Digital signage is in simple terms, content and messages displayed on an electronic screen, or digital sign, which can be changed without modification to the physical sign, typically with the goal of delivering targeted messages to specific locations at specific times.

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1. Information - examples include flight information in airports and wait-times for the next train 
2. Advertising Related to the Location to Uplift Sales - examples include in-store promotions in a retail establishment
   

Advertising by Third Parties - examples include restaurant-based digital signage networks that sell advertising to local merchants/service providers and national advertisers

Enhanced Customer Experience - examples include digital signage in restaurant waiting areas to reduce perceived wait-time and recipe demonstrations in food stores

Influencing Customer Behavior - examples include post office digital signage that directs patrons waiting in line to automated stamp machines and retail digital signage designed to direct customers to different areas of the store, increasing the time spent on the store premises (dwell time)

Brand Building - examples include Niketown stores where digital signage in video form is used as a part of the store décor to build a story around the brand

Content scheduling and playback can be controlled by a number of technologies ranging from simple, non-networked media players that can output basic loops of MPEG-2 video to complex, N-tier player networks that offer control over many displays in many venues from a single location. The former is ideal for small groups of displays that can be updated via sneaker net, while the latter allows Digital Signage Network Operators to either push content to many players at once or have each player pull content from a server as needed.

Rapidly-dropping prices for large plasma and LCD screens and wide availability of Internet connectivity have caused digital signage deployments to gain in popularity, and displays can now be found in such diverse locations as retail outlets, transit hubs (like airports or bus stations), doctor's offices, fast food restaurants and even petrol stations.

While the term "digital signage" has taken hold throughout North America, in Europe the same technology is often referred to as Narrowcasting or Narrowcast networks, while some companies in the UK prefer ScreenMedia or "Digital Media Networks" or in some cases "Captive Audience Networks", or "CANs". The large number of terms that have emerged to describe the nascent industry led Point of Purchase Advertising International (POPAI) to form a digital signage standards group in 2005. This group is currently tasked with assembling a list of standard terminology for describing digital signage technology and business models. It is expected to release a final list of its recommendations in 2006.