The Recession’s Boon on Digital Menu Boards

Posted by on Jul 15, 2011 in DOOH, Industry, Insight

Because I have at least somewhat of a pulse as to how the overall digital signage industry is shaking down and out, I’ve been asked a number of times, “what segment(s) of the market do you see as having the greatest potential in both near and long term horizons?” The information is not some proprietary trade secret, but represents the opinion of what I see going on. The two sectors we see growing at the moment include education for public communication signage and QSR (quick serve restaurants) in the use of digital menu boards.

I want to spend just a small moment on the education sector. This sector has surprised me as a growing segment of the market for a number of reasons. First, many state schools have had major budgetary setbacks of late which has put the crunch not only on staff, pay and even necessary supplies, but also on discretionary technology spending–of which digital signage is represented. And, since there are those in the industry who would like to say “digital signage is necessary” or “spend more on my software because of differentiating features 1, 2 & 3…”, I still hold to the mantra that software eventually becomes a commodity or at least will become so cheap it’s free, especially when it reaches any sort of scale. That said, either education is choosing to spend money on what was once considered a luxury, or digital signage may actually be that next necessary requirement for public buildings. You take your pick.

As for digital menus and digital menu boards, I see the growth coming for a number of reasons. First, I think people are coming to expect it from large restaurant chains (esp. now that McDonald’s, Taco Bell et al all have them now). Second, and perhaps more impacting has been the success of national quick serve restaurant chains during the economic downturn:

At a time when restaurant chains, hit by higher operating costs and lower spending among diners, are scaling back growth plans, fast food companies, emboldened by new custom and lower rent, have expanded their presence on high streets. According to the Local Data Company, which monitors 705 town centres across the UK, the number of fast-food chains in the top 10 UK cities rose 8.2 per cent in the year to October, after a 6.6 per cent increase the previous year.

Central London posted the biggest gain, adding 73 units to bring the number of outlets to 847. It was followed by Manchester and Glasgow, which added 16 and 13 respectively bringing their number of fast-food restaurants to 74 and 94.

A rising tide may float all boats, but you also have to chase after the dough. When famous bank robber Willie Sutton was asked why he robbed banks he responded pointedly, “because that’s where the money is.” The QSR sector may be diners’ lowest common denominator, especially when things get rough, but that also means there is money flowing there. Consequently, some of the largest recent deployments by digital signage firms large and small have included something about “digital menus” this or “restaurant signage” that. I would conservatively say that easily 30% of our sites current leads–in accounts large and small–come from companies in this sector.

My prediction: digital menu boards are going to be the boon that eventually takes the digital signage industry where it wants to be in the future. Now, you industry-ites, don’t all go knocking on the same doors at one time.


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