Changing retailer needs spur tripling of retail digital signage market

EL SEGUNDO, USA: The changing needs of retailers are prompting them to move away from traditional advertising and seek alternative means, including retail digital signage, whose shipments will more than triple by 2013, according to iSuppli Corp.

Global shipments of digital retail signs are set to rise to 2.5 million units by 2013, generating a CAGR of 26.8 percent from 758,122 units in 2008. The figure presents iSuppli’s digital signage growth forecast.Retail signage spans a range of display types and functions, from LCD screens to LED video displays that are used for digital merchandizing, enhancing ambiance as well as customer and brand communication for both indoor and outdoor settings.

“Competition is getting fierce among retail outlets, and they are seeking innovative ways to attract new customers and increase average transaction size and frequency of visits among existing clientele—making digital signage a perfect fit for their needs,” said Sanju Khatri, principal analyst for signage and professional displays at iSuppli.

Another factor driving the adoption of retail digital signage is the demanding and rapidly changing product or service revisions inside retail outlets.

As products change quickly and revisions with new features come fast and furious, maintaining active communication with end-customers is key for successful merchandizing. Retail digital signage offers a way to communicate these changes and revisions on a real-time basis, but also allows advertisers to control, schedule, monitor and change content locally or even remotely.

“Television and print are costly and not really suitable in communicating with target audiences in a real-time manner,” Khatri said. This has prompted advertisers to seek more effective ways of communicating to their target audience groups and to maximize their return on investment.

Because of this and other factors, iSuppli believes many retailers will accept the initial costs of migrating to digital signage platforms given that the benefits to retail establishments are greater than the current non-digital signage they are using.