Technology at the point-of-purchase is creating a stir among marketers. Interactive touch-screens and multimedia displays may sound impressive, but what do they mean to the consumer and, more importantly, the company footing the bill for the equipment?
“The situation with touchscreen systems is that many companies are just putting their toe in the water.” says Nigel Petty, director of point of purchase specialists Evans Petty Associates.
“I can’t see there being much of a rush to commit capital expenditure to this area for five to seven years – when costs have fallen and the technology has improved. This is especially true for the fmcg sector, where interactivity has less relevance. There are areas now, however, where it might prove effective, such as in car showrooms.
“In another specialist field, financial services, one benefit is that the equipment can’t offer an opinion. In both cases the technology can be used to save the time of sales staff who can assist, as and when necessary, so that the human element is not lost.”
One of the most sophisticated interactive displays is the Vauxhall Information Centre, developed for the car manufacturer’s dealer network by Spectrum Communications.
Customers using the unit, which has recently passed the pilot stage, can call up a list of models and specifications that suit their budget. The multimedia programme can display different colours, trims and viewing angles. It is also able to show how safety features such as airbags and ABS braking systems work – something which cannot be done with a test drive.
“The ability to see cars in this way is particularly important,” says Richard Angus, special projects manager at Vauxhall.
“This is because we are stocking fewer cars on dealership premises and more at vehicle storage centres so that we can speed up delivery of a wider range of specifications,” says Angus.
Interactive systems have rarely got beyond the trial stage in UK retailing. One that has is the touch-screen system TOPSSY (Touch operated phone selection system) installed by Fords Design group at all of Peoples Phone’s 130 showrooms in the UK.
Because Peoples Phone has different telephone packages on offer it is important to find out how much its customers use the phone.
The interactive system was designed to ask a series of other questions, including whether the calls were for private or business use and what time of day most of them were made. A calculation is then made of which telephone package would best suit the customer and a print out of the information is produced. This is then taken to the sales staff for the purchase to proceed.
“The interactive unit has several advantages,” says Fords chief executive Martin Law.”It is very easy to use, and takes customers through a step-by-step process. Many people prefer to use the system because they don’t want to appear ignorant when dealing with another person. From the store’s point of view, the display can be used as a back-up when the showroom is busy. Rather than being kept waiting, the customer can use the touch-screen system, which is both fun and useful.”
Marks & Spencer is also using interactive equipment for its Wedding List service. A customer wishing to buy a present for a wedding can use the interactive unit – on trial at the Bromley store – to see a list of presents and find out which has not yet been bought. The system can then give details of cost and can confirm an order.
“We are really only at a trial stage with this type of technology,” says Martin Clarkson, executive of commercial publicity at M&S.
“It would seem to have most potential for specialised services. It would, for example, be very easy to put our Homewear catalogue onto an interactive system which would allow customers to view the products in the home environment rather than in store.”
In the North America, however, interactive technology is already being used for a wider variety of marketing applications. John Halliday, general manager for Europe at US based point-of-purchase systems specialists RTC, says: “The US has already been through the process of educating marketers in the potential of in-store multimedia technology, and use is growing very fast.”Halliday points to an installation in one of K-mart’s Canadian outlets to show how the technology can bring measurable benefits. “A terminal was set up in-store which displayed a series of coupon offers. Customers could view the coupons and, if they wanted to take advantage of the offer, they touched the screen where that coupon was displayed. This triggered a print out of the particular coupon which they can then use in the store.
The unit was linked to a central computer so that K-mart could monitor the progress and make changes to offers if necessary.
The promotion was a phenomenal success – generating a sales increase of more than 70 per cent on couponed products.”Halliday is keen to point out that touch-screens are only one of the interactive technologies coming on-stream. Most other options are cheaper. They include:
– Audio: a message can be replayed which is triggered by either someone pressing a button or activating a sensor.
– Liquid crystal displays: small LCDs, with calculator-style keypads, can be used to respond to customer queries. An example of their use might be in off-licences – where customers looking for wine can key in the type of food will accompany, their general preferences and a price range. A display of recommended bottles would then appear on the small screen.
– Laserdisc: this is effectively one stage up from the LCD system. A small TV monitor and key-pad can be clipped onto a shelf. Questions can be asked using the key-pad and a video response from a remote laser-disc is generated.
“In the US, these applications are becoming widespread and it is only a matter of time before
the technology is used on a greater scale in Europe,” says Halliday.
But there are two obstacles to growth: the cost of equipment and the concern that interactive displays are usually designed to be used by only one person at a time.
“A single touchscreen costs 600,” says Lisa Hearsum, marketing manager for dis play technology specialists AlphaServ.
“Added to this is the cost of the computer equipment and the software which needs to be kept up to date. It’s an awful lot of money to spend on a system that can only be used on a one-to-one basis.
“In most cases where we offer interactive systems it is only as part of a much bigger installation, which includes display images for the entire retail area rather than individual shoppers. One such example is a trial being run in the New York branch of Musicland (a chain of music and video retailers). This system uses a large, nine-screen video-wall which plays a loop of programmed music and video material.”
Such systems may be successful, but one has to feel for the customer who happens to like Perry Como.
One company that has chosen to avoid the interactive route at point-of-purchase is Concourse Communications. Chief executive Tony Max says: “Obvious applications, such as video catalogues where customers select detailed product information, are not cost effective. It is also very difficult to encourage supplier cost off-set through advertising because, by design, it is a one-on-one medium.”
Concourse has developed a flexible TV “narrowcast” system for retailers where programmes are screened to reflect changing patterns throughout the day.
Stategically placed TV monitors are individually sound controlled and driven from a personal computer, which stores the video programming on hard disc. Programme elements can be updated regularly by data satellite transmission.
The system is being used in large stores such as M&S, and also in airport terminals at Birmingham, Gatwick and Schiphol. At the airports, broadcasts are made which include news, a magazine-style programme using BBC and independent TV material and specially produced programming, relevant to airport viewers.
If, for example, a flight is due to leave for Japan, programming in the relevant part of the airport can be in Japanese. To pay for the system there are nine minutes per hour of advertising, which tend to be either international brand ads or productions aimed at attracting customers to the concourse shops and duty-free areas.
Such developments demonstrate that, despite all the complex technological advancements coming on-stream, the simple ideas can also be effective. Multimedia and interactive technologies are throwing up enormous possibilities.
Whether or not these have real potential in the marketing environment remains to be seen. British marketers are being cautious, perhaps wisely so, and installing the equipment either on a trial basis or where they can see a measurable benefit.