Meet Our Partners – Watchfire Signs

Full Video Interview:

Full Transcription Here:

Intro to Watchfire Signs with Chris McGary

Bob Norman, Guthman Signs:

Hi, everybody. Welcome back to Meet Our Partners, the series that we’re using to kind of get up close and personal with our vendors, our factory partners that we use all the time. The goal of this, obviously, to provide some more exposure from our factories, so you’d be able to talk directly to our customers when otherwise you might not be able to. So, today we’re doing Watchfire, one of our favorite companies out there that make awesome displays. This is Chris McGary from Watchfire, he’s been in the sign industry for over 15 years now, knows his stuff, so that’s why we invited him on. Hi, Chris.

Chris McGary, Watchfire Signs:

Hey, Bob. Thank you very much for having me. Truly enjoy working with Guthman Signs and yourself, and I’m a big believer and enthusiast in LED Signage and what it can do for the end-users.

Bob Norman, Guthman Signs:

Of course, yeah. So, I guess we could start off with the basics, dive right in. Who’s Watchfire? What makes Watchfire different?

Chris McGary, Watchfire Signs:

Okay. Well, Watchfire has an 87-year history, and it’s one of a lot of consistency, because basically when you really pare down our product and the service and our customer base, we’ve been doing the same thing for 87 years. You may say, “Well, how’s that possible if LED signs haven’t been around for 87 years?” Which is true, but we got our start selling animated sign products. It was called Chaser Technology. So you see old pictures of neon signs that had motion, or movie marquees with colored light bulbs that go in a pattern. That was the technology that we sold.

Even back then, we sold the product through the sales channel we still use today through our reseller partners’ sign companies. So, over the years, the product has changed its appearance from time and temp units to bold message centers, to red message centers, single color to full color indoor and outdoor displays now. It’s always been the same thing through the same resellers. I think a big part of that is, we understand that our reseller partner is our customer, not the end-user and how that impacts the sale and customer support in the end.

I got into signs in 2002 up in the Florida Panhandle. It was very small sign company and had a couple sales that were almost a hundred thousand dollars and I thought I’d died and went to heaven. They were Watchfire signs and they were red monochrome signs, to a restaurant, to a beach store.

What really got me excited besides the price tag was the fact that the end-users rave to me about how much it helped their business. And I thought, “You know what? This could be big.” So I proceeded to try to sell a few more signs and found out that Watchfire was not the most inexpensive brand out there. One of the hotel owners gave me a quote of my competitor and I called him up and the guy told me about all the great signs he had sold, wanted me to meet him in Orlando. I went down and met him and was amazed. These big, full-color signs. And I thought, “Hey, I can do this in my own backyard.” Without giving you all the detail, I went through several different brands and several different heartaches and ended up coming back to Watchfire and having a good experience.

So, I think when you talk about what Watchfire is, and what makes us different. There’s a lot of people you can buy LED signs from out there and they all have varying degrees of quality. Obviously, I’m biased. I think we’re the best, but there’s a lot of people out there that have some signs that look good, that are somewhat reliable, that have customer support. But most of the time when you do your examination and you really look under the hood, they’re lacking somewhere. If they have a good customer service, then maybe the warranty isn’t really what you’re looking for. Maybe the sign doesn’t last quite as long, maybe the diodes aren’t the top grade. I really feel like the best thing about Watchfire is when you buy a Watchfire sign, you’re really guaranteed success.

If we’ve got a problem with the sign, we take care of it. Our dealer Guthman Signs helps us do that. You’re our boots on the ground, but we take care of problems. We take care of them promptly. There’s people out there that have their warranties that are taken care of through insurance companies. Seven years, six years, whatever the term, being able to get a part is one thing. But if it takes you two weeks to get it or months to get it, you’re not going to be very happy. I mean, one thing that I learned about these LED signs, Bob, was the customers always underestimate how much they help their business. As a result of that, they underestimate the frustration they’re going to have if it’s hard to program, if the communication system goes down and it’s the middle of January and their signs saying Merry Christmas, it’s embarrassing. It doesn’t look good.

Bob Norman, Guthman Signs:

So now we know the history of Watchfire. That’s a lot of years. You learn a few things during those many years. Like you said, we got to look under the hood to see the differences and understand more. So, looks like you have something there for us to describe for us. Thank you.

Chris McGary, Watchfire Signs:

Yeah. So, in our factory, in Danville, Illinois, which is where we’ve been for over 85 years, we employ over 350 people. I think one of the things that really sets us apart is the fact that we conceive, develop, engineer, test, manufacture, market, and service our digital products all from one facility. So, if engineering is looking at developing brightness in a six millimeter SMD product, they can build the product, test the product, and revise the product all under one roof, under real conditions. We have a testing lab with accelerated failure testing that we can use, customer service.

If one of our customers has a module go out on a board and they see a problem, two or three signs are having the same problem, service can go to engineering, they can pull the batch number and look at the test results from those and troubleshoot and see if there is something that was missed. Hopefully, there wasn’t, but all that data and all the people all the way through the manufacturing product process and the service design engineering is all under one roof. Engineering is all in one section. So they have meetings, they’ve got their product development and everything is… There’s a lot of synergy developed from this. We’re not subcontracting things out and not understanding what we’re getting. So, that really helps a lot.

The other thing is, we’ve got all the records, we’ve got over 65,000 signs installed across the country. Every one of those signs has a history that they can go back and look at to check and see if there’s an abnormal issue, or if they make a change in manufacturing, does that increase the longevity of the product? Does that improve the product? So, in my mind, that’s a big differentiator. The other thing is, you’ve been to our factory, it’s a great place to bring our reseller partners to understand our business and see how it’s done. You get to be more of an expert and much more confident in the product we provide.

What Makes an LED Sign Display from Watchfire Last So Long?

Bob Norman, Guthman Signs:

I do hear a lot, you’ve mentioned I think three or four times, the word long longevity is big with Watchfire obviously. What makes an LED sign from Watchfire last longer? I guess that’s the most simple way I can ask that.

Chris McGary, Watchfire Signs:

So, we make digital signs. That’s fairly well established, but the key component of any digital sign, whether it’s a Watchfire, an imported brand or Brand X or modules, this is the fundamental building block of the sign. It’s got your diodes on the front and that’s a very important, the biggest cost factor of the sign. But the real longevity is in the engineering. I’ve put one of our main competitor’s modules on one side, and I’ve put ours on the other. I’ve got some arrows highlighting some of the key components. One, you can see the matte… I guess I would call it matte clear finish that encapsulates all the electronics on our module. That is a Silicon gel encapsulation. It’s about an eighth of an inch thick.

We go to the sign shows. We get teased a lot because we’ve put this in a fish tank and run it, and nobody runs times underwater. It’s theatrics. But the point is, it’s weatherproof. We’re here in Florida, I know you sell signs all over the world and we do as well. But the Florida market is in fact, one of the harshest between hurricanes, heat, humidity… Nothing messes LED signs up like corrosion. So, one of the biggest building blocks, one of the biggest things we do is the Silicon encapsulation. Keeps all the moisture off the electronics and eliminates a lot of problems that way.

If you see the arrow going to the middle, there’s a little black square on there. That is an integrated circuit, a little microchip. What that chip does is several things. One, it does some of the control at the module level, whether it cause to color blending, brightness, starting and stopping. Each module has some control on itself. It’s not just getting data from the controller that runs the entire sign. So we’re not sending as much data across the sign as some of the competitors. Which allows… If you see the two receptacles up above the IC chip, there’re Molex outdoor rated connections from our data. These basically you can see they’re outdoor rated. Those are weatherproof connections. Only nine connection points per module.

When you go to the right, you see that module, and at the top and bottom, you see ribbon connections. 20 connections coming in 20 connections going out. 40 in all. That’s that’s 40 potential failure points. One is not really outdoor rated, but there’s just so many connections. There’s a lot more opportunity for failure and moisture to get in there. It’s not encapsulated. All your resistors and solder joints and whatnot are going to be exposed to the weather.

A lot of people say, “Well this is inside the sign. It’s not in the weather,” but I mean, you still have ventilation and air flow through the cabinet. We know if it’s 95% humidity, there’s going to be moisture in there. The power connection, you see it’s an exposed connection compared to the Molex connections that we’re using.

The other thing that the smart module with the IC chip does is, allows us to do remote diagnostics on the sign. Our billboard… Brethren we’re the largest domestic billboard supplier in the United States. That allows for remote diagnostics. Our tech support can go through a wireless broadband communication and run diagnostics on the sign, either next day or second day, a power supply or a module or whatever it is and our dealer partner is going out to do a part replacement, not tear the sign apart to diagnose the problem to order parts and come back a second time. So there’s a lot that goes into it, but this is one of the big factors. These are the building blocks. Doesn’t matter what kind of cabinet you have, what kind of controller you have. If you don’t have a good module, you’re going to have a lot more problems.

One other thing why we have good longevity is, if we need a part replaced during the warranty or after the warranty, the module you get is from the same manufacturing batch as the original sign. So we may have to tweak the brightness a little bit if it’s an older sign, but the color here, the color palette will match up and you won’t get the tiling effect that you see on some of the LED signs.

Bob Norman, Guthman Signs:

Can you describe tiling? That’s an industry term I’m thinking people might not understand that it’s important.

Chris McGary, Watchfire Signs:

Yeah. They say tiling, they say quilting, but basically what it is, if you have like colors on a sign… We have square modules. Some people have different sizes, but basically, you can see differentiation between the modules where the brightness or the colors don’t match exactly. It doesn’t look good, detracts from the sign.

How Does Watchfire Provide Customer Support?

Bob Norman, Guthman Signs:

So the question is, what actually makes the sign last longer? Not just that. What makes Watchfire service a little bit different?

Chris McGary, Watchfire Signs:

Another big factor would be tech service. Like I said, we’ve got a very high quality product, but there is a time when you need service and your customers, the end users, are not going to be patient because the sign makes them money and they want it back up and go on. We pay shipping on our parts. We don’t ask to get a part. Some people… You have a certain failure rate you’ve got to hit before you can get a new module. Some people you actually have to ship a module there and having them repair that. We’re shipping replacement parts, next day, second day. You will definitely, if you have to service a Watchfire sign, an LED sign, nobody is going to take care of an issue faster than we will.

There’s 15 people on a phone bank. If the call answer rate dips below 93% in five minutes, we add somebody. That’s how we determine when we need to have more help. These people are experts. They’re not reading an owner’s manual and having you try to turn it on and off. They know what they’re doing and our dealers really appreciate what they do for sure.

Bob Norman, Guthman Signs:

Yeah and by default, the customer experience becomes better.

What Mistakes Can Clients Avoid?

Bob Norman, Guthman Signs:

After people look at Watchfire and they’re looking at other options, like most people do, what would the mistakes be that they might make in that process that you could help them avoid?

Chris McGary, Watchfire Signs:

Well, we get it all the time, Watchfire is the expensive brand. Like I’d tried to explain in the beginning, we’re not perfect, but if we do have a problem, we take care of it in a timely manner. The end user has a good experience. We’ve got the unlimited software support, unlimited tech service via the phone, if not in person. So when you look at the other alternatives out there, I think that it’s hard. What you don’t want to take as an answer is just as good as Watchfire. Look at the software, make sure that you’re comfortable with that. I mean, this is probably as expensive or more expensive than last car somebody bought. They went to a dealership, they test drove it, they looked at different options, there wasn’t any question about that.

The other thing is look at some signs out there. They may not be possible with some other 2002, 2003, but talk to some customers. I mean, one of the nice things that I like to use as references, is people that have bought multiple signs over multiple years. I think it’s okay if I say this, Sonny’s BBQ franchise here in Florida has bought 15 signs from us over five years. If they were having problems with the first sign, they wouldn’t buy the second one, if they had problems with the sixth sign… People can give you one reference sign, but if you find somebody that’s bought multiples, I think that’s a great reference point to be able to use.

But just look at it very closely. It’s the law of economics, things are priced where they think they need to be to create value. I think one of the things that a lot of people mistakenly do is, there’s a lot of risk aversion to these LED signs because people are scared because they see some that don’t work or they see one in front of a business that doesn’t work. There’s two ways to minimize risk. One is, spend less money and two is be sure of what you’re doing. So I like to take the be sure what you’re doing approach myself.

Bob Norman, Guthman Signs:

Well, we do too, for sure. I wanted to add one thing to that note though, that’s super important to go look out. We always recommend people, if they have a question they’re looking at two or three different brands, if we can at all, we’ll send them a local list of signs in their area they can go look at from those factors, when and if available. I think an important part of that is to ask if possible, find out how long that sign has been installed too. Does it fit a Watchfire or Daktronics or a Cirrus or a Vantage, or a lot, a lot, a lot, XYZ, whatever company you want to name.

If it’s been out there for 20 years, it’s going to look bad. If it’s been out there for a year and it looks bad, that’s a different story. Right? So those are variables that longer term signs… They can definitely tell you the story of what a factory is capable of. At least give you an inkling. Products, change. People are [inaudible 00:23:15] days, but it’ll at least give you a better idea than if you went in blind and… The reason why I’m bringing this up and harping on it is because I’ve heard too many times. I think it’s typically smaller signs companies that do this, maybe smaller local companies, even they don’t do a lot of LED signs. So they send people to the first one that they know that’s near them. They always send them to the one that’s a couple of years old. The one that’s still looking awesome and they know it looks awesome. So they’re going to send you there. I would ask for examples more than one and ask how long they’ve been out there. That’s all.

How Does Watchfire’s Software Work?

Bob Norman, Guthman Signs:

So we get the question all the time about software. How am I going to operate this thing? Is it difficult? Is it easy? Do I have to take a bunch of training? How much is this going to clog up my day to day life? As a business, church, school, municipality, whoever it is. Literally, everybody is worried about that. They don’t want to complicate their life with a new sign. They want it to make their life easier. So, how important is software? Obviously, it’s important, but maybe people don’t understand why and how it’s important as it pertains to LED signs. So I thought I’d asked you that.

Chris McGary, Watchfire Signs:

Okay. Alright. Well, I use the software a lot, so I probably think it’s easier to use than it is. I hate when people have four or five people controlling a sign. I mean, if it’s a church or a school, maybe that’s different, but for somebody who’s primary business, I think you really want somebody dedicated. If somebody is in charge of putting content on the sign, they will take pride in that. If it’s not their responsibility, it’ll be a nuisance. If it’s a nuisance to somebody, I don’t care how good the software is, you’ll know it’s a problem because they won’t have good contempt. There are lot of tools in the software. I’d definitely do anything in my power to avoid somebody buying a Monochrome Sign.

I mean texts and we’re in a digital world, whether it’s your phone, your computer, your television, you want pictures and graphics and texts on your sign to attract customers or parishioners or whatever you’re you’re looking to do. The more you change with the scheduling aspect of our software, or most of the softwares out there, you can program your sign ahead of time for 4th of July, and then July 5th, that will drop off the sign. You don’t have to continually logging on to the sign, changing the messages. You can add something once or change a schedule once and it will automatically take care of itself. You definitely want to… For advanced users that are creating content third party graphics, you’re really only using the software to set the schedule. I mean, if you have a very good designer that is going to create content in the right format, in the right pixel count, all you’re doing is adding an image and saying when you want it to play.

If you don’t have somebody with those skills, you want to make sure the software has some cropping and scaling abilities because it’s very easy, somebody could take a picture with their phone of a cute dog at the vet and put that picture up on the sign when the owner comes back… And it should be easy. And it is, with our product. But I mean, it’s just the cutting and cropping text box… It’s got to be user-friendly like that, and it’s got to have scheduling capabilities and you’ve got to have somebody that it’s their vested interest to keep the sign running and running good.

Several years ago, I had a subway restaurant call me up and they were very disappointed because they put 241 six inch sub add up and didn’t sell any more subs. As much as I wanted to call him a liar on the phone, I knew there was something I was missing. So I said, “Next time I’m there. I’ll give you a call and we’ll take a look at it.” Next week I went in and it was a two foot by seven foot sign that had like six lines of tiny text on it that you could read. I was like, “Okay, I believe you didn’t steal any six inch stuff with that. Nobody can read it.” So, the more you change the sign, the better results you get, the better results you get… Not to sound corny about it, if the person is interested and has some skills, I think it can actually be kind of fun.

One thing that we had done that has been a nice advancement for us, is we had a PC-based software, which was our OP software. Then we had our cloud-based software, which was OPX. Sometimes people would get confused because they were both… Your connectivity was through wireless broadband. In other words, there’s a cell modem on the sign and all you need is an internet connection either for the PC or for any device if you’re going to the cloud. The OP was a little more remedial in a sense that you could take a picture and load it on there through various means. But with the OPX software now, it’s got a message editor built in and with that, the people that aren’t doing third-party graphics and illustrator or different formats can actually create content in there. So, we’re pushing more and more people to the cloud now.

How Can Watchfire Help Clients Learn More?

Bob Norman, Guthman Signs:

So aside from, obviously, providing tons of information like you have today to help in the buyer’s journey to kind of figure out what they should be looking at, things they should watch out for et cetera. What other ways can and does Watchfire support the end user in that kind of journey to help them understand and find new ways to kind of figure out what to do in this debacle. They’re looking at sometimes five, six different options.

Chris McGary, Watchfire Signs:

Yeah, it can be a very overwhelming process. I know it’s overwhelming. You can see the confusion. Sometimes we go meet with customers and they’ll say, “Oh, well, you don’t use that encapsulation. Do you? That leads to overheating.” And you’re like, “Okay.” But the thing of it is, no matter what brand they buy, it’s going to be an expensive sign. It helps everybody involved in the process. The better idea they have of what they’re getting… In any sale process, you want your customer’s expectations to be in line with what they’re getting. If they think they’re getting… Well, I guess if they think they want to get the most for their money, but they don’t want to be surprised. If they’re getting more than they think they’re getting, it’s a good thing, but if they’re getting less, that’s not a good thing.

One of the things that we started doing and I thought that it was more dealer support in the beginning, but I think it’s really more end user support. We do have demo trucks and basically, we will go out and show the customer examples. I’ll get on their website or their Facebook page and take some of the pictures and some of the ads that they’ve done and put those on a 10 millimeter or different resolutions and let them see those. Do you like the way this looks? Is this good enough resolution? Do you need a higher resolution? Show them the software. Help them explain… Show them the module like I showed earlier so that they see, “Hey, this is different. This is better.” Show them a traffic count that.

We did a sign in Orlando, I did one with the dealer and they wanted to do all building signs and we showed them a traffic count and said, “You got 72,000 cars a day driving by here. Building signs are nice, but you want a road sign with a message center, blast, and your advertisements’ on that.” We took the price and divided it over. I mean, I’ll tell you exactly what it was. It was a $150,000 sign. There was a lot of trepidation there, as you can imagine. We amortize that out over 60 months, and it was 2,500 a month about the cost of a billboard ad, $83 a day.

Their business model was… A typical customer was going to spend $200. So they got this monstrous sign for $83 a day to get people to come in and spend $200. When you can demonstrate things like that and let them understand the value that they’re getting, let them see the quality of the sign, the resolution, the software, it makes it a better process. The customer feels better about it. It’s just good. It’s good for everybody involved. Even if they don’t buy a sign from us, you know what, they’re not going to be one of those people that think that they found a gold nugget on the internet that nobody else knows about.

How To Measure An LED Sign’s Impact?

Bob Norman, Guthman Signs:

How do I find out what the impact is going to be of the sign on my business, school, church, whatever. What are the variables or what are the ways that they can look at their future and kind of pick out the crystal ball and say, “Once I have the sign up, these are the numbers that I’m working with, or this is how it works.” I know it has to do with traffic obviously, but you guys got that kind of down to a science from what I understand. So I wanted to get you to give just a brief overview of that. So people understand how it’s done.

Chris McGary, Watchfire Signs:

Yeah. Several years ago, the SBA did a study and I don’t really use it a lot because I actually thought it sounded too good. But they said that LED signs if used properly, would improve sales for business by 10% or 15%. I think I’d feel very comfortable with 10%. Typically, if you improve somebody’s business 10%, the ROI is going to be about nine months. We see a lot of ROIs under a year. So that’s good. But I think helping them understand the cost per month, cost per day, will… Back to a different subway guy. I’m not a big subway.

But one of the ones we sold, the guy figured out his cost per day was… It was $17. He was going to lease the sign for $500 a month. So it’s about $17 a day. He’s like, “$17 a day!” I forget what the number, he said, how many lunches or sandwiches, but it wasn’t very much. He’d have it covered before halfway pointed lunch every day. So that’s one of the things. But 10%, if a restaurant’s doing a million and a half, 10%! $150,000! I mean, I don’t know what their margin is, but there’s at the end of the day, Bob, there’s a reason you see all these signs out there.

Bob Norman, Guthman Signs:

Right. Right.

Chris McGary, Watchfire Signs:

Radio, TV, newspaper, those forms of advertising just don’t really work as much. You look at online advertising, that’s expensive, but most businesses are very particular about where they set up. If they’re going to rely on traffic, people coming in off the street and after all this time, it amazes me still today, how business will be there for 25 years and they put an LED sign up and somebody walks in and says, “Oh, how long have you been here?” Frankly, the owners actually get upset. For a long time.

Bob Norman, Guthman Signs:

Right. Right. Of course. They’re like, “We’ve been here forever.” What I don’t hear though, on the other side of that, what we don’t hear, I can only speak for what we’ve seen and heard, but we’ve never heard of a company, church, school, municipality doesn’t matter the sector really, if someone has owned an LED sign for their organization, they don’t go backwards. You know what I mean? They don’t go backwards to just a regular old panel sign or something like that. If anything, they upgrade, they go to a higher definition, full color, whatever, maybe larger, [crosstalk 00:38:04]

Chris McGary, Watchfire Signs:

Well, we actually have an upgrade program that helps offset the price. If somebody has gotten bitten by a poor quality sign, or if they just have an old monochrome sign, that’s worn out. So I think in Florida last year… I want to say between 25 and 30% of our sales was replacement signs. Although some of the people have some remorse and they’re not happy that they’re signed, doesn’t look good anymore, they spent money. They always say, “Well, while the sign worked, it got us more business.” So like you said, nobody questions whether it’s going to help or not.

Bob Norman, Guthman Signs:

Right. Right. I think that’s helpful because so many people hear the one-off stories. Everyone’s got a success story for their product. So the question is just, what are you going to pick? And how? And why? Then I think we’ve answered a lot of those questions today. So really do appreciate your time, Chris, if there’s anything that you would like to say or add to the kind of send us home, let us know.

Chris McGary, Watchfire Signs:

No, I guess in closing, all I would say is, there’s a lot of options out there. They all work. There’s a range of the effectiveness and it just do the due diligence, like I said, and make sure the expectation is in line with what they’re actually going to get. The on-premise LED advertising works. No question.


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