The global digital signage market will grow to nearly $14 billion by year-end with the addition of data-centric information and analytics driving up revenue, according to a new report on the subject from IHS Inc. (NYSE: IHS).
Worldwide revenue for digital signage equipment, software, services and media is projected to hit $13.9 billion at the close of 2013, up a solid 5.6 percent from $13.2 billion last year. This year’s growth improves on the 3.9 percent expansion of 2012, and the next few years will see a continued steady increase in revenue ranging from 4.7 to 5.6 percent. By 2017, total digital signage takings will amount to $17.1 billion, as shown in the attached figure.
“Improvements in technology offerings, data management and infrastructure expansion will help the digital signage industry to continue the positive momentum it has already generated,” said Sanju Khatri, director for signage and public information displays at IHS. “And as digital signage becomes increasingly intelligent with smart content and dynamic interfaces, the integration of real-time data management into real-world applications will further stimulate revenue growth.”
In particular, the integration of real-time data and predictive analytics into digital signage is making a big splash among retailers, which are using digital signage solutions to target customers more efficiently, leading to increased dwell time, improved shopping experiences and a rise in sales.
Many fast-food restaurants—also known as Quick Service Restaurants (QSR) in the industry—are employing digital signage, for instance, to replace static signs with digital menu boards. The boards promote better customer engagement than static signs, while offering dynamic content and appealing visuals. Moreover, digital menu boards provide companies an opportunity to sell smarter by promoting new items, upselling higher-margin products and reducing inventory by making immediate changes to content for promotions or advertising, Khatri noted.
Characterized by fast-food cuisine and minimal table service, QSRs have also begun to utilize displays for point-of-sale (POS) data integration, with North America and Western Europe as the primary regions demonstrating this expansion. Live data feeds allow managers to conduct automated interactions that review real-time sales data and make adjustments locally to manipulate in-store marketing messages to affect the customer’s purchasing decisions and ultimately benefit sales figures, according to Kelly Lum, digital signage analyst for IHS.
Other applications employing live data feeds include corporations using digital signage networks throughout their organizations to improve efficiency in the workplace, increase the company’s bottom line, promote brand awareness and unity, display performance indicators and allow for easier connectivity across large organizations.
Digital signage has likewise become increasingly prevalent throughout many universities to show upcoming event details, as well as display building directories, way-finding maps and emergency messages to increase student and faculty safety.
Additional examples of live data feeds for digital signage displays include news updates, weather, traffic highlights, stock-quote feeds or local event material. Similarly, live data feeds can be useful in programming networked content management software to provide real-time information on a broad range of material, including sales data, emergency notifications, public-transit schedules and service warnings.
Overall, the retail market continues to be the strongest source of revenue for the digital signage industry, with plenty of stores using digital signage systems to promote brands or merchandise, while also being able to simultaneously entertain or educate customers.
The retail sector will make up approximately 42 percent of total digital signage displays revenue from 2013 to 2017, IHS predicts, with North America and Western Europe as the leading retail markets for digital signage. Meanwhile, digital signage revenue from China, Japan, the rest of Asia-Pacific and Latin America is forecast to increase by about 5 percent each year beginning in 2015.