferation of digital signage cause the end of print media? In essence, McLuhan believed that “technology determines experience”
  11. 11. 11 and the influence of new media is “more important than the content of specific messages” (p. 231). I wonder if people realize how much digital signage influences their daily experiences. McLuhan anticipated a global village, in which “electronic media tied the entire world into one great social, political, and cultural system.” Digital signage is a social, political, and cultural system, and all signs have the potential to be connected through the World Wide Web. McLuhan also predicted media to be an extension of man, meaning that “media literally extend sight, hearing, and touch through time and space” (p. 232). Digital signs can have audio, use touch screens, and have multiple screens within one screen; they are extensions of man’s sight, hearing, and touch. I see digital signage as a perfect example of McLuhan’s theories on technological determinism, the global village, the extension of man, and the medium is the message. If McLuhan predicted this in the 1960s, why can’t scholars make predictions for digital signage’s extended future? Right now, scholars seemed to be focused on the new capabilities that digital signs offer; consequently, research on the effects of digital signage is scarce (Burke, 2009, p. 180). They are making predictions of what the digital signs themselves will be able to do, not the effects they will have on society. Media and communication experts are already concerned about information overload and advertising bombardment. Sorting through the bombardment of information can be frustrating, can slow down productivity, and can shorten one’s attention span (Stanley, 2014, p.13). Will the growth of digital signage be too much for consumers to handle? Consumers like to be informed, not intruded upon. Where is the boundary between those two? Although guidelines are currently in place, additional regulation might be needed to protect people from intrusive technologies like facial recognition and behavioral tracking.
  12. 12. 12 Moreover, will digital signage perpetuate the digital divide and oligopoly? Not everyone will be able to afford to deploy digital signs. Realistically, the digital divide is a communication problem not just in developing countries, but in the U.S. as well (Floyd, 2011, p. 47). Digital signs require a fast Internet connection, and high speed Internet is not available everywhere in the U.S.. According to the Organization for Economic Co-Operation and Development (2012), only 27% of Americans had access to broadband Internet in 2011 (as cited in Lombardi, 2012). Major media companies could create oligopolies and control the majority of digital signs, just like they control most of what people hear on the radio, read in the newspapers and magazines, and watch on TV (Baran & Davis, 2012, p. 51). I can see the advantages that digital signage has created, but I worry that digital signage may become too influential. With rapid proliferation, digital signage could become an illustration of mass society theory. According to Baran & Davis (2012), mass society theory assumes average people to be vulnerable to the influence of media, and the threat that media pose must be dealt with by falling under elite or totalitarian control (pp. 55-56). The vulnerability of people depends on their media literacy, and media literacy varies across people (p. 35). It is easy for me to analyze digital signage content or other forms of media because I am a mass communication student, but not everyone studies media. Also, there are plenty of people in the mass communication field that are more optimistic about digital signage than I am. Katie McCartney, a fellow mass communication student, works for the Social Marketing Team at Frostburg State University, which controls the digital signage network on campus. She said, “I feel like it's a great way to get a lot of information on a limited amount of surface space. The only down side to digital signage is that people could miss information if the screen changes before they are done reading” (K. McCartney, personal communication, May 12, 2014). Digital signage can be useful
  13. 13. 13 and powerful, but can potentially cause negative effects on society and the mass communication field. Conclusion Rising from previous media technologies, digital signage has become a very popular, profitable, and influential media channel (Wilkinson & Kolodzy, 2012). It has a global market worth billions of dollars. It is utilized by numerous industries, for a variety of purposes, and to communicate many different kinds of messages. From giant screens along highways, to modest mobile phone screens, and all sizes in-between, people are getting their information from digital signs. Shoppers, commuters, patients, tourists, and people of all walks of life are experiencing this medium everywhere. Borrowing from McLuhan’s theories, I wonder if digital signage is more harmful than helpful, or vice-versa. Digital signage may be too pervasive and intrusive. Advertisers may be overstepping their boundaries when it comes to reaching consumers. Consumers have the power to determine digital signage’s future, but their determining depends on their media literacy. Effects on the industry and society vary, and the future is unclear. Digital signs are influencing the global economy and the ways in which the world is communicating. The public will have to make decisions about how to consume or how not to consume digital signage.
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