Article
How small chains can find ROI in digital signage
As the price point becomes more affordable, one-market and regional chains are getting on board.
December 3, 2009
As the price for digital signage hardware continues to fall, more operators of small chains are committing to the technology. Unlike large chains that typically undergo years of testing and then have to sell their franchisees on the benefits, small chains can react more quickly.
Budding quick-serve chains — or even franchise operations with fewer than 20 units — can take a lesson from fast casual Becks Prime. The Houston-based steak concept is getting ready to open its 11th unit — and install its third digital menu board system.
Molly Vorhees, vice president of marketing and expansion for Becks Prime, said the chain likes the digital option for its benefits: sleek-looking panels and the opportunity to promote its specials and menu items by daypart. The chain also likes the ability to showcase its high quality food products with equally high quality photos.
"For us, the decision was pretty straightforward once the price was right," she said.
Some of the units feature a four-screen digital menu board. At least one has a fifth screen, which is used as a promotional panel to replace point-of-purchase materials.
Content for the menu boards and promotion panel is updated remotely via enterprise-level controls. Vorhees says the chain likes the new ease in changing content, especially for menu pricing. Previously, the chain raised prices only once a year because updating its conventional menu board was such a hassle, Voorhees said. As more stores add the digital boards, the chain will move to incremental price increases as needed.
"It's a painful process (to update menus), and now we can do that w a touch of a button," she said.
Becks Prime expects to retrofit three to four stores to accommodate the digital boards next year, but some of the stores might not get the new technology for years because of design complications. Fitting the four-screen units into those stores would be too costly to redesign for the new configuration. But all future stores will have the new digital boards since the chain can capitalize the expense, Vorhees said.
Additional digital menu board systems will cost the chain significantly less than the original installation, which included a one-time fee for Epicure Digital Systems to design the digital menus. The chain will charge some of that customization and creation fee to future stores.
For Becks Prime, it's an investment in the chain's future.
"It probably isn't costing us lifetime value that much more to go digital than it is our regular boards," Vorhees said. "But we can just do so much more with it that is valuable to our operation. But I can't put like a real value on that."
Complete digital menu board solution
Harvey Friedman, founder and president of Epicure, said more and more small chains are approaching his company about installing digital menu boards. Like Becks Prime, they see the return on investment — including greater flexibility and more marketing opportunities — in the systems.
Working with a digital menu board company like Epicure allows operators to purchase a complete solution — hardware, software, menu design and menu engineering. Going from a conventional menu board to a digital system isn't as easy as transferring the same content design, Friedman said. The digital system requires a new strategy because it can be used for much more than posting prices and menu items.
Menu engineering is especially helpful for small chains that don't have an advertising agency. The service helps the chain determine how to sell its products, including where to place them on the menu.
Low-end turnkey solutions
Small chains also are looking for basic turnkey systems, either for digital promotional boards or menu boards. WireSpring Technologies Inc., for example, launched a Digital Signage Easy Start solution this spring. Although the company didn't target QSRs, a number of operators have purchased the basic units as a way to test the technology, said Bill Gerba, WireSpring CEO.
The low-end players offer a less expensive way to test the technology and require no monthly fees. "It's a fire-it-and-forget-it product" that allows operators to "try it and get a gut feeling as to whether it's working for them or not," Gerba said.
POS integration
Some providers like MICROS Systems Inc. offer digital menu boards integrated with point-of-sale systems. With that integration — and enterprise level controls — operators can update their POS and menu pricing all with one click of the mouse. Becks Prime, for example, has enterprise-level controls for its POS system and digital menu boards, but the IT staff must update each system separately because they are not integrated.
David Straub, director of product management for MICROS, said the company's integrated solution is an economical and beneficial upgrade, allowing digital files to be easily deployed through sending a remote connection into the restaurants. That means quicker uptake on POS-integrated digital promotional boards as well.
"Reaction time is also cut drastically as customers no longer have to wait for printed mailings to arrive," he said. "Promotional and menu materials are displayed immediately."
MICROS, which has offered digital menu board software solutions in which operators procure their own screens, is working with a hardware provider to handle installation of the screens. The company will soon announce that partnership, which will include screens that feature a five-year maintenance and warranty agreement.
MICROS also is responding to operators' fears of offering digital-only content by building in redundancies to allow the menu boards to continue to operate in the event of a screen failure.
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