Proven points

Point of purchase marketing has long been known to work, but marketers have found it difficult to quantify the effect it has on sales. New technology is now making this possible, says Richard West

Why is it that advertisers find it so difficult to love point of purchase (PoP)? Traditionally, big brands spend millions on above-the-line advertising and comparatively little on in-store marketing. Despite all its efforts the PoP industry seems unable to shake off its reputation as a marketing tool that “probably does something, but not sure what that might be”.

But attitudes are changing. Marketers first started paying more attention to PoP five years ago, when a Mintel survey described it as “the ultimate advertising and marketing opportunity”, reporting that up to 70 per cent of buying decisions are made at the point of purchase. Since then, a growing number of big brands have realised that in the complex world of multimedia communication, maintaining a consistent message means managing every stage of the buying cycle up to, and including, the moment when the customer decides to buy. Given that global players such as Nike and Reebok are already switching large chunks of their marketing budget to local promotions and themed stores, the industry body Point of Purchase Advertising Institute (POPAI) believes that others will follow, and that PoP could emerge from the shadows.

David Graham, chief executive of PoP designers Oakley Young, says: “You might say that media fragmentation has been very good for the PoP industry. Companies are demanding more control over the way their brands are communicated. However, the growing number of media-channels – the Internet, digital television and mobile phones – makes this problematic. Brand managers are increasingly spending money where they know they can connect with the consumer – the point where the decision to purchase is actually made. At outlets like Nike Town, for instance, visitors experience nothing but the Nike brand.”

According to a recent report by the Henley Centre, shopping is the fastest growing leisure pursuit in the UK. A recent MORI report found that more than a third of people need a regular fix of “retail therapy”, and enjoy the shopping experience.

But the growing interest in PoP suggests that its emergence is more than a passing trend. The past few years have seen dramatic technological advances that have triggered a wave of innovations. Bernard Guly, managing director of in-store graphic designers View, says: “There’s never been a better time for PoP. The things we can do now with electronic and interactive stands are sophisticated and potentially very eye-catching.”

Enhanced printing techniques, improved materials, more user-friendly interactive kiosks and software have helped make PoP a far cry from the dump-bins and low-tech solutions of the past. But many in the industry – weaned on a diet of minuscule budgets and hardened by the indifference of their marketing peers – are being cautious.

Marketing fulfilment company Bezier’s design marketing director, Dave Corben, says: “Too many PoP displays include innovation, not as a means to improve in-store awareness and drive sales, but more as a novelty feature or gimmick. Technology will play an increasing role in PoP as it becomes more of a strategic exercise and less tactical. Some technologies in development, such as the flat-screen TVs – known as plasma screens – will allow in-store promotions to be better targeted. However, PoP companies will need to develop these strategic possibilities and, more importantly, persuade store managers of their value.”

Proving PoP’s worth, as many practitioners will readily admit, has never been one of the industry’s strong points. In the past it has been argued that the customer-buying process is such a complicated mix of brand loyalties, consumer attitudes, store layouts and mysterious x-factors, that quantifying the effect of PoP on sales is like trying to untangle the secrets of the universe. But like any marketing medium, PoP has to demonstrate a return on investment – if it doesn’t have an impact on the bottom line, it is unlikely to impress hard-nosed brand managers.

POPAI UK general manager Martin Kingdom acknowledges the situation. He says: “The changes taking place at the moment are being driven by the consumer. Increasingly we’re becoming an information seeking society, so while there will always be a place for low cost solutions, such as dump bins and shelf-talkers, there’s also been a growth in demand for plasma screens and what could be described as hi-tech information providers.”

Information seekers

The trouble is that while the Internet generation may feel more at home when surrounded by screens and monitors, no one has demonstrated that such electronic wizardry stimulates consumers to part with their money. Kingdom adds: “I doubt whether there are many cases where the return on the investment could entirely cover the costs of some installations. However, technology has arrived that at least makes it feasible. The problem now is how best to use it.”

Talk to anyone working in the PoP industry and it won’t be long before the phrase “fitness for purpose” is mentioned. Industries such as travel, or purchases that require customers to make complex decisions, have been able to exploit new technology to add value to both the service and the brand. Problems occur when the designers or clients don’t understand, or misuse the medium.

Kingdom says: “Too many advertisers fall into the trap of using the in-store screens to replay television advertisements or corporate videos. But the in-store environment demands a more personal, interactive, but also rapid means of communicating a message. No one has yet worked out the best way to use the technology.”

The product is the hero

One of the industry’s maxims is “the product is the hero and PoP should never overshadow it”. Yet those who work closely with PoP are concerned that the growing interest in technology will set the industry back years, if it upsets this balance and clients start to treat it as a gimmick. What is required is qualitative research to help people gain a better understanding of PoP – how it can be used more strategically and to greater effect.

Kingdom adds: “At the moment PoP lacks the measurable proof of other media that it has an impact on sales. However, POPAI is in the process of doing something about that.”

Last year, a carefully controlled experiment sponsored by POPAI and conducted by Woolworths, Birds Eye Wall’s and research agency RMS, found that an investment of £40 in PoP material increased the value of ice cream sales in a test store by more than seven per cent, compared with its control site. Furthermore, by recording and analysing the way customers behaved in both stores, the researchers discovered that consumers were 30 per cent more likely to purchase an ice cream from the test store than they were from the demographically similar control store.

Grown by design

RMS research manager Guy Vaughan has no doubt that as PoP moves up the agenda there will be more interest in the processes at work. He says: “It is something that has grown by design not science. Most people accept that it works; now we have the tools to find out how and why. When we have that information, people will be able to use it more effectively.”

Some of that information is being provided by the interactive PoP displays themselves, but the researchers are keen to gain a more complete picture, which is why they spend as much time video tracking and interviewing shoppers as they do measuring the increase in sales. But is there a danger that too much analysis could stifle the creativity of the designers and manufacturers? After all, really innovative PoP can be great at meeting more qualitative objectives, such as creating the sense of in-store theatre and raising the interest of the staff.

Adding to the experience

Guy Vaughan doesn’t think so, he says: “In the past PoP has always been part of the brand idea, and usually handled by a junior member of the brand team. Now it’s getting much closer to the shopper, adding to the shopping experience.”

He explains that retailers are beginning to use it far more strategically, integrating it as part of their marketing. Vaughan adds: “Take the retail chain Oasis, for instance. Its website receives far more hits on Fridays because people are visiting it to find out what’s in-store before they go shopping at the weekend. Managers can access data from the server files very quickly and make a rapid assessment of what’s interested the customer. This information can be used to help them change the store arrangement, using the PoP to maximum effect by directing the Saturday shoppers to those particular areas of interest.”

POPAI chief executive Mark Kingdom believes that companies such as Oasis are showing that they understand the strategic value of PoP. “No one should ever use technology just for the sake of it. As generations change, consumers may have a greater familiarity with technology and even come to expect it. But simplicity is the key. If the shop staff and the customers don’t understand it, it will never work. Then you’ll find a £30 display will do a better job than a bank of plasma screens.”

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