In the 2002 science-fiction film "Minority Report," Tom Cruise's character is harassed by moving, talking, targeted advertisements everywhere he goes.
New technology is bringing that scenario from the movie screen to real life for everyday consumers. Digital signage -- those increasingly ubiquitous television and plasma-screen displays in shops, train stations, banks and other public spaces -- is giving companies the ability to change messages quickly and target them more effectively than paper ads.
TV screens have been cropping up in stores for more than a decade, but increasingly, those screens are connected and controlled from a main office via the Internet or satellite. This allows companies to change their messages at different points of the day and better tailor them for different locations.
In Germany, 600 Burger King restaurants carry two screens displaying programming and menu specials, which vary at different times during the day. In the morning, the program targets commuters on their way to work with news stories and breakfast-menu promotions. In the early afternoon, the emphasis shifts to mothers with their children. In the late afternoon, the aim becomes teenagers stopping by after school.
Pitching messages at broad demographic groups during specific parts of the day is one thing. But new technologies could someday allow advertisers to target even more closely. LM3 Labs, an interactive-technology development company with offices in Tokyo and France, has created a program that lets signs pick up on basic information about their surroundings. Using a Web cam that is hooked up to a computer, the program can scan a range of 9 to 15 feet from the sign and distinguish between a group of people or an individual, as well as between children and adults.
By reading the audience, signs can target messages more effectively, says Nicolas Loeillot, managing director of LM3. "There is a struggle in justifying the investment in digital signage equipment," but this technology helps justify the cost by measuring just how effective the sign is, he explains. Called Catchyoo, the system can log how many people pass by the sign, how many linger in front of the sign, how long they stay and so forth.
In its next incarnation, Catchyoo will be able to make out people's arms and note when, for instance, they point at a product and target information that way, Mr. Loeillot says. Technology someday will enable the signs to distinguish gender and more specific age-group information, "but not tomorrow."
Catchyoo will be added to some digital storefront signs in Tokyo at the end of the month. The company is looking for partners in North America.
In the U.S., where camera surveillance hasn't gained the kind of widespread acceptance that it has in, say, London, this kind of technology could raise privacy concerns. Developers point out that the camera images aren't stored or saved. In any case, the technology doesn't aim to identify individuals.
Another take on the technology comes from International Business Machines Corp., which has been focusing on technology to help make stores more efficient and customer-focused. One of the ideas it has brainstormed is a digital display for use in apparel-store fitting rooms that could communicate with radio frequency identification, or RFID, tags in clothing. Customers would be shown personalized recommendations for other styles or complementary pieces and could press a button to get help from a sales person who would know exactly what to bring.
Some retailers have seen good results with the digital signage systems in their stores. Asda, a British superstore chain owned by Wal-Mart Stores Inc., found that digital signage boosted sales of advertised products by 10% to 11%, said Steven Platt of the Platt Retail Institute, a think tank in Hinsdale, Ill.
Digital signage, a relatively new market, is expanding fast. Research and consulting company Frost & Sullivan estimates that companies spent about $148.9 million on displays, software maintenance and related costs in 2004. That total is seen reaching $489.7 million in 2011.
The space is becoming increasingly important for advertisers as well. Frost & Sullivan estimates that companies spent $102.5 million on advertisements that appeared on networked displays in the U.S. and Canada in 2004. That market is expected to expand into a $3.7 billion-a-year business by 2011.
"It's very clear that standard advertising today to mass millions isn't working anymore," said Richard Trask, director of marketing at Scala Inc., an Exton, Pa., company that provides software for digital signage.
TV advertising is being battered by splintering audiences and digital video recorders, which let users fast-forward through commercials. This increasing difficulty of reaching mass audiences has companies searching for alternatives.
Digital signage is appealing because of its flexibility and efficiency. The centralized control ensures that all store locations of, say, Abercrombie & Fitch Co.'s Hollister clothing stores, are playing the right videos at the right times. Promotional campaigns are guaranteed to start at the same time, with no chance of a renegade store running it too early or missing it altogether. Also, promotional materials can be created and distributed faster than through usual means.
With digital signage, companies can distribute new ads in minutes whereas usual billboards take days, says Bill Ripp, director of Lamar Digital, the digital signage unit of Lamar Advertising Co., one of the country's largest billboard operators.
Lamar has about 24 LED-display billboards -- which resemble giant-sized TV screens in sports stadiums -- installed in various roadside locations in the U.S. and 10 smaller poster-size digital display panels in and around Pittsburgh. Under states' driving-safety laws, the still ads must be displayed for six to 10 seconds before changing to another ad, to avoid distracting motorists. Each billboard carries about six advertisements, although some carry more.
"The market is very interested in this product. ... I think it opens up outdoor to different kinds of advertisers," Mr. Ripp says. In the past, billboards have served as more of a reminder, but digital billboards can stir up more of a "call to action." Retail clients, particularly clothing or home-improvement retailers, are giving billboards a second look because of this technology, Mr. Ripp says, as they can advertise sales and specials that have in the past gone to newspapers.
Lamar has been expanding its network of digital signs. It has added about 25 to 30 units this year and plans to double that number with 50 to 60 additional digital signs in 2006. Mr. Ripp says the company intends to double the number of digital signs every year until it has a network of 1,000 units. The digital signs cost between $250,000 and $750,000 each, depending on the size.
Companies such as Scala, IBM and Microspace Communications Corp. are helping get digital signs into diners, health clubs, arcades, bowling alleys and other locations.
This category, called "out of home," is gaining attention as typical media -- TV, radio and print -- get more expensive, said Dennis Roche, president of Zoom Media. "No one has done a first-class job of billboards in more intimate environments," he said. Zoom Media, which manages about 40,000 signs in North America, is considering making the leap into digital signs.
Dropping costs of plasma and liquid-crystal displays are making digital signage a more attractive option. Mr. Platt estimates that a two- to three-screen display system in a small store can cost about $5,000.
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