One question we get asked all the time is “what is the ROI on a digital sign?”
Answer; It depends. The digital sign is a creative tool capable of improving your marketing so before we can calculate a ROI number we need to know what you will do with it. Let me tell you a true story to illustrate my point. In 1980 I was VP General Manager for Moog Music and we were owned by the Norlin Corporation. We did endless mind numbing budgets by hand on thirteen column accounting pads which made me nuts.
In 1979 I saw an advertisement for VisiCalc, the first spreadsheet program. It cost $250 but you needed a computer to use it. Our company computer was a big dumb corporate monster in another city that only the accounting people could use. In 1980 I spent a whopping $2,500 for a Radio Shack TRS-80 Model III computer and another $250 for VisiCalc which was a princely sum for me at the time. It was expensive but it freed me from making budgets by hand. If I calculated the ROI in the computer purchase against the time I saved it might have been a poor investment.
Some years later I changed jobs and went to work for an electronic materials company. They had a large manufacturing plant with a three story roller coater machine that operated 24 hours/day; every day of the year except Christmas. It was five years old and the company had plenty of experience using and maintaining the machine. Business was good, we were selling everything we could make. But everything we made was on that one machine and it was impossible to get another one without many years of planning, building construction and government permits because we consumed tank cars full of solvents and resin in this machine. Since we made many different products, the machine was readjusted continually which meant is was stopped, adjusted and restarted all the time.
TRS-80 Model III ComputerBy this time I had a few years experience programming the TRS-80 so I developed a new shop traveler for the factory as each product batch was custom made to the customer’s specification. The plant always had shop travelers but mine was different; we changed the terminology of the product parameters to numbers instead of the historical terminology. The reason was simple, we could load all the travelers into the computer and make a schedule for a whole week’s production. The numbered parameters had a hierarchy of importance so the number of times the machine had to be stopped for adjustments was greatly reduced as most changes could be made on the fly.
The results were dramatic. We increased output 30% with no capital investment, no changes in product quality or product composition. The increased output was strictly from better machine management and production planning. And it was worth millions of dollars. We increased sales 48% while earning 10.5% on sales and almost 40% R.O.N.A. If we calculated the ROI of that TRS-80 now it would be the golden goose.
A digital sign is to traditional signs is what the TRS-80 was to the thirteen column accounting pad. It is a game changer. If you use a digital sign to its full capability it can make a dramatic improvement in your marketing, help you increase sales and steer customers where you want them to go. Back to our original question on ROI; how will you measure it? Digital signage can pay for itself in a few months if you use it to its full potential.
