Connectedsign Digital Signage White Paper

The Digital Signage Ad Spot Conundrum
Connectedsign, LLC

If you're a digital signage network owner and your business model is built on selling ad spots, screen placement has a bigger impact on your success than you might realize. Where you position your displays within retail venues influences whether advertisers will continue or pull their spots. And their decisions often seem arbitrary.

Below, we'll explore the business of selling advertising placements on your DOOH network. I'll describe the key factors at work and explain why advertisers make the decisions they do. For example, a lot of network owners fail to understand why it's so hard to sell prime spots while advertisers often flock to poor-performing spots. You'll understand why in a moment.

Where Do Shoppers Look?

At the foundation of this entire issue lies the nature of shoppers. When someone is shopping, they normally look at eye level and downward. As a network owner who places screens in retail venues, you already realize this. This is the reason ad placements are priced higher when the digital screens are positioned at eye level. As a side note, this is also the reason venue owners treat that area as precious real estate. They too, realize it's important because that is where shoppers look.

This poses a challenge for the DOOH network owner. Placed at eye level, your screens are more effective. They may be viewed by less people since ceiling-mounted monitors enjoy a wider view zone, but the shoppers who see them are more inclined to watch them. That means they're more likely to receive your message and respond. That's why screens at eye level of more effective and the corresponding ad placements are more expensive.

The problem is, many large advertisers see things much differently. And this is the reason they often balk at taking the most effective spots.

Selling Spots Depends On Measurement

Large advertisers make their purchase decisions based on the number of people who see their signage clips (i.e. CPM). You'll remember that screens placed higher within a venue have a wider view zone than those positioned at eye level. That, of course, means a greater number of shoppers will see them, which is why those placements are more valuable to large advertisers than spots shown at eye level. Even though you realize that signage clips on lower placements are more effective, they're more difficult to sell.

The Case For Smaller Advertisers

So, why do large advertisers focus primarily on the number of people who see their clips when pricing their digital media purchases? They do so because their buys are large and usually spread across multiple networks. Basing price on screen placement is all but impossible when your signage clips are showing across thousands of screens. The downside for a DOOH network owner is that a lot of larger advertisers pull their spots after they determine their placements are failing to generate a return. It's a catch-22.

Smaller advertisers are more likely to track the effectiveness of their media purchases. After all, their signage clips are streaming across far fewer screens than large big-brand advertisers. This is one of the reasons many DOOH network owners fill their loops with segments from smaller advertisers.

Lest it be perceived as such, it's not my intention to suggest that selling ad placements to large brands is without merit. There are many big-brand advertisers who understand that screen position impacts signage effectiveness. Just as important, they appreciate that segments can be more effective even though they are viewed by fewer people.

If you're operating a digital signage network, it is critical that you're able to explain to potential advertisers why their media buys should not be based solely on CPM.

By Loren Bucklin
President

Connectedsign, LLC
lbucklin@connectedsign.com
www.connectedsign.com
866-833-2723

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