Digital signage: Dishing up a hefty ROI

ROI iconDigital menu boards dish up a hefty return on investment, according to a recent case study conducted by digital signage software provider Scala Inc.

A 2.5 percent increase in drink sales may not sound like a whopping return, but the quick-serve industry operates on very tight margins. A 2.5 percent bump can mean the difference between remaining profitable versus struggling with a restaurant operation that dishes up anemic profits.

The quick-service restaurant industry saw operating profit shrink by almost 60 percent, and operating margin sink to 4.21%, as reported in a July 2014 study. That figure reveals a new Industry low. ”On the trailing twelve months basis Net margin in 2 Q 2014 fell to 3.54%,” according to Christopher Hall, a reporter for CSI Market.

Digital displays are a proven method to bump up sales for merchants in a wide variety of industries. While it’s true the test was conducted in the European marketplace, trends in quick-serve chains are often keyed to the global economy. Most big-name restaurant chains reflect general economic conditions for two reasons: First, the scale of their operations tends to smooth out variation in regional analytics, and secondly, quick-serve restaurants are ubiquitous to U.S. culture. It’s a fairly stable target to track.

That’s why this study, even though conducted in Europe, is an accurate indicator of the effectiveness of digital signage around the world to bump up impulse purchases and contribute substantially to a firm’s branding.

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