If that billboard off the highway suddenly changes from a promotion for a retail chain to a plug for a local car dealership, don't get your eyes checked just yet. The next great frontier in outdoor and point-of-sale advertising is internet-connected digital screens, which vary in size from a few inches to many feet in length and width, allowing advertisers to showcase graphics and streaming media. Industry experts believe these boards will compete with, and may ultimately replace, traditional billboards and in-store signage.
"It's very reasonable to assume that up to 25 percent of traditional billboards could be converted [to digital displays] within the next 10 years," says Stephen Freitas, chief marketing officer of the Outdoor Advertising Association of America Inc.
That would translate into serious money. The OAAA estimates that advertisers spent $6.3 billion on outdoor advertising in 2005. With digital displays, messages can be updated with a few keystrokes instead of through the somewhat arduous process of tearing down a printed message and affixing a new one.
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In addition to outdoor applications, companies like The MediaTile Companyin Scotts Valley, California, are creating networks of in-store displays that are connected to the web. In MediaTile's case, the networks use wireless cellular technology. Clients can upload and change content through web-based portals, creating content in the forms they want--anything from still image montages to narrowcasts, or live-action programming broadcast on a network of screens.
"Once the networks are in, the screens can become a revenue stream through advertising and content creation," says Keith Kelsen, MediaTile's president and CEO. He adds that the screens can be used to feature product-specific information as part of a special display, or they can even broadcast employee-training programs. Setting up an electronic display system shouldn't set you back too much: Kelsen estimates a business can install two screens for as little as $350, not including the costs of content creation and maintenance.
The flexibility of these displays is driving demand, says Freitas. Big advertisers like McDonald's can change their messages almost instantly, promoting breakfast sandwiches in the morning, salad options midday, and burgers and other fare during dinner hours. For smaller advertisers, digital displays can open up new possibilities, letting them share time on billboards in prime locations at a cost that suits their budgets.
Freitas insists the emerging technology is a must-watch for the coming years: "Digital paper, or digital ink--a flexible material that can show different messages--is being developed," he says. "It's quite possible that this will have a significant impact on changing the scope of this type of advertising."
Originally published in the July 2006 issue of Entrepreneur Magazine