According to the study, “Marketing & Media Ecosystem 2010,” a joint effort by the Association of National Advertisers, the Interactive Advertising Bureau, the American Association of Advertising Agencies and management consulting firm Booz, Allen, Hamilton, 51 percent of respondents identified limited experience with digital media. The study indicated that fewer than 25 percent of respondents to a recent study of marketers, agencies and media companies said their organizations were “digitally savvy,” while more than 90 percent reported they plan to increase what they spend on their digital marketing efforts. The disparity highlights the inherent problem with advertising on digital signage networks.

As I have said in the past and continues to be true today is one of the serious impairments to growth of the digital signage industry is the fact that retailers do not recognize digital signage as a mission critical application. Because of this, retailers who are considering digital signage are easily convinced to delay the implementation of digital signage networks when the economy or other internal business issues are encountered.

This intrigues me because studies of digital signage deployments around the world have indicated that over 90+ percent of customers who travel through a store recognize digital signage advertising and are attracted by the ads displayed on the screens. Up-sale of products and services, due to digital promotions and focused in-store advertising, has increased as much as 35+ percent is various retail locations around the world. Other studies have indicated that from 50 to 70 percent, depending on the research you read, of customers make purchase decisions while they walk through the store.

We live in a digital age. Consumers get their information on products and services directly from the Internet or their smart phones. As the average consumer is bombarded with digital advertising in every aspect or his/her life, it is natural to extrapolate that consumers expect to use the same tools when they shop in their favorite stores.

This study uncovers one of the major reasons why retailers are reluctant to implement ad-based digital signage networks — their ad agencies haven’t come up to speed on the benefits of the technology and are reluctant to advise their customers to employ digital signage.

Part of the reason for the ambivalence is ad agencies, marketing organizations, and media companies are trying to use metrics from print-ad applications or TV-ads to measure the effectiveness of digital advertising. Research has shown that digital signage (digital advertising) is not print advertising, it is not Internet advertising, and it is not TV advertising. All of these “traditional” forms of advertising are based on delivering a broad-based message to a mass audience. Digital signage, on the other hand, delivers the RIGH T message, to the RIGHT audience, at the RIGHT time, and at the RIGHT location. This unique aspect of digital signage cannot be duplicated by more “traditional” advertising.

As Bob Liodice, president and CEO of the Association of National Advertisers put it: “The impact of new media is changing the way marketers interact, target and distribute their marketing message. As the marketplace shifts to a digital interactive environment, marketing organizations, agencies and media companies need to transform existing marketing agendas and capabilities to succeed.”

Ad agencies, marketing organizations and media companies need to re-orient thinking about metrics: Interactive digital signage offers marketers instant access to consumer preferences and interests. Polling consumer interaction can provide valuable insight about which messages work, which don’t and where to go next. Taking account of those statistics not only can help with tactical dynamic tweaking of an existing interactive digital signage content, it can also provide valuable audience metrics that can be used to build future strategic plans.

Digital signage is experiencing exponential growth in many vertical markets including: Corporate Communications, Education, Entertainment, Financial Institutions, and more. However, the one vertical market where digital signage can express the highest benefit, Retail, has not displayed the growth potential expected. There are many reasons for this, the economy, the investment, metrics, etc. but the most critical issue is that Retail has not recognized digital signage as a mission critical application. Until ad agencies, marketing organizations, and media companies convince their Retail customers of the benefits of the technology, Retail will continue to lag in growth potential.