Frost & Sullivan sees the Australian digital signage market growing and maturing with a shift to specialist service providers and increasing integration with other technologies for marketing applications.
F&S is forecasting a 13.9 percent annual growth rate in the Australian digital systems signage market by 2020. According to F&S’s Australian Digital Signage Systems Market 2015 report the digital signage systems market grew by 12.1 percent during 2014 to reach $133m.
Phil Harpur, F&S’s senior research manager, Australia & New Zealand ICT Practice said: “Retail is one of the fastest growing markets for digital signage in Australia with most major Australian retail chains and shopping centres having installed some form of digital signage systems. Other fast growing retail segments include telecommunications, banking and fast food chains.”
Evolving from capex to opex
He added: “The digital signage systems market is moving from outsourcing hardware, software and services components to an internally managed, lower cost, cloud based business system that is part of a wider digital services and marketing ecosystem. It is also evolving from proprietary-based to an open, multi-functional platform environment. It is transitioning from a capex to an opex driven market model; driven by specialist IT service providers that manage the entire digital signage deployments from the concept stage to account management, project management and ongoing maintenance.
“Previously, smaller AV integrators drove the market, whereas now, major providers offering digital signage solutions like Telstra, NEC and Entwined Solutions offer a wide range of services across a broader digital ecosystem.”
According to F&S, over the last couple of years, outdoor signage saw large scale digital signage rollouts deployed in the public transport sector; such as in train stations in major cities CBDs and at international and domestic airports in Australia. It says opportunities remain in public locations using billboard signage instead of digital signs.
“In the corporate sector, digital signs, including high-definition video walls, are being deployed in CBD office towers, foyers, lifts and car parks. There has been strong demand from tier one financial institutions and banks, and the tier two banking sector has had strong momentum over the last 12 months.”
Traditional IT service providers and telcos have significant capability and potential to expand into the digital signage sector. “Due to their ability to control and monitor all elements of the network, including mobile, apps and carriage, telcos could potentially be leading media providers for Australian businesses. Telstra is developing partnerships across the entire value chain of digital signage.” added Harpur.
F&S also sees increasing sophistication and integration with other technologies being used in advertising and marketing applications.
“Data collected and analysed from strategically placed in-store sensors allows predictive analytics applications to instantaneously modify advertising content based on audience demographics. Multi-sensory experiences such as incorporating audio and aromas can be deployed to enhance the consumer experience and complement digital signage. Smartphones can extend the experience by providing supplementary information or targeted advertising. Proximity beacon functionality is now being pre-installed into digital signage system rollouts locally by IT service providers.”
Audrey William, Head of ICT Research, Frost & Sullivan Australia & New Zealand said: “About ten major companies compete in the Australian digital signage systems display market. Samsung and NEC are the top two providers and account for around two thirds of the overall market. However, established market participants are experiencing significant pressure on pricing; especially at the lower end of the market, from cheaper Korean and Chinese manufacturers.”
On the down side, Harpur said, “Network operators are constrained by the lack of availability of consistent bandwidth to stream high quality content in high definition. Audience standardised metrics to justify RoI to retailers is lacking and many retailers will not implement digital signage unless RoI can be directly measured. Privacy is a major issue with digital signage rollouts using facial recognition via sensors and cameras.”