Digital signage is a form of mass communication that combines hardware and software. They are then used to create a centrally-controlled content distribution platform which broadcasts messages to one or multiple screens for informational or advertising purposes.

The messages being broadcast include news, event listings, weather, images, videos, announcements, flight info, menus, ads and more.

The difference between digital signage, electronic signs and a TV displaying images and videos from a USB stick is simple – digital signage includes content management software. The software allows businesses to add and edit many types of content e.g. weather, scrolling text, KPIs. It also allows businesses to “schedule” content i.e. to create a schedule for what content is displayed at what times and for how long. The software also allows businesses to remotely manage the signage. 

Common Uses and Applications

The main goal of digital signage is to help businesses communicate better with their audiences, whether that’s customers, employees, patients, students, etc. 

For this reason, digital signage can be used in almost any industry or setting. 

what is digital signage

A comprehensive report on the digital signage market forecasts that the industry capitalization will grow to 29.6 billion USD by 2024, up from 20.8 billion USD in 2019. The high growth rate can be attributed to the increasing adoption of digital signage across different industries including:

  • In restaurants to display menu boards and specials.
  • In corporate offices and manufacturing for company announcements, employee training, room bookings, KPI reporting, HR & OSHA information, and emergency alerts.
  • In K-12 schools and college campuses to display announcements, a list of events, wayfinding, room bookings, emergency alerts, and displaying lunch menus.
  • In hospitals and doctor’s offices to display healthcare services offered, to manage perceived wait times in waiting areas, show patient testimonials, improve wayfinding, educate patients and visitors, and train hospital staff.
  • In government offices and facilities to educate the public about government services, train employees, for interdepartmental communication, real-time alerts in case of emergencies, to display court dockets, and to show appointments and meeting schedules.
  • In banking for queue management, displaying financial data, powering interactive self-help kiosks, and improving in-branch customer experience.
  • In retail for branding, to showcase new or hot products, promote sales, and enhance the in-store customer experience
  • In hospitality businesses to welcome, direct, guide, entertain, serve, inform and protect guests.
  • In entertainment venues to answer FAQs, display concessions menu boards, wayfinding, event schedules, ticket prices, special offers, and to reinforce safety.
  • In the transportation industry to show transit options and schedules e.g. for buses, trains, Uber/Lyft, bikes, etc., and location-based advertisement.
  • In real estate to showcase property listings and virtual home tours, display neighborhood profiles, and highlight realtors and their successes. 
  • In fitness centers to display a schedule of classes, share member experiences, showcase training tips and tricks and run advertisements.

The Benefits of Digital Signage

Digital signage holds a wealth of benefits regardless of the industry and use case. 

Effective communication is the primary goal of digital signage; however, the rewards of implementing this technology are unlimited. 

Some common benefits of digital signage include:

  • increasing employee productivity by 21%
  • it reduces and optimizes the cost of communicating by eliminating printing and reaching more people at any one time
  • it reduces perceived wait times by as much as 35%
  • it reduces workplace injury by 20% 
  • showcasing dynamic content vs. static content improves the retention of messages by 83%
  • it creates a 31.8% increase in overall sales volume
  • increases footfall by about 24% in brick and mortar stores
  • influencing the customers’ decision-making process to boost sales
  • boosting impulse purchases for retail businesses
  • doubling up as a form of entertainment
  • improves brand awareness by about 23%
  • it adds aesthetic appeal and modernizes a facility 
  • it increases interest and attendance of events by 20% 
  • improving internal communication
  • allows for real-time messaging, keeping audiences well informed at all times 

what is digital signage and how does it work

The Components of Digital Signage

Digital signage is not a stand-alone solution but rather a system of interconnected components that work together and complement each other. 

5 basic elements make up digital signage, namely:

    • A digital display or screen
      This consists of any screen with an HDMI port. We recommend using commercial-grade displays. Advantages include better and longer warranties, they are designed for longer operating hours and more longevity of use, they are brighter and well suited for commercial environments, and they support both vertical and horizontal orientations.

 

    • Media player
      The media player or digital signage player is a device that downloads content from the software, caches it on its internal storage and displays it on screens. The player is connected to the screen via HDMI. For the player to receive and download content from the software, it will need to be connected to the internet (via WiFi or a wired connection).

 

    • Digital signage software
      This is also called content management software (CMS). It is the brains of the entire solution. Software is the “back-end” where you create or upload your content, configure it and deploy it to your screens. The software is often cloud-based and can be accessed online from a computer allowing for remote content management.

 

    • Content
      Arguably, the most exciting element of digital signage. This is what you will display on your screens. It is what your audience will engage with, which makes it the single most important determinant of success and achieving an ROI. It’s important to optimize the content on your screens to ensure that it’s easy to understand and that it’s clear what your audience should do after seeing your content (i.e. does your content have a call to action?) Content can be images, videos, PowerPoint presentations or dynamic content like weather, news, RSS feeds, social media, webpages, event listings and more.

 

    • Digital signage champion
      The champion is the individual in your company that owns the digital signage project. This person will lead the implementation, operation and analysis of digital signage solution. Ideally, a digital signage champion should be a tech-savvy user who understands the brand and has excellent communication skills.

 

How Digital Signage Works

Digital signage systems are powered by a media player which pushes content to the display. Through the cloud-based content management software, users can then manage content in real-time. 

The process involves four steps, as shown below:

    • Connect the media player
      The player is typically mounted behind the screen. It’s connected first to the screen via HDMI, and then to the internet through Wi-Fi or a wired connection. Except for video walls, each screen or display will require its own media player.

 

    • Create content
      Once your hardware is set up and ready to go, the next step is to create the content. Content can be created within the software using content apps. It can also be pre-made content such as videos, images or PDFs which can be easily uploaded. You can show a single piece of content or create a multi-zoned layout to display multiple content at the same time e.g. a list of events, social media, weather, and time. You’ll then “publish a schedule of your content” which means sending content to your players with a schedule of when and where it should be displayed.

what is digital signage and how does it work

    • Display content
      The player will download the content and display it on your screens. In case you lose internet, the player will display the content that was last downloaded, so your screens won’t be blank.

 

  • Update content
    Most digital signage software will have content apps that auto-update. This means that when the source is updated (e.g. a Google Calendar for your event listings), the content on your screens is updated as well. Content schedules can also be updated to change the content being displayed or change the times it’s being displayed. 

The Cost of Digital Signage

When discussing the cost of digital signage, it’s important to note that there are two variables: CapEx and OpEx. 

CapEx is capital expenditure. This is the upfront cost for: 

  • hardware (screens, players, mounts, cabling)
  • software (is there a one-time cost for the software, is it free or is there a subscription)
  • shipping
  • installation

OpEx is the operating expenditure. This is your cost for: 

  • maintenance of the hardware
  • software updates (if your provider does not offer free updates)
  • content development (this is the most variable cost and can include content subscriptions, the cost of creating new videos, etc.)
  • managed services (the cost of operating your network e.g. monitoring the network, deploying content, extracting reports, etc.)
  • broadband access (internet costs)
  • …and more

The two above comprise the total cost of ownership (TCO). This is the sum of all costs incurred over the life of digital signage.

When looking at investing in digital signage and talking ROI, the evaluation should be made from a TCO perspective. Most buyers, especially in the SMB space, evaluate only the upfront costs. The operating expenditure is also just as important and is a big determinant of the shelf life of your signage.

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What is digital signage?

So there it is – we’ve answered your two questions and now you know what digital signage is (and is not) and how it works. No matter the industry you operate in, this is technology that you can rely on to communicate better with your target audience.