For Digital Signage, All (Digital) Signs Point To Double-Digit Growth

The digital signage market is poised for double-digit growth in the next few years, according to a study released by market research firm IDC.

According to the study, the digital signage market will grow roughly 14 percent to 15 percent in the next five years.

"My experience is that there are two levels customers are looking for with digital signage," said Tim Greene, research director at IDC. "One is, what are we trying to accomplish here? Customers need the channel's guidance to help them design and implement digital signage solutions. The second is the actual technical specifications of the screen and display quality."

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Already, about half of the companies surveyed by IDC are utilizing digital signage solutions. Players in the retail vertical, which traditionally used the digital displays for showcasing new inventory or promoting closeouts, are now pushing the limits with new features like facial recognition and touch-screen solutions.

Resellers, for their part, want to tap into the recurring service opportunities that the lucrative digital signage market offers through hardware installation, digital content management and other retail solutions.

ASI, a Fremont, Calif.-based hardware distributor, provides digital signage solutions from various vendors for its resellers, such as digital media players, LCD panels and panel mounts, video switches and repeaters, touch screens and software.

Kent Tibbils, vice president of marketing at ASI, said a majority of ASI's resellers already either deploy, or are interested in deploying, digital signage solutions, but a surprisingly increasing number of resellers are completely transitioning their business model to focus exclusively in the digital signage space.

While Tibbils said that the number of resellers with an exclusively digital signage-focused business is below 5 percent, he stressed that that number is increasing.

"We're seeing more and more VARs asking questions about it, and trying to get into it, and I think it's a testament to how good the market is," he said. "This is a vertical that we expect to do very well for many years to come, and we think we'll see double-digit growth in the coming years. It’s a great opportunity for growth."

Inova Solutions, a Charlottesville, Va.-based solution provider specializing in digital signage for call centers and help desks, also sees potential for growth in the digital signage space.

"There's definitely room to grow as we continue to develop applications and grow along with the market," said Jennifer Whedbee, senior digital marketing manager at Inova Solutions. "Now we're seeing a lot of contact centers going into the cloud, so that's a big area for growth for digital signage."

Other than the booming market, one reason why many resellers are seriously considering digital signage, said ASI's Tibbils, is because it is an easy business transition.

"Some [resellers] might look at cloud computing or big data as too big for their business to engage in," he said. "Digital signage is not like that at all. Partners have the opportunity to make solutions as complicated as facial recognition and video wall, or as easy as entry-level solutions like remote access for retail locations."

"A lot of our resellers already have the expertise in hardware and networking, and they know about graphics and display, so it’s a relatively easy market to get into," he added.

Vendors also are tapping into the hardware and software areas of digital signage, equipping solution providers with a broad array of components for the market.

On the hardware side, companies like ASI, LG and ViewSonic provide features like connectivity products, cables, touch-screen displays and panels to set up the digital sign, while companies like Intel provide the software to stream digital content through its Intel Retail Client Manager solution.

Retail clients who express interest in digital signage prioritize factors like display quality, size, ease of use, as well as maintenance and support, according to IDC. The study also found that a direct vendor-to-customer relationship is key, but not all company sizes and vertical markets said they prioritized this factor.

The main concept resellers have to bring to the table, said Tibbils, is creativity.

"Resellers with a lot of imagination and creativity can expand in this market," he said. "It can get interesting what customers are trying to do."

PUBLISHED MAY 19, 2015