Beyond Signage

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by Steve Gurley, Symon

The Cellular Telecommunication Industry Association (CTIA), a massive trade group representing the wireless industry, kicked off its fall 2009 season with its annual Wireless IT and Entertainment conference. The purpose of this conference was to explore how wireless and mobile technologies can and will be used to redefine how business is conducted. One of the conference sessions was a half-day seminar entitled “The Mobile Retail Experience.” This seminar was one of the many that will define how smartphones will make new and innovative in-store marketing applications possible.

At this point you’re probably saying to yourself: “That’s nice, but what does this have to do with digital signage?” you ask. The answer is: “Plenty.” This seminar was a part of an emerging trend that will enable smartphones to serve as both a competitor to digital signage as well as a complement to digital signage. Modern mobile communications can be traced back to 1973 when the first cellular call was demonstrated to the public. This call ushered in the first era of mobile communications wherein the average consumer could talk without wires. We’ll call this the Personal Communications era. The second era started in 1995 with the launch of digital wireless networks. This era, which we’ll call the Personal Productivity era, ushered in wireless email, wireless calendar management, web browsing, text messaging and other data oriented services.

The third, and current, era of mobile communications started in 2007 with the launch by AT&T of the Apple iPhone — a super sophisticated and easy to use smartphone. We’ll call this the Personal Impact era wherein consumers begin using their smartphones as a platform to manage their health, wealth and
entertainment. So what spawned the Personal Impact era and what are the implications for the future?

Prior to 2007 and the launch of the iPhone, wireless carriers generally sought to control nearly everything that touched their networks. They attempted to control the devices that went on their networks; the applications that ran on their networks, the way the devices accessed the networks, etc. Then the Apple/AT&T alliance changed everything. AT&T began allowing an outsider (Apple) to place a device on their network that had near-unbridled access and could do everything from downloading content to mapping a user’s location while the user listened to music. Things changed further in the summer of 2008 when Apple announced the iTunes app store. Suddenly, seamless and virtually unrestricted access to content, to applications, and to all of the things that the applications could do were now clearly in the domain of entities outside the control of the carriers.

As AT&T’s subscriber roles began to rapidly grow under this new use model, as the iPhone quickly became one of the fastest selling handsets by virtue of its functionality and as mobile application adoption reached unprecedented levels of consumer penetration, other device manufacturers and wireless carriers began to aggressively jump on the smartphone and mobile application bandwagon. By the end of 2009 alone, approximately 60 new smartphone models will have been launched and almost one in three new cell phones sold are projected to be smartphones. These predictions have been reinforced by second quarter 09 sales of smartphones, which were up 47 percent over the same period last year. As we look beyond 2009, it has been forecast that nearly one out of every two phones sold in 2011 will be a smartphone.

As smartphones occupy a larger share of the mobile subscriber base, the impact will be five-fold:

• First, the additional functionality that the smartphone offers will make traditional mobile marketing applications such as SMS marketing, Bluetooth marketing and mobile web marketing services less appealing as they are supplanted by more sophisticated applications.

• Second, there will be an emphasis by application developers to find more and better ways to centrally manage and deliver dynamic, interactive, multi-media content to the smartphone.

• Third, there will be an emphasis by application developers on using the smartphone’s locationidentificationcapabilities to deliver content that is tailored to the users’ location.

• Fourth, there will be an emphasis on seamlessly integrating mobile commerce with the content so that smartphone users will be able to immediately respond to a call to action contained in the content.

• Fifth, there will be an increased emphasis on remotely measuring and reporting user interactions with the smartphone content and the corresponding calls to action. What does this mean to and for digital signage as more wireless subscribers gravitate to the next generation of smartphones and smartphone applications? The implications are many, and profound:

It will mean that digital signage will face even more competition for ad dollars as advertisers and their agencies recognize the smartphone’s ability to provide more extensive viewer metrics — particularly when the smartphone can do so on a one-to-one basis. Digital signage will need to become more sophisticated in delivering viewer metrics, which will mean that interactive digital signage will need to take a more prominent role in future deployments.

And digital signage will come under intense pricing pressure as venue owners and network operators gravitate to much less capital-intensive smartphone-enabled content solutions as opposed to traditional digital signage solutions that will require expensive monitors and media players. If that was not enough, digital signage will need to work in concert with smartphones, which means that digital signage will need to play a more active role in promoting the use of their smartphone.

On the content side, digital signage content management systems will need to interface with the smartphones so that content assets and messages can be shared and leveraged across the two platforms.

In summary, the future of the mobile device is the smartphone and more companies like those who are attending the Mobile Retail Experience seminar will seek to identify and exploit the opportunities that the new generation of smartphone and carrier model enables. The smartphone will provide a sophisticated platform on which to deliver content, and the application-oriented nature of the smartphone coupled with its wireless connectivity will provide unparalleled content tracking, accounting and reporting capabilities. Digital signage will need to co-exist with the smartphone in a value-add manner or risk being relegated to a low-cost commodity similar to digital wall paper.

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