The investment of digital signage often brings about the question: “What will the ROI be?” or “Will there be any profits?” New investors of this technology are concerned about whether or not there will be any returns – and of course, there is good reason to be concerned with such a large investment.
Manufacturers of digital signage however, emphasize that, along with the focus on ROI, end users should give equal importance to return-on-objective. This could be explained better as follows:
- What is the overall objective in terms of the digital signage investment?
- How would the end user want to measure the objective?
- Is it used simply for sales increment?
- Or are they looking at enhancing overall customer satisfaction and experience?
A discussion was held with experts with regard to ROI, ROO and how end users can obtain a guarantee that their investment will “make money” in return.
Beginning with the most common/obvious question –
How can an investor know that he/she will make money from the digital signage investment?
It is important to understand the customer demographics and what kind of messaging or experiences will attract them. This is critical in driving conversion and achieving customer satisfaction. With the help of business intelligent platforms, firms can obtain insights to accurate message conversion rates which provides a wider visibility on the performance of content.
Investors must make sure their digital signage solution offers analytics such as gender, age, dwell time, traffic and message impressions. Such non-identifying data will help understand digital signage success much better. Also make use of intelligence platforms that process this information to suggest more relevant content and to trigger ads that will drive sales and conversion. This is the best way to observe how much returns are coming in from the investment. Test messaging is another important factor in determining what content and format is best in driving conversion. These platforms can also evaluate the effectiveness of a message because it relates to various promotion periods. As a result, firms can improve performance and ROI for future promotions.
Basically, business intelligence platforms do not require firms to do any guesswork on the part of understanding customer base, how they spend their time in the space of the company, what messaging types are most effective for conversion and customer experiences. All these answers are available on the platform, thereby making the job much easier for digital signage users.
Is it more important to focus on ROO or ROI?
ROI and ROO both go hand in hand and are two important things a business should focus on. The end goals of a digital signage campaign will determine which of these is more important. A big investment like this must drive sales and conversion for a business.
ROI can be measured through intelligence platforms: messaging impressions can be calculated against conversion rates and these can drive revenue streams for advertising. Returns on promotional activities can also be measured accordingly.
ROO is more important in providing different metrics such as brand building and other such business objectives that are not in direct relevance with revenue, yet have significant value in positively effecting the business.
Some important metrics that firms should keep measuring are conversion rates and message impressions. These two are essential in understanding ROO, ROI and ROE.
Are there any pitfalls to avoid when measuring ROI and ROO?
Before you try to measure success based on ROO or ROI, first have a clear understanding of what you are trying to achieve. ROI is a tangible metric that demonstrated monetary gain. ROO is not really measured from a monetary perspective but significantly impacts the product offering.
In both cases, business intelligence is the key to provide actionable insights such as customer behavior, buying patterns and demographics. A strong intelligence platform is essential in successfully deploying a digital signage campaign.