Digital Signage Market Rapidly Expands
With a current market of over US$800 million dollars digital signage has proven its effectiveness as a marketing channel. It is also one of the fastest growing marketing channels, with a projected market for digital signage worth US$3.5 billion by yeah 2011. In fact, over 430,000 digital displays were sold in 2005 alone, with the sole purpose of being used for digital signage displays. A recent report on digital signage sales shows that signage providers are selling anywhere from one display per site to as many as 50 displays per site. They also reported an average sale of four digital displays per site.
The market leaders in digital signage manufacturing are NEC Display Solutions, Sony, LG Electronics, Samsung Electronics, Sony, Mitsubishi, and Sharp, followed by about 50 others who have overcrowded the signage market. These retailers are historically transaction based providers, and thus, are challenged by the fact that this fast growing market is more of a solution based sale. We predict that over the course of 2006, the successful providers will be the ones that have digital signage industry expertise, as well as some installation experience.
Companies that are in the market for a digital signage solution are faced with debate on whether to contract the work to a retailer, or a VAR. The current digital signage market is dominated by retailers. According to a Gartner Group study, 28% of IT retailers in North America are providing flat panel displays for digital signage this year. The group expects that number to increase to 33% in 2007.
Solution providers "are graduating beyond the display," said Doug Albregts, VP of sales and marketing for NEC Display Solutions, based in Itasca, Ill. Doug said that solution providers are discovering that they need to talk beyond the digital signage panel itself and provide wireless cable, mounts and software to deliver a complete signage solution rather than just a product.
"Customers have a keen interest in digital signage and public information display solutions," Albregts said.
However, NEC is only dealing with 40 partners, which it helps to facilitate customer solutions. Albregts said the company could do more with relatively little effort because the signage market is in a growth phase. Display Search estimates that the digital signage market will have a need for more than 900,000 displays by 2009, which trends in line with the Gartner report.
A recent digital signage study conducted by InfoTrends shows that the channel and its applications work. The study, which polled consumers, found that digital signage displays have a 47.7% effectiveness on brand awareness, increase the average purchase amount by 29.5%, create a 31.8% upswing in overall sales volumes, generate a 32.8% growth in repeat buyers and generate 32.8% more in-store traffic.
Now those figures you just can't argue with. Just like digitalsignageresource.com, these three studies maintain that the digital signage market is growing at an accelerated pace, with no signs of slowing down any time soon.
