Did you know that 60% of enterprises currently don’t have digital signage in their stores but want to invest in the technology within the next two years?
With that comes an important question: What is the ROI of digital signage?
In other words, is it worth it?
In this guide, explore these different elements:
- A reminder of what digital signage ROI is
- How to calculate ROI for digital signage
- How to measure ROI with best practices
- Tips and tricks for maximizing digital signage ROI effectiveness
- Successful case studies showing tangible results
What is Digital Signage ROI?
Digital signage ROI measures the return on investment generated by implementing digital signage solutions in a business setting. It encompasses the financial benefits gained from increased sales, reduced operational costs, and improved marketing effectiveness resulting from the deployment of digital displays.
Beyond monetary gains, digital signage ROI encompasses non-financial advantages such as enhanced brand visibility, improved customer engagement, and streamlined communication. By using measurement methodology for calculating digital signage ROI, businesses can assess their signage strategies’ effectiveness, identify areas that need improving, and make informed decisions to maximize the overall impact and returns from their investment in digital signage technology.
What Goes into Calculating ROI for Digital Signage
According to a Nielsen study, digital signage can increase brand awareness by up to 47.7% and the average purchase amount by 29.5%. This highlights the significant impact that strategic digital signage deployment can have on driving consumer behavior and boosting business outcomes.
Digital signage ROI is calculated by analyzing:
- The impact of digital signage investments on business objectives and financial performance could increase sales, enhance brand awareness, or improve customer experience.
- The measurement of KPIs like increased sales, foot traffic, dwell times, conversion rates, or even customer engagement on social media platforms.
- The analysis of conversion rates against the costs of implementing and maintaining digital signage solutions.
- The investigation of enhanced brand awareness, improved customer experience, and operational efficiencies
Ultimately, businesses can determine the return on their digital signage investment by comparing the benefits gained from these metrics to the investment they made.
How to Measure ROI in Digital Signage
Measuring the effectiveness of digital signage and ROI is key for businesses to understand the impact of their signage. Let’s explore actionable insights commonly used to measure digital signage ROI:
First, calculate the costs of implementing digital signage
It is crucial to calculate the costs of implementing digital signage. Have a look below at what to expect:
- Hardware Costs:
- Digital displays/screens: $200 to $2000
- Media players (if not integrated into screens): $50 to $500
- Mounting hardware and installation materials: $20 to $100
- Software Costs:
- Digital signage software subscription fees: $20 to $30
- Content management system (CMS) fees, if separate: $50 to $500
- Content Creation Costs:
- Graphic design and multimedia production: $150 to $250
- Professional content creation services, if outsourced: $20 to $200
- Installation Costs:
- Professional installation services: $50 to $100
- Electrical work and connectivity enhancements: Upwards of $100
- Maintenance and Operational Costs:
- Software updates and license renewals: Often included in subscription fees
- Hardware maintenance and repairs: $100 to $220 an hour
- System checkup costs: $60 to $500
Total estimated cost on average: $2630
Read next: How Much Does Digital Signage Cost (A Breakdown)
Choose the Measurement Methodology(ies)
Selecting the right method to measure your digital signage campaign’s success is crucial.
- Qualitative Research: Use surveys and interviews to understand how customers engage with your digital signage.
- Customer Feedback on Engagement: Collect data on how engaging customers find the digital signage. For instance, asking customers if the digital signage caught their attention and if it influenced their perception of the brand.
- Content Recall: Measure how well customers remember the content displayed. This can involve asking customers about specific promotions or messages featured on the digital signage and seeing how much they recall.
- Quantitative Analysis: Use analytics to track which content elements are most and least effective.
- Sales Conversion Rates: Track changes in sales figures before and after implementing digital signage to see a direct impact on revenue. Note the date when you started digital signage and track it periodically – like every two weeks.
- Engagement Rates: Track the number of interactions with the digital signage, such as touch screen inputs, QR code scans, or website visits that originated from the signage.
- Time Spent: Analyze the amount of time customers spend interacting with or viewing the digital signage. This can be measured through motion sensors or camera analytics.
- Observational Studies: Conduct focus groups to gain a deeper understanding of customer behavior in the presence of your digital signage.
- Customer Dwell Time: Use sensors or video analytics to determine if digital signage increases the time customers spend in a specific area.
- Behavioral Changes: Observe any changes in customer behavior in the vicinity of the digital signage. For example, noting whether more customers stop to look at products featured on the digital signage.
- Group Dynamics: Monitor how groups of customers interact with the digital signage differently than individuals. This could involve noting if groups are more likely to engage with interactive content.
- Employee Feedback: If digital signage is used for internal communication, gauge employee engagement and satisfaction as an indirect measure of ROI. Or if it’s used in-store, your employees are first-hand eyewitnesses to customer behavior around digital signage.
Social Media Engagement: Monitor increases in social media mentions, followers, or engagement that can be attributed to your digital signage content. How can you attribute this to your digital signage campaign?
- Use Specific Hashtags: Create unique hashtags related to the digital signage content and encourage viewers to use them when posting on social media. Monitoring these hashtags can directly link social media activity back to the signage.
- Track QR Code Interactions: Integrate QR codes into your digital signage that leads to social media pages or specific posts. The analytics from these QR codes can show how much traffic and engagement were generated directly from the signage.
- Conduct Time-Based Analysis: Compare social media metrics before and after the deployment of digital signage. While not entirely foolproof, significant increases in engagement during or immediately after the display period can suggest a correlation.
Don’t forget to consider cost savings
Leveraging digital signage can lead to substantial cost savings, a significant advantage often overlooked. The shift from traditional to digital comes with several financial benefits:
- Reduction in Print Costs: Digital signage minimizes the need for printed materials like flyers, posters, and banners, leading to direct savings in printing and materials costs.
- Elimination of Distribution Expenses: With digital signage, there’s no need to distribute physical advertising materials, cutting out logistics and distribution costs.
- Decreased Waste: Digital signage is environmentally friendly, reducing the amount of waste generated from outdated printed ads.
- Dynamic Content Updates: The ability to quickly and easily update digital signage:
- Ensures marketing strategies remain responsive to market trends without incurring additional costs.
- Avoids the expenses associated with reprinting and redistributing updated materials.
Pro tip: Continuously monitor the performance of your digital signage strategy and be prepared to make adjustments based on real-time data and feedback. It’s also best to remain responsive to changing market trends and customer preferences to maintain relevance and maximize ROI.
ROI vs. ROO
When evaluating the success of digital signage and other marketing investments, it’s crucial to distinguish between Return on Investment (ROI) and Return on Objectives (ROO). Both metrics offer valuable insights, but they measure success in different ways.
Return on Investment (ROI)
- Financial Metric: ROI quantifies the financial return on a particular investment compared to its cost. It’s expressed as a percentage or ratio, providing a clear picture of profitability.
- Calculation: ROI is typically calculated by dividing the net profit of the investment by its initial cost. The formula is: ROI = Net Profit / Cost of Investment × 100.
- Purpose: ROI is used to assess the direct financial benefits of an investment, making it easier to compare the efficiency of different expenditures.
Return on Objectives (ROO)
- Qualitative Metric: ROO measures how well an investment achieves specific, predetermined objectives. These objectives can include increasing brand awareness, improving customer satisfaction, or enhancing employee engagement.
- Assessment: Unlike ROI, ROO is not always quantifiable in financial terms. It involves evaluating the success of a project based on its contribution to strategic goals and objectives.
- Purpose: ROO is particularly useful in contexts where the benefits of an investment are not immediately reflected in financial terms but are critical to long-term success and brand development.
Key Points:
- Complementarity: ROI and ROO should be considered complementary metrics. While ROI focuses on financial returns, ROO emphasizes the achievement of strategic goals that might lead to indirect financial benefits in the long run.
- Application: For digital signage, ROI might measure increases in sales or cost savings, whereas ROO could evaluate improvements in customer engagement or brand visibility.
- Strategic Planning: Incorporating both ROI and ROO in decision-making processes ensures a balanced approach, recognizing both the financial and strategic value of investments.
How to Maximize Digital Signage ROI (Tips and Tricks)
Now that we’ve laid the groundwork—and then some—for understanding digital signage ROI, it’s time to explore best practices for maximizing it.
Whether you’re a seasoned retailer or just dipping your toes into the expansive world of digital signage, these expert tips that CrownTV itself uses will help you unlock the full potential of your digital signage investment.
1. Content is King: Crafting Compelling Messages
The success of your digital signage strategy hinges on the quality of your content. Every element, from attention-grabbing visuals to persuasive calls to action, plays a crucial role in capturing and retaining audience attention.
So, keep your messaging concise, relevant, and with actionable insights to drive engagement and compel customers to take action and purchase your products or services. Here’s a look at how this could look:
- Promotions and Offers:
- Engaging: Use eye-catching visuals and animations to highlight limited-time offers or discounts.
- Concise: Display clear and concise messages, such as “Buy One, Get One Free” or “50% Off Today Only.”
- Relevant: Tailor promotions to current trends or seasons, like “Summer Sale” or “Back-to-School Deals.”
- Actionable: Include a clear call-to-action (CTA) like “Shop Now” or “Scan QR Code for Discount.”
- Product Highlights and Demos:
- Engaging: Showcase product videos or demos that demonstrate features or benefits.
- Concise: Focus on key selling points or unique features in a brief format.
- Relevant: Highlight products based on seasonality, popularity, or customer preferences.
- Actionable: Encourage viewers to “Learn More” or “Try In-Store Today.”
- Customer Testimonials and Reviews:
- Engaging: Share authentic customer testimonials or reviews with compelling visuals.
- Concise: Highlight short and impactful quotes that resonate with potential customers.
- Relevant: Feature testimonials related to the displayed products or services.
- Actionable: Prompt viewers to “Read More Reviews Online” or “Share Your Experience.”
2. Strategically place your digital signage to maximize impact
Location, location, location—it’s not just a mantra for real estate; it applies to digital signage too. Strategic placement ensures your signage captures consumer attention while delivering what your target audience wants to see. To strategically place signage, follow these tips:
- Identify High-Traffic Areas: Place signage where most people will see it, such as entrances, waiting areas, or main walkways.
- Optimize Points of Purchase: Situate digital signs near checkout lines or product displays to influence last-minute buying decisions.
- Leverage Key Touchpoints: Consider areas where customers pause or engage more deeply, such as product information kiosks or seating areas.
- Ensure Visibility: Make sure the signage is placed at eye level and in well-lit areas to maximize visibility.
- Study Customer Flow: Observe how customers move through your space and place signage along these paths to ensure maximum exposure.
3. Interactivity: Engaging Your Audience
Interactive digital signage goes beyond passive advertising—it invites customers to actively engage with your brand.
Whether it’s touchscreen displays, interactive kiosks, or mobile integration, incorporating interactive elements into your signage strategy fosters deeper engagement, encourages exploration, and provides valuable entry points for customer personalization. Here’s how to do this:
- Touchscreen Surveys:
- Allow customers to provide feedback or answer questions directly on the screen.
- Offer incentives like discounts for participation to encourage engagement.
- Use collected data to personalize future marketing efforts.
- Interactive Games or Quizzes:
- Create fun and educational games related to your brand or products.
- Offer prizes or discounts for high scores or completion.
- Encourage social sharing for additional reach and engagement.
- Augmented Reality Experiences:
- Implement AR features that allow customers to virtually try products or visualize them in their space.
- Enhance the shopping experience by offering interactive product demos.
- Drive excitement and interest by showcasing innovative technology and features.
4. Data-Driven Optimization: Continuous Improvement
Data is your secret weapon in the quest for digital signage ROI. That’s why you need to leverage analytics tools like CrownTV’s to track performance metrics, analyze customer behavior, and measure the overall effectiveness of your signage initiatives.
To maximize the effectiveness of your digital signage using data-driven optimization, follow these tips:
- Define Key Metrics: Establish specific goals for engagement and sales related to your signage and measure against them.
- Utilize Real-Time Analytics: Use tools like CrownTV’s dashboard to monitor and quickly adjust your strategies based on performance data.
- Tailor Content to Viewer Demographics: Customize your messages based on the age, gender, and preferences of your audience to increase relevance and impact.
- Experiment with Content Placement: Test different locations and content formats to find the most effective setup that maximizes viewer engagement.
- Schedule Strategically: Align content timing with audience traffic patterns to ensure maximum visibility and impact.
- Incorporate Feedback: Combine analytics with direct viewer feedback to refine and enhance your signage content continuously.
Any insights obtained during the data-gathering stages can be used to refine your content, adjust placement strategies, and optimize your overall signage strategy for the best results. Here is an example of how CrownTV Analytics can help your business:
- Comprehensive dashboard for real-time monitoring and performance tracking.
- Measures engagement, content popularity, and viewer demographics.
- Provides insights to optimize content and placement strategies.
5. Seamless Integration: Enhancing the Customer Journey
Digital signage shouldn’t exist in a vacuum—it should seamlessly integrate into the customer journey, enhancing the overall shopping experience.
From wayfinding to product recommendations, you must use signage to guide customers through their journey, provide valuable information, and create memorable interactions that drive customer satisfaction, loyalty, and repeat business.
Here are a few examples of how digital signage can be used to guide consumer decisions:
- Product Information Displays:
- Showcase detailed product specifications, features, and benefits.
- Highlight user reviews, ratings, and testimonials to build trust.
- Display comparison charts to help consumers make informed choices between products.
- Interactive Wayfinding and Maps:
- Provide interactive maps and directions to guide customers through large stores or venues.
- Highlight promotions or featured products along the way to influence purchasing decisions.
- Offer personalized recommendations based on customer preferences or browsing history.
- Dynamic Menu Boards:
- Display enticing food images and descriptions to stimulate appetite.
- Highlight daily specials, promotions, or combo deals to encourage upselling.
- Update in real-time to showcase availability or sold-out items, guiding choices based on current inventory.
- Real-Time Social Proof:
- Showcase live feeds of social media mentions or user-generated content related to products or services.
- Highlight trending or popular items to create a sense of urgency and influence purchasing decisions.
- Encourage sharing and engagement by displaying hashtags or social media prompts.
Real-Life Success Stories of Positive ROI on Digital Signage
Want proof that digital signage delivers tangible results? Look no further than real-life success stories from CrownTV. Look below to learn how CrownTV has created digital signage systems and digital signage campaigns alongside optimizing business strategy to increase customer engagement and business success.
Case Study: L’Occitane en Provence
L’Occitane en Provence, a leader in luxury body, face, and hair products, aimed to enhance the in-store experience across its 150 locations in the US and Canada. However, the company’s existing digital signage system suffered from technical and reliability issues.
Challenges:
- Malfunctioning screens
- A high volume of support tickets
- Missed marketing opportunities due to inactive screens
Solution: CrownTV, a top digital signage provider, conducted thorough surveys and deployed customized solutions across all stores. Despite network complexities, CrownTV ensured smooth installations, addressing security concerns comprehensively.
Key Details:
- Versatile configurations, from video walls to singular displays
- Tailored playlists for targeted messaging
- Intuitive dashboard for efficient content management
Outcomes:
- Enhanced in-store experience with captivating displays
- Improved customer engagement and communication of brand values
- Hassle-free partnership with CrownTV handling technical support and maintenance
CrownTV’s digital signage solution significantly improved L’Occitane’s in-store experience, demonstrating the transformative power of innovative technology in retail. With its success, CrownTV’s partnership with L’Occitane expanded to European brand stores.
Case Study: Invicta Stores
Invicta Stores, the official retailer for Invicta Watch Group and other luxury brands, sought to elevate its retail experience across its 50+ locations in the US and internationally. Dissatisfied with DIY digital signage solutions, they turned to CrownTV for a comprehensive solution.
Challenges:
- Inefficient DIY solutions using DVDs
- Need for easy deployment and control across all locations
- Desire to attract and engage customers effectively
Solution: CrownTV provided Invicta with an all-inclusive digital signage solution featuring easy deployment, customizable capabilities, and centralized control. CrownTV’s hardware ensured reliability and scalability, while its cloud-based dashboard facilitated content management and real-time monitoring.
Key Details:
- Streamlined communication and campaign rollouts
- Quick deployment of players to each location
- Dynamic content management tailored to store locations and screens
Outcomes:
- Enhanced customer experience with dynamic and modern displays
- Increased product visibility and sales through effective promotion
- Efficient content management and real-time monitoring capabilities
CrownTV’s digital signage solution significantly improved Invicta’s retail experience, providing them with dynamic and efficient branding control. By embracing professional digital solutions, Invicta stood out in the competitive retail landscape, demonstrating the power of digital signage in modern retail stores.
Ready to enhance your retail experience? Request a demo of CrownTV’s digital signage solution today.
ROI-Driven Digital Signage Statistics
It’s always worth seeing tangible results before committing to an investment and the same goes for digital signage ROI. So, to help you learn more about how investing in digital signage for your business is the right move, we’ve listed a few key digital signage statistics you should know below:
- Market Growth: The global digital signage market reached $23.5 billion in 2021 and is projected to grow at a CAGR of 6.3% between 2022 and 2031, reaching $63.3 billion by 2031.
- Audience Reach: Digital signage reaches an impressive 135 million people worldwide every week, making it a powerful medium for Digital signage adoption communication and advertising.
- Regional Market Dominance: According to a study by Astute Analytica, North America is the largest market for digital signage and is expected to maintain its dominance with other European and Asia-Pacific countries following suit.
- Cost Efficiency: As technology evolves, the cost of installing digital signage is decreasing. Between 2004 and 2010, the cost of deploying a hundred-node digital signage network decreased by 50%, making it more accessible for businesses.
- Content Importance: End-users plan to invest more in acquiring new displays (65%) and content production (42%), emphasizing the importance of high-quality content in maximizing the effectiveness of digital signage.
These statistics underline the growing market, widespread adoption, and high ROI potential of digital signage, making it a compelling investment for businesses across various industries.
Start Seeing Serious Digital Signage ROI with CrownTV
The increasing adoption of digital signage solutions underscores their importance in modern business environments. Use the guide to maximize the benefits of digital signage for your business.
Key takeaways
- Growing Market & Adoption: The global digital signage market is set to reach $63.3 billion by 2031, with 60% of enterprises planning to invest within two years.
- Strategic ROI Measurement: Effective ROI calculation involves analyzing key performance indicators KPIs like sales conversion rates and engagement metrics.
- Enhanced Customer Engagement: Digital signage boosts customer experience and brand visibility, driving increased sales and loyalty.
- Cost Efficiency & Content Importance: Digital signage reduces costs and waste while emphasizing the importance of quality, compelling content.
- Balanced Approach with ROI vs. ROO: Recognizing both financial ROI and qualitative ROO ensures a comprehensive strategy for success.
At CrownTV we keep the above in mind and provide comprehensive solutions that are pivotal in elevating storefront experiences and driving unparalleled ROI. So, are you ready to transform your business? Unlock the full potential of digital signage with CrownTV today, and let our team help you get to the forefront of your industry.