Image showing an outdoor sign for business advertisements using LED technology.

Do LED Outdoor Signs for Business Work? A Comprehensive Guide

Yes, outdoor signs for business advertisements work only if you know how to make them work. That’s the quick answer to the question in the title. Just like any tool, the end result still depends on the craftsmanship of the person using the tool. Outdoor LED signs for business ads are just tools for marketing. The way you use them will heavily dictate their performance. Hence, knowing your way around marketing is key to making it work. Outdoor signs won’t market for you on its own. You have to design campaigns yourself. Read further to learn more.

How Outdoor Signs for Business Advertisements Affect Performance

Marketing is a tricky business aspect. There’s no foolproof way to perfect it or get the intended results. Even expert marketers have to face uncertainties or risks when doing marketing campaigns. In other words, marketing isn’t an exact science. There’s always variability involved in marketing. The same thing goes for using outdoor LED signs for business. There’s really no way for marketers to assess if it’s delivering its intended purpose.

Instead, we look at the whole picture. We look at the bigger figures and macros. From that perspective, we can see if the marketing campaign is working. Now, let’s discuss how outdoor LED signs affect business performance.

Increased Revenue

Revenue is the major key performance indicator in marketing campaigns. Ultimately, we ask ourselves, “is our marketing plan increasing revenue?” If not, scrap it. It’s just eating away your capital that’s better spent on revenue-generating activities. Now, how can LED signs help increase revenue?

Well, there’s no way for us to know if a sale is due to the implementation of the LED sign. Some customers may say, “I bought your product because I saw it in your outdoor display.” That’s one way of knowing if people are catching your LED display. However, in reality, not all customers are like that. Some may notice your outdoor display but not mention it to you.

Hence, we look at the bigger picture. Ask yourself, “how much revenue has come in the business after I installed outdoor LED signs for business?” That’s the only way to know, and you need to be great at crunching numbers to know. LED signs for marketing expand your reach to more potential customers, especially those who prefer visually attractive ads.

Image showing how outdoor signs for business ads can be used in promoting your products and services.
Outdoor LED Screen Showing an Advertisement

One month after you used your outdoor sign for business ads, prepare a comparative income statement for the previous and current months. Take note of the change in sales. If you want to be extremely thorough about it, look at sales information in the past 12 or 18 months. Check if there is a trend prior to your implementation of the outdoor LED signs.

Perform year-over-year analysis, which means comparing the sales of a specific month of the past and current year. For instance, let’s say that your sales for March 2023 are $67,000, which is prior to your use of outdoor LEDs. Upon checking current period data, March 2024 sales are $94,000, which is roughly 40% higher than the 2023 figures. Is that increase due to the use of outdoor LEDs? We can’t say for sure because there are a lot of variables involved.

Hence, look at past data. Look at trends that seem to go on ever since. To continue our example, let’s assume that for the past 12 months, sales growth averages at around 5% to 7% per month until February 2024. However, with the use of outdoor LEDs, March 2024 sales growth compared to the average growth is 11%. Hence, what can we derive from this information? We can say that the outdoor LED signs for business did impact revenue.

But is this increase fully attributable to the outdoor LED? No, because there’s no objective way to know. As long as we see the bigger picture and stay abreast of all variables, we can say that outdoor LED signs have a positive impact on the business.

More Customers

Placing outdoor LED signs for business ads attracts more customers coming from diverse backgrounds. If strategically placed in high-traffic areas, you can target more customers and spread awareness to different demographics. However, you can only achieve that if you know how to deliver your message and offer a good value proposition to your customers.

The message should be clear and compelling. It must appeal to your customers’ emotions or target their pain points. What do they want to hear? What word or offer can you give just to move the needle? Attracting customers through outdoor signs for business is more than just stunning visuals and attention-grabbing content.

It must be more than the visuals. To make this work, you need to brainstorm “the why” behind your customers. Why should they buy your product? If they’ll buy, why should they buy now? You can give them a sense of urgency. For instance, you can offer discounts, rebates, freebies, or exclusive deals for a limited time. When people see the words “sale,” “discount,” or “free,” you can easily grab their attention.

Image showing the famous cat on the outdoor LED sign at Shinjuku.
People Watching the Big Cat at the Famous Shinjuku LED (Source: Tokyo Cheapo)

Though you got their attention, they’re not hooked yet. Through the versatility of LED technology, you can take advantage of it to show more promo materials to customers that will further entice them to grab the deal. Since it’s just a limited-time offer, you create a sense of urgency that will make customers think and decide fast.

However, since promos are usually for a limited time only, it’s easy to remove them once the promo period is over. Using traditional posters can be difficult to retrieve, and some customers may still rely on outdated information. With LEDs, you can simply remove the old promo so that people won’t see it playing anymore on the LED screen.

Improved brand awareness

Text is boring in this generation. If your ad says, “Buy our delicious bread and get 10% off if you buy one box,” some people won’t even pay attention to it. Some would even stop reading after “bread” and move on with their life. But if you use a combination of text, images, animations, and videos, you can capture the attention of your potential customers and entice them to give your products a chance.

And you can do that only with outdoor LED signs for business. You can use it to promote daily specials, exclusive discounts, limited offers, and other unique perks. You can even use psychology to craft your promo materials. By using specific colors, tones, fonts, designs, and messaging, you can effectively reach your target market.

Some people buy on impulse alone, and they just need that one last reason before fully committing to the decision. The role of the ads and images in your outdoor LED display is to enhance brand awareness. Dynamic and engaging content helps potential customers understand your brand. On the other hand, it also keeps current customers coming back and buying your product.

Hence, investing in a high-quality outdoor sign for business ads is crucial so you can present your products in the most pleasing manner. You can also show them your logo, messaging, and tone that will resonate with them and further encourage them to learn more about your business. And ultimately, these efforts will imprint your brand into their minds, which will improve brand recognition and recall.

Outdoor LED signs can also help you communicate promotional and seasonal offers, discounted products, or special perks to current customers. It could even bring in new customers if you deliver ads in a personalized manner that resonates with their values and beliefs. Leveraging high-traffic areas is crucial to make this work. Hence, choosing your location is important. 

Communication of Actionable Information

In marketing, it’s always about the call to action. It’s the “what now?” After you’ve shown your customers reasons to buy your product via the outdoor LED screen, what are they going to do? That’s why actionable information is important as well. It’s more than just a call to action statement. It’s about guiding potential customers in the next steps.

A call to action tells the customer to commit to the purchase or to explore more about your product. Through outdoor LED signs or displays, you can provide more information, such as

  • QR codes (e.g., sharing menus, sign-up forms, website redirects, etc.);
  • Contact numbers;
  • One-pagers or quick information and;
  • Instructional videos (e.g., how to sign up or how to access the product or service).

Even with the use of interactive LEDs, you can let customers know the next steps. As a customer, it’s hard to be in a position where you don’t know what to do next. You should guide them using tools and technology that will help them figure out the next steps. Take note that you don’t need to spoonfeed your customers. All you need to do is give them enough information on what’s next, and they’re good to go.

Targeting Your Customers

Not all people are your customers. Every marketer knows that. To effectively promote your products and services, you must use marketing strategies targeting your potential customers. However, make it a point to get new customers as well. Today, marketing is shifting from traditional to digital. While traditional still work, businesses that want to remain competitive also invest in digital marketing to capture more customers. Using outdoor LED signs for business promotions can help you in targeting more customers.

In target marketing, you need to have a deep understanding of your target market. Who are your customers? Where do they live? Are they employed? What’s their income level? Are they single or married? Do they have children? These are just some questions you need to answer. Then, once you understand this, you can apply it to the kind of ads you need to show in your outdoor LEDs.

  • Personalized content: When creating specific ads and promos shown in outdoor LED signs for business, you need to personalize them so that customers can relate to them on a personal level. Understanding their likes and dislikes based on age, gender, nationality, status, and other demographics can help you personalize ads to their liking. You need to target their pain points. What do your customers want to see or hear? Can you relate this to them on a personal level? In making personalized content, you also need to consider culture, beliefs, and norms. If you want to get the trust of your customers, you need to respect them first.
  • Localized content: Aside from personalized content, you also need to make it localized. Localized content means that it takes advantage of geographical characteristics and linguistic capability. For instance, promos and ads in Korea are best shown in Korean. But if you’re promoting Korean products outside of Korea, would it still work if the ads are in Korea? Of course not because people of other nationalities won’t understand Korean. Instead, you translate it into English so that it’s localized and understandable. Aside from language, you need to resonate with the local customs and traditions. For example, a Jewish neighborhood will not appreciate it if you’re advertising pork products to them. That’s simply forbidden in their religion. Hence, acknowledging the religious sensibilities of the target market is also part of your role.

Therefore, using an outdoor LED screen is not an easy marketing stunt. You still need to assess your marketing goals and objectives, make your promotion, and captivate your market. It’s not as easy as flashing posters or videos on the LED screen.

How To Measure Success in Using Outdoor LED Screens?

Measuring the success of your outdoor LED signs for business commercials is important to know if they are delivering the best results. Unfortunately, it gets a little tricky when measuring the marketing results of outdoor LED screens. If you’re a small business, you must rely on your marketing ad and trust that it will deliver the message. But if you want to be in the game, here are some suggestions on how you can measure the marketing success of outdoor LED screens.

Measuring Impressions

Impressions are the number of times an advertisement is shown to target individuals. In digital marketing, impressions can help you determine the market size. However, it’s not the ultimate measure of market size. For outdoor LED signs, it can be quite challenging to measure impressions. It requires additional investment or cash outflow to track it. Here are some ways you can measure impressions for outdoor LED ads:

  • Installing traffic counters that can auto-detect the number of people passing can help you determine the volume of people in that area. However, traffic counters can’t say if the person saw the advertisement. It’s possible that it just detected the person and counted it as an impression.
  • Video cameras are also an advanced way of measuring impressions. Through video analytics, you can analyze footage, detect people, and measure how long a person stayed to see the ad. But this could pose privacy concerns, and some people won’t like it if they’re being recorded or tracked. Hence, be careful when using this approach.
  • You can hire service providers specializing in advertising metrics. These companies have way more capital and resources to pull off different kinds of advertisement tracking that might not be accessible to you. However, these service providers may be costly, so you need to prepare additional money for the fees or contract retention.
  • Hiring manual trackers is a possibility, but the total count heavily relies on the performance of the person hired to do it. If they’re slacking off, they won’t capture the actual impressions and may even provide you with wrong data. Hence, be careful when using this approach as well. It’s not the most accurate.

Measuring Reach

Reach is the number of users who paid attention to your ad. You can say that they’re the people who spared a few moments of their time just to watch the advertisement being played on the outdoor LED signs. Measuring reach can also be tricky, but it can be a lot easier than making impressions. To measure reach, you employ the following methods:

  • Surveys are great tools for measuring reach. However, statistical knowledge is required to determine if ads are well-received entirely. To yield the best results, it’s best to hire a company that can do these kinds of surveys. They have statisticians and data scientists who can provide expert opinions regarding the results of the survey.
  • Interviews can also be a good way to measure reach. By talking to people and asking them about your business, you can also gather suggestions or promote your business in case they’re not aware. The downside is that you may not capture the right sample size to arrive at an objective conclusion.
  • Geofencing can also work to measure reach. In this day and age, when someone sees an ad, it’s kind of an instinct to check more about the business on social media or in the search engine. Through geofencing, you can easily capture searches or activities relating to your brand or product.

Computing Marketing ROI

Reach and impressions are for the nerds, some might say. However, the real measure of success is the return on investment or ROI. In fact, there’s some truth to that. Impressions and reach are just indications of possible success. More impressions and reach may result in higher chances of success, but it’s never the final figure.

The marketing ROI is the metric used to determine if the marketing campaign yields the required rate of return. It is a profitability measure that helps decision-makers decide whether to continue or discontinue the marketing campaign. It is also a metric used to determine whether more capital is needed for marketing, especially if it’s generating significant returns.

The Marketing ROI is computed as:

ROI = (Net Profit from Marketing – Marketing Cost) / Marketing Cost x 100%

Let’s discuss the variables in the equation:

  • Marketing cost is the amount spent on the marketing campaign, from planning to executing the campaign. It also includes other purchases made to support the campaign. The cost of the outdoor LED signs is not included here.
  • Net profit from marketing is the net revenue earned from marketing activities net of directly attributable costs. Directly attributable costs include costs needed to run the campaign, which excludes the salary of marketing personnel and talent fees of models used.

For example, let’s assume the following information:

  • Net profit from marketing: $12,000
  • Marketing Cost: $9,000

ROI = ($12,000 – $11,000) / $11,000 x 100%

ROI = 9.09%

Interpretation of Marketing ROI

Marketing ROI can be positive or negative. A positive ROI means the results are favorable, while a negative ROI means unfavorable. However, a positive marketing ROI for outdoor LED signs or screens is not the ultimate basis. Having a positive ROI doesn’t automatically mean that the marketing campaign is working. You still have to compare with your desired ROI.

For example, let’s assume that the marketing ROI is 5.2%. Management expects an ROI of 11% for the marketing campaign. While 5.2% is positive, it’s still not good because management expects 11% ROI. However, let’s say the ROI is 10.5%. Is it still bad? Well, that depends on how you see things. For some, it’s only 0.5 points away from 11%, and it’s commendable, given that it’s very near the goal.

However, you still want to review your marketing campaign. Can we still push the limit? Can we still change something to take home the 0.5 points? In interpreting the ROI, the cost of the LED signs is often not considered because it’s already a sunk cost. However, you may want to compute its payback period or the number of months (or years) that would take before you recover the initial investment.

Importance of Measuring Success of Outdoor LED Signs

By using some of the techniques above, we can use the numbers to make decisions. Here are some questions to ask yourself on how measuring the success of outdoor LEDs can help you make a guided decision.

  • If the ROI is high, is there a need to invest in more outdoor LEDs? Should we buy more outdoor LED signs for businesses to sell on the market? Can we make our ads more targeted?
  • If the ROI is low, why are we still investing in outdoor LED signs? How long can we recover our investment in this state?
  • If impressions are high, what can we do to harness its potential? What other ways can we explore to convert them into customers?
  • If the reach is high, how can we further drive potential customers down the funnel? How can we keep them engaged until they buy our products? Can outdoor signs for business ads help customers know about your products?
  • For marketing teams, how can we improve the performance of the marketing department? Do we need to hire more experts to improve overall performance?
  • For management, how much more capital can we allocate, given the ROI and other performance metrics? Is management fully committed to marketing, or are they just seeing it as a necessary evil? What are the outdoor LED signs for business cost considerations?

Conclusion

Outdoor LED signs for business advertisements can help you gain more customers, engagements, and revenue. However, it’s up to your marketing team to do the hard work. Hence, investing in outdoor LED signs can be worth it if you know how to leverage its capabilities.

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