After several years of clinical austerity, the aisles of multiple retailers have begun to feature point-of-purchase advertising once again. Keen to promote grocery shopping as a leisure activity rather than a chore, the major players are becoming more adventurous with other brands and own-label at the critical juncture where shopping decisions are made: around the supermarket shelf.
Graham Griffiths, general manager of Promotional Campaigns Group, believes this trend is the result of retailers coming under increasing competitive pressure.
He says: “In the Seventies and Eighties, the amount of point-of-sale material in stores made them look like bazaars – and this was when retailers wanted to start imposing their own brand identity onto what was happening in their stores. They then took ownership of their own space and clamped down. Supermarkets standardised everything. This led to a strong own-label identity, but over time it became boring.”
“But, there are signs that this trend is breaking down. Manufacturers are being invited back to create more scale and more theatre.”
Historically, says Griffiths, promotions were very much about price, savings and added value. Now promotions are run to inject fun, involvement and excitement into the stores.
“From the retailer’s point of view, it’s a way of making the shopping experience that millimetre better. If brands give more entertainment and value to the retailer, the cost of space isn’t at quite as much of a premium,” says Griffiths.
Patrick Bell, marketing director of Coutts Retail Communications, looks forward to a day when advertising starts with the instore environment and works outwards from there.
“POP is a relatively low-cost way of making big sales. A 300 per cent increase in sales during the promotional period is not unusual. We maintain an open dialogue with multiple retailers to establish what they want out of point-of-purchase material,” says Bell.
Bell believes negative reactions to point of purchase are often caused by agencies which are ill-equipped to produce POP work. “A lot of smaller companies don’t have the necessary resources. Consequently, what they manufacture is not well suited to the retail environment,” he says.
Bell believes major retailers do not realise the potential offered by POP. “One major supermarket chain recently clamped down on free standing units and any off-shelf POP in order to maintain a ‘clean aisle’ policy. Surely it is time to relax such sweeping restrictions and to judge each case on its merits? POP campaigns can be designed to meet retail objectives as well as brand objectives, thus adding to the overall store image,” he says.
POP appeal starts with the impact made by the product itself, says John Wood, client services director at Turnbull Wood Hayes.
“Brand owners should be aware of how important packaging is. Whatever controls supermarkets may exercise, dictating the packaging of a branded product is not one of them. Also, you don’t get many opportunities for POP material, so you must make sure that your efforts are integrated with the rest of your marketing activity,” he says.
For POP to be worthwhile, it must have demonstrable cost advantages, says Matthew Hooper, managing director of Interfocus.
“Supermarkets are becoming more aware of the most cost-effective techniques for improving sales. However, they are only open to those techniques which can offer demonstrable returns on investment. To maximise your return on POP it is essential to ensure your activity fits in with the direction of all marketing efforts. A lack of cohesion will simply confuse the consumer.
“The way forward is for supermarkets and brand manufacturers to work together to develop a better idea of what appeals to the consumer. Only by better execution and targeting of POP will its full benefits – together with a corresponding uplift in sales – be realised,” he says.
It is certainly in both retailers’ and brand owners’ interests to co-operate in this respect. Charles Kessler, sales and marketing director of Kesslers International, says: “Using displays to promote brands instore allows the store to capitalise on external brand advertising spend. Point-of-purchase displays increase customer uptake, benefiting both the brand and the retailer.
“Consumers are used to displays in other retail sectors and expect to see them in supermarkets, especially as the product categories carried are becoming increasingly diverse. Supermarkets need to use brand displays to sell brands that are available in other sectors in order to compete realistically,” says Kessler.
Several retail chains are updating their traditional methods of boosting sales. One of these is a way of dispensing coupons for redemption in the store during the shopping expedition.
Aspen Specialist Media has developed an electronic couponing system. Its managing director Malcolm Preston says: “It is a US system that delivers coupons electronically from a small unit that fits on the supermarket shelf next to the product it promotes. The advantage of electronic distribution is the unit attracts attention. It delivers coupons on a timing system, so there is no temptation to misredeem.
“Brands pay a one-off price for us to position the units beside their products in store. The only other cost they have is that of redemption.
“The vast majority of people who enter a supermarket no longer have a shopping list, and even if they do it is likely to mention a category ‘coffee’ rather than a particular brand of coffee. Most buying and brand decisions are made instore. Therefore, the opportunity to influence the customer close to the point of purchase is becoming more and more important.”
However, as more companies climb on the bandwagon of hi-tech POP gimmickry customers are likely to experience sensory overload. Catching the eye of a passerby is the aim of a company called Wicked Widgets, which offers three-dimensional animation in ‘lenticular displays’ at the point of purchase. The techniques involved include multi-phase animation or virtual video, as well as the morphing of images. When the product is tilted or the viewer moves, a 3-D effect is activated. The display thus appears to move as the customer walks past.
David Wade, account director at Wicked Widgets, says: “When a brand wants to talk to consumers at the point of purchase there is only a limited amount of space available. Lenticulars enable two or more messages to be conveyed in the same space. Displays using normal printing processes only allow enough room for one.”
Is it sensible to try to give customers so much information at once? From both the retailers’ and the brand owner’s point of view, the answer appears to be yes. Wade cites a 90 per cent rise in sales of Skips snacks as a result of a recent display.
Nigel Petty, chairman of Evans Petty Associates, sees no reason why this upsurge in POP marketing will herald a return to the bad old days.
He says: “A decade ago, customers were bombarded with brand images, promotional messages and special offers – they were exhausted by the shopping process. As the power of the major retailers grew towards the end of the Eighties, in-store point of purchase was swept aside in favour of the retailers own images.
“Today, as customers have become bored with the sterile atmosphere, and as major retailers begin to position their stores as the centre of ‘village life’, there’s a tentative swing back to the old market atmosphere,” says Petty. “This doesn’t mean a fresh onslaught of cardboard and dayglo, but rather a sophisticated approach to retail marketing.”
Among the new trends, says Petty, are instore videos, ceiling ads and floor graphics. Lighting is also being used to enhance the ambience of higher-margin products.
Petty comments: “It is not simply a question of getting more people in the store, but of trying to achieve the highest margin from money spent. We have researched product position within stores and shown dramatic uplift of activity when products are positioned correctly.”
And if customers fail to be impressed by all of this activity Petty urges patience: “We have the technology to change dramatically the shopping process and instore service – it’s a matter of waiting for consumers to catch up. Once the novelty hurdle has been overcome, shoppers will accept technological advance as naturally as they now accept automatic teller machines.”