Whew, what a relief. Here I thought we'd be shutting off the lights and hanging an "out of business" sign in the window, but InfoTrends has run the numbers and concluded that we won't have to! Specifically,
After struggling in the early years of its development, the business of networked digital displays in retail and other public spaces is now on the path to sustainable growth, according to InfoTrends market research. At the end of 2006, the narrowcasting industry was valued at $1.1 billion with an installed base of 630,000 screens at 97,000 sites. This marks a CAGR of 56 percent as compared with the 2004 statistics....I do agree that more retailers and marketers are starting to understand the potential that these systems have to offer, I also think that a big part of the growth right now is that more are finally figuring out exactly how to determine the ROI on their digital signage networks. By knowing just what to measure, they're having an easier time getting some results, and making optimizations when necessary.
InfoTrends expects overall CAGRs of 18.5% for revenues, 8.9% for sites, and 11.9% for screens between 2006 and 2011. By 2011, total revenues are expected to reach $2.59 billion. Key findings of the study include:
- The typical survey respondent is using five different types of media, and printed signage and outdoor signs are still the most common.
- Systems integrators are correct in identifying digital signage for advertising, promotion, and out-of-home applications as a key growth area. They should intensify their efforts to increase their exposure for involvement in applications of this type.
- Compared with the survey conducted in 2004, respondents in this most recent study were much less concerned about issues such as lack of measurement of ad program effectiveness, as the body of data supporting the effectiveness of narrowcasting systems continues to grow.
- Indicative of a high level of satisfaction, of the 51 current users of networked digital displays or in-store TV who responded to our structured survey, not a single one expected their usage over the next three years to decrease, and 80% expected it to increase.
- Retailers and brand managers want their promotional programs of any type to deliver sales lift and increase traffic, and they are becoming more confident that narrowcasting systems can deliver on that goal. Securing repeat customers is their secondary goal, while attaining ad revenues from such systems is considered relatively unimportant.
Tags: digital signage, narrowcasting, retail media