With a longer-than-average dwell time, banks typically need higher-quality, timelier content than other venues.
2. Role of the venue
The nature of the venue will have a significant impact on the revenue-generating capabilities of a DOOH network. Understanding how consumers interact within a given environment will help determine the best combination of content and ads.
In an airport, for example, passengers have considerable dwell time near departure gates and in baggage claim zones. An airport’s DOOH network can therefore run more content with longer commercials, much like broadcast TV. Conversely, in a public transit station where riders only have a 10- to 15-second viewing opportunity, displaying a 30-second TV spot will fragment the message and lessen its impact.
Another consideration is sound. Compared to an airport lounge where sound is considered essential for digital signage, transit stations are noisy, so audio content may not be necessary or even viable.
‘Visually busy’ environments are similar to noisy ones, as they detract from the screen viewing opportunity, necessitating shorter, more focused messages and/or larger displays to break through to the audience.
In cinemas, many advertisers run customized commercials that are longer than those on TV, as there is a better opportunity to have an impact on a captive audience. The combination of large numbers of consumers in a captive situation with long dwell times is usually a strong formula for success.
Digital signage also needs to fit into the environment esthetically, but be visible enough to deliver results. Ideally, screens should be located where consumers congregate or pass. For ‘dwell environments,’ where consumers can sit, watch and listen with minimal interruptions, screens need to be large enough for exposure to multiple viewers, but not overwhelming.
In ‘transient environments,’ viewing opportunities are shorter, which usually necessitates larger signage and shorter—but more visually impactful—ads.
Most retail DOOH networks are in ‘transactional environments,’ where there is significant dwell time for consumers, but not in one location. Rather, as a store’s customers move around during the course of their visit, they are exposed to multiple screens and, potentially, multiple messages from the same advertiser. Shorter spots with higher frequency will be more effective in this context than longer spots with lower frequency.
Access to product sales data in retail environments is vital for demonstrating the effectiveness that advertising on the network has on influencing sales. This data and other research unique to the venue, including traffic flow and customer profile information, can be used in marketing support efforts.
The landlord is often a key stakeholder and/or influencer in many DOOH networks and it is critically important to establish a clearly defined agreement to ensure protection for the network operator, especially with regard to advertising exclusivity and payment thresholds. Working closely with the landlord will help prevent deployment-related and operational challenges.
In the negotiation stage, most landlords tend to overvalue their real estate. It is common for them to request guaranteed revenue streams and/or a percentage of sales revenue. Building flexibility into the financial model early on could be the determining factor between the network’s success and failure, as most DOOH networks involve significant upfront capital and high operational costs. Revenue often falls short during the startup phase, so a conservative approach to sales early on is recommended.
The revenue model should establish three thresholds, i.e. for low, mid-range and high revenue expectations, which all parties need to agree to in advance. Many DOOH networks that have failed did so because their operators committed to unrealistic revenue projections.
Once the network is up and running, content and ad approval issues will constantly need to be addressed, as the creative approval process can be challenging and time-consuming, which could affect revenues negatively.
Digital billboards typically run a loop of eight-second static ads, with six to eight advertisers represented within each loop.
3. Using content effectively
The digital signage industry has focused heavily on content as the key element to maintain audience interest—i.e. ‘content is king’—but this is not completely accurate. The other key variable that is often overlooked is the length of the viewing opportunity (i.e. dwell time). As the viewing opportunity increases, goes the simple rule of thumb, so too does the importance of content.
Digital billboards, for example, offer a very short viewing opportunity and little or no content. They typically run a loop of eight-second static ads, with six to eight advertisers represented within each loop. One example of suitable content would be a news organization downloading headlines throughout the day, reinforcing its core business.
As dwell time increases, so too does the length of the exposure opportunity. Most sports venues, medical offices, airports and banks need more venue-specific and timely content. In an airport, by way of example, business travellers typically dwell for at least 40 to 45 minutes, so the DOOH loops tend to last 30 to 45 minutes, featuring plenty of 15- or 30-second commercials with sound and longer content pieces like business reports and full newscasts. The focus should always be on developing effective communications with the audience by capturing attention and interest.
Networks hosting broadcast-quality content require significant bandwidth and dedicated wiring, making them inherently less flexible than other digital signs in terms of content and ad delivery. Conversely, networks using Flash-based spots require relatively small files that are simpler to create and can be transmitted through hardwired or cellular phone links. Individual screens in these networks can be set up with their own Internet Protocol (IP) addresses, providing almost unlimited flexibility for content and ad delivery.
Most DOOH networks use landscape mode, especially in retail stores, where screens are often suspended from the ceiling.
It is important to determine which of these types of network setup is best for a project at the planning phase. This should involve a thoughtful review of the key communication objectives and the operational costs associated with the network.
Another factor affecting content is whether the screens will be installed in landscape or portrait orientation. The vast majority of DOOH network operators have chosen the landscape mode, especially for retail venues where screens are often suspended from the ceiling at a convenient viewing height. The portrait format has also proved popular, however, for mall, transit and other pedestrian-facing applications where suspension may not be practical and floor space is at a premium.
All of these factors play an important role in determining the right presentation and mix of content for a DOOH network. If the mix is wrong, then revenue projections could be compromised for the long term.
