Demonstrable ROI for DS

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Ruth Rushworth spoke to Barry Salzman about how YCD Multimedia is helping marketers to measure the impact of digital media, bringing many of the advantages of online advertising to bricks-and-mortar retailers.
 
Barry Salzman, CEO of YCD Multimedia, is an experienced digital media executive and early pioneer in the internet advertising industry. Prior to YCD Multimedia, Salzman was the driving force in turning DoubleClick, the digital advertising services and technology provider, into a global leader before its acquisition by Google for $3.1 billion in 1997.
 
DS EUROPE: Could you give me a general overview of where YCD Multimedia comes from?

Barry Salzman: We were originally an Israeli company, but we’ve since moved across the globe through Europe to America. Because we were based in Israel, we have been able to take advantage of the extraordinary technology that has emerged in Israel in the past 15 years. Since 1999, we have worked with over 1,200 customers, in the retail, hospitality, banking and automotive industries, including Toyota, Kodak, Hilton Hotels, Cartier, Giorgio Armani, Motorola and Hugo Boss.

DSE: What approach have you taken to the digital signage industry?

BS: At YCD Multimedia, we have one clear mandate: to help retailers and other consumer-facing businesses be more successful. Our business model is based on installing pilot tests to trial content, and then by looking at the analytics we gather we show a ROI. When installing digital signage, we focus on the fact that digital signage can produce a measurable, quantifiable ROI. The crux of digital signage for us is about achieving this media measurement and accountability. It is the combination of personalised targeting, customer interactivity and real-time flexibility that have made digital signage such a popular and successful medium. These are attributes which had never before been available for in-store marketing, but had previously been the exclusive domain of online retailers. Today, the excitement about digital media feels very much like how people used to feel about the internet when it first got going. People sense that there’s a lot of potential in on-site digital media.

DSE: So has the digital sign become a tool for the high street store to share the advantages of the online shopping experience?

BS: There is an unequivocal link between the internet and digital signage. The internet created unprecedented marketing opportunities, which digital media has since commandeered. Both the internet and digital signage benefit from dynamic content delivery, relevant promotions, targetability and measurement. Today, these digital marketing tools of the internet are also available in-store. Digital signage has a lot to thank the internet for, least of all the improvements in both bandwidth and connectivity that has enabled the digitisation and display of content in-store. The overlap between digital media online and in-store also enables retailers to create a more consistent customer experience across these media platforms.

DSE: So you don’t see a conflict between the internet and more traditional high street stores?

BS: No, I don’t. The internet can never replace the in-store experience, and it certainly has a finite role to play in retail. Shopping is still a social activity, and people will always want to try a product before they buy it. I think what we are seeing is a  continuation of media convergence trends. The trend spotting research firm Trendwatching has tagged online influence in the offline world as a major business and consumer trend to watch out for in the near future. Long before Trendwatching  identified this, we have already been applying the tenants of online marketing to offline in the onsite digital media market. Not only have we set this trend in this industry, but we have changed the perception of the digital signage market in this respect.
 
DSE: I’d like to talk to you a little about your recent pilot installation with Dunkin’ Donuts. This project uses facial recognition technology to target customers according to their demographics. Do you think that people perceive the use of this biometric technology as slightly sinister?

BS: Loyalty card programmes demonstrate the contrary, don’t they? Because loyalty cards prove that customers are happy with retailers knowing details like when they are coming into store and what they are buying. If customers can perceive the benefits of sharing information, in that the retailer is able to deliver more value to them, then they are willing to share personal information.

DSE: This specific installation was made in a fast food environment. Do you think digital signage is more suited to fast food outlets than more up-market restaurants?

BS: There is a very strong case for the application of digital media in quick service restaurants, because customer decisions in these outlets are made at the point of sale. However, it is important to understand that digital signage is not limited to these kinds of restaurants. In projects like our collaboration with Sushi Samba’s bar and restaurant, digital signage was used not to drive sales, but to create a mood. A combination of music and video screens was used to create an ambience that helped to immerse the customer in the energy of the restaurant’s fusion of Japanese, Brazilian and Peruvian cultures.

DSE: Finally, how do you see the North American market growing in the digital signage industry as compared to the Israeli and European markets?

BS: It’s still early days to say, but we can tell that the main difference is one of scale. The North American market tends to have larger roll outs of digital signs, whereas this is usually more localised in Europe. There is a massive potential for growth across all of these markets. Current marketing research indicates that by 2012, over 90% of retail businesses in the US will have in-store digital capacity. Our recent expansion to America has increased our business dramatically.
 
Case Study: Dunkin' Donuts

YCD Multimedia has recently carried out a pilot test of its onsite digital media applications in Dunkin’ Donuts stores in Buffalo, New York. Designed to drive increased revenue and profitability, digital signs remotely deliver and manage targeted promotions and offers located at the point-of-decision. YCD Multimedia also provides detailed analysis of real-time transaction data, facilitating the modification of promotion advertising in real-time, based on actual sales data of special offers. This allows Dunkin’ Donuts to assess how successful various advertising campaigns are based on corresponding sales figures. Data from this trial is expected before the end of this year. Performance-focused creative content means advertising is always relevantly targeted to the audience in-store. The strategic objectives of the pilot were to drive awareness of Dunkin’ Donuts healthier menu offering, increase sales of the new ‘Oven Toasted’ menu, promote Dunkin’ Donuts coffee and communicate Dunkin’ Deals.
 
By assessing these objectives and each of Dunkin’ Donuts stores’ individual characteristics of location, size and in-store customer behaviour, YCD Multimedia was able to install highly targeted advertising. The facial recognition system is able to scan the customer’s face so that the digital sign then plays an advertisement that is targeted to that customer’s age, gender and demographics. These stores already have a system in place that means that when a customer buys something, they are faced with advertising which suggests other suitable purchases to them. Buying a coffee? Why not pick up a muffin too.