"Log Jam" of Demand Leaves Investment and Development Opportunities in Self-Service Technology/Digital Advertising
May 24, 2010
Amongst the headlines coming out of the kiosk/digital ads industries this month were “50% of Advertising Will be Digital, Says Google Exec” “UK Mobile Advertising Market Surges in 2009,” and “Advertising Giant WPP Increases Digital Ad Budget.” These headlines are being uttered by the most credible sources in the market, including IBM, Google, UK advertising giant WPP and in reference to not just North America and Europe, but Africa too. That is to say that once again, despite-at best-contrasting views of the ensuing financial markets, almost all respected industry leaders are confident about the future growth of digital advertising and its related sectors in the self-service technology market.
Far from revelations, this is nothing new and similar information has been featured in the most popular publications around the world (Wall Street Journal, The Economist, The New York Times, The Telegraph, Business Week…) for the past five years (at least). In short: it is no longer privileged information.
So, what is stopping this digital ad revolution/revenue boom?
A recent article by Lyle Bun for Digital Signage Today addressed this issue. “Even though the problem is largely hidden because the sector at large has been growing at reported 23 percent-plus compound annual growth rates (CAGR) and many suppliers are enjoying double digital growth,” states Bun, “there remains a substantial, pent-up demand of projects and purchasing, which means that intended projects are slow to move toward deployment, and build-out rate is delayed.” Very succinctly summarized, the industry is flourishing yet opportunities are slipping through the cracks as a result of slow turn around and lack of capital investment.
Bun goes on to detail the top causes of this problem as well as solutions to said challenges. For the full article, CLICK HERE
The clear corollary from this “log jam” in the digital advertising industry is its reflection in the self-service kiosk market as well. An industry intrinsically related to digital advertising (via screen ads, product placement, etc.), any lag in the digital end will clearly have its effect on kiosks as well. The link does not stop there, however, as the log jam in the kiosk industry results not just from its partial dependence on digital advertising but also its similar footing in the market and position as a well-known yet still untapped technology. Similar to the ludicrous 25% growth rate discussed by Bun, in its extensive 2009 study, respected London-based Retail Banking Research Ltd. predicted that the number of self-service kiosks would quadruple from 92,600 in 2008 to 430,000 in 2014. Until investments increase, however, companies will continue to struggle to meet the exponential demand for their products.
The good news from all of this is to the individual investor. While far from undiscovered technology, he/she can still reap the return on investment as if the technology were hot out of the gates.
For more market information and self-service kiosk/digital advertising analysis refer to IKS’ industry-leading white paper on our website:
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