| In the world of solution selling,
there aren’t any no-brainers, but digital signage comes close.
"I think that for a VAR with a web development or software development
staff, digital signage is a natural," says Lynn Hudgens, owner of
Turning Point Solutions, a managed services provider. "It's a solution
that's doing the same thing as a web site -- presenting information to
the public. You have to have a good reason not to do it."
Mike White, owner of A/V integrator Multi-Media Solutions, agrees. "Digital
signage is one of the last few bastions where you can still make money,"
he says.
Scoping Out the Market
Industry researchers report that digital signage is starting to take off.
One firm predicts that the number of digital displays will rise from 433,000
in 2005 to 900,000 in 2009. "Digital signage is going to become a
ubiquitous form of advertising and information delivery," says Irene
Chow, Ingram Micro's senior category manager for digital signage and digital
home.
Helping to drive the market are the declining prices on systems. Prices
for flat-panel displays, for instance, are falling headfirst. The technology's
effectiveness in attracting the attention of customers, employees and
others also plays a part. The dynamic visuals (and audio) make this a
more compelling medium than static, conventional media like print and
billboards.
And familiarity is convincing business owners that the medium is worth
considering. Seeing a digital sign was a rarity just a couple of years
ago, but that's no longer true. As business owners and managers see this
technology in action and appreciate its power to communicate, they are
open to using it themselves.
This familiarity is resulting in shorter selling cycles for many solution
providers. "In the past it was taking nine months to sell digital
signage," says Dave Sallander, owner of systems integrator Sherlock
Systems. "Now we're seeing so much more activity and more understanding
by customers that the selling cycle is closer to 30 to 45 days."
Hudgens of Turning Point reports that the sales cycle is down to 90 days
if he contacts the customer and has to demo the system; 30 days if the
customer comes to him.
Defining the Solution
Ronald I. Gross, CEO of Dynatek Media Corp., a firm specializing in digital
signage, defines digital signage as the application of placing flat-screen
displays in any public environment outside of the home, where the content
can be manipulated by time of day, demographics, location or other outside
variables. A slightly different take comes from Sallander. He says digital
signage is the ability to move digital information over an IP network,
display the media and manage the content remotely.
Digital signage systems can include plasma and LCD panels, video walls,
projection systems, audio systems, networks, cables, PCs, media players,
screen mounts, and servers and software to run, schedule, create and distribute
the content. And then there are services, including installation, tech
support, break/fix, security, network management and content creation.
These displays are being placed in (and on) retail stores, casinos, hospitals,
schools and universities, office buildings, corporate environments, museums,
sports arenas, airports, movie theaters and trade shows.
Phil Ferranti, CEO of The Technology Company, a home and office solution
provider, has sold systems to colleges, retail stores, restaurants and
a manufacturing plant with several buildings. He also sells a product
to sports bars that promotes food and drink while allowing a game and
banner advertising to run at the same time.
Why Add Digital Signage?
Digital signage can be used to communicate with a company or organization's
employees, customers and visitors. As such, it is a natural add-on sale
to many existing customers. "It's an easy sell," says Hudgens
of Turning Point. "It can be used wherever people are standing in
line or passing by at a viewable speed."
In addition, it is a sale that typically creates an ongoing customer
relationship -- and a steady stream of income. "Digital signage is
not just a hardware and software play or a one-shot deal," says Chow
of Ingram Micro. "It's a recurring income opportunity."
Glenn Polly, president of systems integrator VideoSonic Systems, notes
that although digital signage results in hardware sales, the real profit
opportunities lie in services. He has graphic artists on staff who create
content for customers' signage, and this is very profitable. "Customers
know what a 42-inch plasma screen costs. But when we throw in a graphic
artist, we can make more money," he says. His gross margins on digital
signage projects can be 40 percent to 50 percent, depending on how many
services are provided.
| Digital Signage Selling
Tips |
Digital signage selling is done is primarily to marketing departments.
IT has to be involved (usually it's their network), but this is
a marketing tool and marketing must be behind it. Because digital
signage can save and make money, return on investment is a favorite
selling point.
Ronald I. Gross, CEO of Dynatek Media Corp, has agreements with
convenience and drug stores to sell advertising on their digital
signage system and share the income. He estimates that the average
installation and management of the network for a year is about $8,000
per store, and generates about $1,000 a month for the store. "Probably
within a 12- month period of time, a client could get its cost returned,"
he says.
When approaching restaurants, Phil Ferranti of The Technology Company
talks about how the technology can enhance sales. "You can
increase beer sales and appetizer sales, which provides an ROI,"
he tells potential buyers. Here are some additional selling points:
- Cost-Effectiveness: Printed signs have a lifespan that's usually
pretty short. If a customer is now printing signs frequently,
digital signage will eliminate those costs.
- Consistency: Each sign in a building can have the same look
and even the same message.
- Convenience: Signs can be changed instantly, and from one central
location. Unlike printed signs, mistakes are fixed quickly.
- Flexibility: "You can watch how your audience reacts to
your signs, and you can react to your audience," notes Lynn
Hudgens of Turning Point Solutions. "With billboards and
printed signs, once you do it, you've bought it."
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What You Need to Know
Though there are no standards yet, digital signage technology has improved,
and the pieces are working better together. This puts signage within reach
of most solution providers.
"Before, we sent spreadsheets and Word documents over the network,"
says Sallander of Sherlock Systems. "Now we send JPEGs, flash files,
MP3 files, Windows Media files. Almost any digital content can be sent
over an IP network. We're building on what we already know."
Chow, of Ingram Micro, notes three things that VARs need to know to be
successful with digital signage:
- Video (the display) and perhaps audio technology
- How to manage the video remotely from a network (this includes being
able to change the message and monitor it to make sure the sign is working)
- The software that manages the content
If you'd like to learn more, Ingram Micro's digital signage practice
group has put together a variety of solutions with pieces it has tested
and knows are compatible. It also has a dedicated digital signage tech
support desk that not only provides tech support after a sale, but pre-sales
support as well, including technicians who will go into the field to help
close a sale. For details, Ingram Micro's customers can call Ingram Micro
sales at (800) 456-8000, Ingram Micro's Digital Signage Help Desk at (800)
445-5066, ext. 76355, or visit www.ingrammicro.com
and, after signing in, access the digital signage portion of the web site. |
