How To Get A Good Digital Signage ROI
Want to know how to get a good digital signage ROI (return on investment)? We’ll help you decide if you should invest in it, and if so, how to put a solid business-case together that details how and when you’ll get your ROI. We’ve even created a free ROI/business-case builder tool to help you.
If it’s used in the right situation and with the right content, digital signage can deliver fantastic results and more than pay for itself. BUT there’s no getting away from the fact that it can involve a substantial investment.
Unlike online marketing tools, digital signage doesn’t automatically produce an endless stream of marketing analytics info that prove how valuable it is to a business (though producing some analytics info is now possible).
Subsequently, many marketing/communications professionals struggle to convince their more sceptical colleagues of the value of digital signage.
For some companies, digital signage genuinely won’t be a great fit and/or the cost versus benefit sums won’t stack up. But for others it can be a real game-changer.
In order to persuade an entire board table of the benefits of using digital signage in your organisation, you’ll need to do more than just show how you could use it. You’ll need to present a robust business case that’s so convincing of why you should use it and when you’ll get your ROI, that people will be lining up to take credit for suggesting it.
We’ll help you identify if your company should use digital signage and why, and if so, how to build a solid business case for it that spells out when and how you’ll get your return on investment.
When Should We Use Digital Signage?
Define the needs and opportunities
It’s vital to identify and highlight what unmet need or needs within the organisation could be satisfied by using digital signage. This could be a single need, but it may also be that different parts of the organisation are facing problems that could be solved simultaneously by displaying different pieces of content on digital signage.
Consider all the different departments within your organisation and the types of communication objectives and issues they may have – with staff and customers – and how digital signage may benefit them.
Once you have identified all the potential uses for it, you’ll need to gather evidence and opinions from all parts of the organisation. This could be achieved using a range of approaches, from observation to surveys and focus groups. The more hard data you have about relevant problems, the stronger your business case will be.
When you’ve gathered the data, make a list of the issues within the organisation that might be addressed by using digital signage and identify what each of those issues costs the business each year. This will form the basis of your business case.
Identify your goals
Once you’ve identified the issues, you’ll need to set goals for addressing these needs. These should be as specific as possible. Rather than “providing information to customers/staff”, you should create of list of:
- all of the types of information you will display using the digital signage estate
- what you aim to achieve as a result of showing it
- what timeframe you aim to achieve each goal within
- what metrics you will use to gauge success in achieving each of the goals you’ve outlined
This list of goals will allow you to structure your approach to planning your business case. However, they will need to be made more specific when you’ve researched further — including the projected cost and ROI.
Seek expert help
Once you’ve identified what problems you want to solve and how much they cost your business, you’ll need to find out how much it will cost to implement a digital signage solution to fix them.
It can be easy to make false assumptions about what you need, so avoid pricing hardware and software yourself. Instead, speak to a digital signage consultancy to get their advice.
Give them a broad picture of your organisation’s needs and problems, your thoughts on where and how you envisage using digital signage (including the types of content you have in mind) and if you have one, your budget.
A good digital signage consultancy will be able to use this information to identify the right solution for your situation (they should also be able to explain their recommendations to you). They may also be able to identify additional ways your business could use and benefit from digital signage, or suggest cost efficiencies. They should also be able to guide you on the right place to position and sizes for screens.
How Do We Build A Business Case For Digital Signage?
What exactly is a business case?
A business case is a powerful tool to persuade the key stakeholders that your proposal will benefit the business, which ultimately means demonstrating its expected ROI. It involves gathering evidence and presenting it in a form that will be persuasive to the decision makers.
It’s generally best to present a business case in a variety of formats, since people’s preferred ways of receiving information can vary widely. Typically, it may take the form of:
- A one-page executive summary, for those who like a high-level argument.
- A longform document outlining your business case, starting with an overview, giving detailed information and finishing with a recommendation. This is aimed at those who will want to analyse your data.
- A presentation, aimed at those who respond better to enthusiasm and the personal touch.
Building the financial case
Ask your digital signage consultancy how much the hardware and installation will cost, and what ongoing costs there would be (e.g. software, support), and whether the costs could be spread or reduced, if necessary.
Using the figures supplied by the consultancy, you can now map the cost of inaction and not meeting your goals against the cost of installing and running digital signage to see whether it makes good financial sense, and how long it would take for the project to pay for itself in cost savings or profitability increases.
Most commercial screens have a standard warranty period of three years – though five year extended warranties are available with some manufacturers – so you should build your business case around that three year guaranteed life span – though most screens last much longer if not not in constant use.
The financial element of your business case should include both a best-case and worst-case scenario for the payback period to show the business potential, but also to avoid appearing overly optimistic.
Try using the Saturn spreadsheet below which contains a template to help you build your digital signage business case, and an example of what a successful business case might look like.
Saturn – Business Case Builder Spreadsheet (Sample & Template)
Putting it all together
When you have the problems and goals, the recommendations made by the consultancy and the cost of both using and not using digital signage, it’s time to draw it all together.
It will be essential to have a strong plan for how you’ll monitor the success of the project. This will not only allow you to confirm whether the projected ROI is being achieved, but also to identify how to make continuous improvements in areas such as product sales.
You’ll need your business case to provide as much hard evidence as possible, and there are ways to increase this. For example, you might be able to arrange a pilot project with no long-term commitments, to find out what impact digital signage would have on a specific issue.
When you have as much data as possible, consider exactly who you’re going to be pitching your business case at and emphasise the benefits they’ll be most concerned about. For example, the Chief Financial Officer is likely to want clarity on when digital signage will start to give an ROI and the value of the benefits it will deliver.
Think about whether it is easy to appreciate the value of digital signage purely by reading written documents, or whether pictures and videos would help to communicate the benefits of using digital signage more effectively – especially if they show the sort of content that would be likely to appear.
Then pull it all together into your executive summary (which should be written last), your longform document with as much data and figures as possible, and ideally this should be supported by an engaging and persuasive presentation.
Run an expert’s eye over it
When putting your business case together, ask your digital signage consultancy to support you. Talk through the basis of what your business case is with them and ask them for suggestions for improvements or supporting evidence. It is, of course, in a consultancy’s own interest to help you deliver as compelling a business case as possible, so most will be only too happy to help.
Ask if they have any visual materials that they can supply you with. Most will be able to provide product pictures, but they may also be able to provide you with examples of the relevant types of screens in situ in a similar situation. This will help to give stakeholders a clearer idea of why the screen size/type you’ve recommended is best.
Your consultancy may also be able to provide examples of content they’ve created for other clients, or create something bespoke for you (though there may be a cost attached to this depending on the level of complexity you require) so that stakeholders have a clearer understanding as to what the value to the business might be with customers/staff seeing this sort of information.
If you’re delivering a presentation, ask your consultancy to come along so that they can offer support with answering questions. They will have a much broader understanding of the technology, the process of installation, and the level/type of resource needed on an ongoing basis. They will also be able to talk about relevant challenges they and their clients have successfully overcome, and the positive outcomes that other clients have had from using digital signage in similar situations.
The importance of your business case for digital signage
Digital signage can provide a great solution for a wide variety of your organisation’s needs, whether a single issue or multiple problems. However, in order to be effective and provide a clear ROI, you need both a well-thought-out strategy and specific planning, such as where the ideal positions would be for signs carrying a certain type of content.
Putting together an effective business case will convince the essential decision makers in your organisation that digital signage is low risk, and provide the planning that should ensure success when you do go ahead with your programme.
Get in touch with Saturn Visual for help with preparing the data for your business case.
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