The proliferation of deals both large and small indicates a long-awaited tipping point in the digital signage industry, said Brad Gleeson, president and COO of ActiveLight. In the first of a two-part interview with Digital Signage Update, Gleeson offers an industry veteran’s vantage point on recent developments — as well as the challenge measuring digital signage’s impact in the increasingly diverse industry segments that use it.
Digital Signage Update: Digital signage deals are making big news lately. Is the industry really taking off?
Brad Gleeson: It’s a pretty exciting time. The 3M purchase of Mercury Online Solutions, the Kroger deal, Focus Media’s IPO — there’s global activity taking place with large multinational companies waking up either as participants or investors in digital signage. We’re all hoping it’s the great bow wave that will lubricate a lot of the deals that are on the table. I’m encouraged that the stuff happening now will create more opportunity for everyone and a great deal of attraction to the industry. I am hearing about companies being created, and companies spinning off new names I can’t even keep track of. The industry in general is proliferating, and that’s a good sign because it’s attracting so many startups and seasoned veterans who want to get involved. We’ve been waiting for this for years.
DSU: What’s different about current trends as compared to previous growth spurts?
BG: Signage is proliferating on both large and small levels — but also proliferating horizontally within industry segments. Real estate seems active, financial markets have always been active. We’re going to the Government Video Expo with a digital signage pavilion. I recently got a call from the folks at management consulting firm Bain & Co., who were interested in learning about signage in corporate communications. We don’t get a lot of play and publicity for the corporate digital signage marketplace, so that’s really interesting — the bubble-up of activity that’s happening in some of the less-well-known vertical markets. Health clubs, bars and night clubs are now back on the front burner. I see all these as signs that we’re approaching the tipping point — when signage will be seen not as unique, but as a standard part of business.
DSU: Can signage seriously compete with other advertising media?
BG: Arbitron is proposing a standard to measure out-of-home TV. If digital signage is incorporated, and Arbitron is creating a people-meter, then media planners and buyers can incorporate signage into their planning. It becomes real when it’s a line item on the spreadsheet for media planners. It isn’t there yet but we’re coming close.
DSU: Is measurement the critical challenge?
BG: There are so many conflicting viewpoints. How do you measure digital signage when its goal is to increase sales lift? OK, that’s fairly easy — but what about in the pharmacy, where you’re reducing perceived wait time? There are several business models for digital signage where it’s not easy to calculate ROI. But in every case, it’s not suddenly creating a brand new media, but it’s complementing something that’s already out there or replacing it — such as point-of-purchase displays. There’s an ultimate challenge in figuring out not only measurement, but also, what is the ultimate goal of that digital signage application?
DSU: It does seem like a lot of businesses are forging ahead with signage, despite challenges. Is this a good thing?
BG: We struggle to get customers to say, not “I want digital signage,” but “this is the result I want to achieve with digital signage.” There is a gimmicky part of the business where people are asking for plasmas because others have plasmas and they’re not thinking about what their objectives are. Right now we have this amorphous cloud of applications and opportunities and business models that revolve around this category of digital signage. Eventually they will congeal into multiple segments. Each will have its own way of measuring success. What Arbitron is doing at retail will not be the same as what the TSA is trying to do at airports.