Making the Most of Point-of-Sale (POS) Marketing
TRACK – Configure, Produce and Place POS
MEASURE – Where, When, How Much Spent and the Sales Impact?
MANAGE – Analyze and Report on Supplier Bill-Backs, Profitability and ROI
Perhaps no ‘place’ is more important to the sales of most consumer goods than the last point of contact between shopper and product.
For most consumer goods companies, the growth of marketing spend continues to sharpen focus on turning shoppers into buyers at the so-called ‘moment of truth’ – The point-of-selection, aka, the point-of-sale. POS spending is on the rise, often displacing some of traditional marketing’s budget.
The US POS marketing spend is now approaching $21 billion. Despite its growing share of the marketing budget, POS is often challenged with respect to its effectiveness. We believe this is because POS activities are often not tracked, measured and managed, and unfortunately not always aligned with the brand’s overall marketing plans.
We’ve noted here in our blogs that POS marketing is often defensive or reactive. Many times a brand or product’s POS initiatives are influenced by competitors. The result of this defensive approach is what we call “…a failure to communicate.” (See Note 1)
When this happens there is little or no connection between overall brand marketing and the brand’s POS marketing. Until POS marketing initiatives are synchronized with the overall brand marketing plan this disconnect will remain. Based on our experience with our customers, it is our opinion that the POS marketing initiatives should be developed before the rest of the marketing plan, and then linked together.
Of course this approach assumes one of your goals of a marketing campaign is to sell more of the product!
10 Steps to Managing Your POS Marketing Process
If you agree, then here is a high level overview of the steps you can take to make the most of your POS marketing:
Define your sales objectives for the brand
Develop your POS campaigns and then create your traditional marketing initiatives
Determine your budget and allocate spend to correspond to your sales objectives (See #1)
Develop the criteria for POS placement (Remember the costs to create and place POS marketing materials is virtually identical for high and low traffic volume retailers)
Track the orders and placement of your POS
Measure the impact by correlating the sales change (up or down) to POS placement dates
Compare POS spend to sales increases to determine the ROI of a POS campaign by customer, territory, region
Compare the outcome to objectives (See #1)
Manage expectations and if needed develop and implement changes to campaigns, or modify your objectives
Repeat as needed
OnTrak provides a set of standardized business systems to manage this POS marketing process, as well as a set of analysis and reporting tools to help you measure the effectiveness and ROI of the process.
To learn more about OnTrak products, please click this button:
Note 1 - Quote from the 1967 movie classic, “Cool Hand Luke” – attributed to the prison warden played by Strother Martin
The 70th Annual WSWA Convention: So Hot, It’s Cool!
First, our thanks to the WSWA and the convention staff - A job well done!
We’ve just returned from the WSWA 70th Annual Convention & Exposition in Orlando – our fourth year in a row as attendees and our first year as both a Member and Sponsor.
From our vantage point, this year’s theme, “So Hot, It’s Cool” was very appropriate; and this year’s convention was our best experience ever.
Not only are beverage alcohol sales surging, but also the number of WSWA convention attendees is swelling to over 2,300.
Sunday’s opening general session by Doug Hertz, president of United Distributors, and WSWA Chairman, included a decade-by-decade history of the WSWA. Next was a very funny and entertaining presentation by keynote speaker, Terry Bradshaw, NFL Hall of Famer and broadcaster.
One of the high points of the convention was Tuesday’s general business session when Richard Leventhal, Chairman and CEO of Fedway Associates, received a lifetime leadership award. Richard gave a poignant, pictorial reminder of the devastation of Hurricane Sandy and the damage done to this distributor. He highlighted the incredible hard work of his employees, and the selfless actions of other distributors who came to the aid of Fedway, getting them back in operation in just over two weeks. Fedway’s amazing story received a standing ovation and an obvious and unrestrained outpouring of support from his peers.
Tuesday’s closing keynote speaker was Barbara Corcoran, real estate mogul, entrepreneur and TV personality on ABC’s Shark Tank. Barbara entertained and inspired the audience with her life story from a modest upbringing in New Jersey, to the heights of the real estate market in New York City. Her ‘keys to success story’ was motivational and well received by all attendees.
U.S Beverage Alcohol Forum – Break-out Sessions
Of particular interest to us were several break-out sessions, notably “Launching Brands in the U.S. and Addressing the Challenges of Distribution Today” and “Using Technology to Drive Your Business on the Street.”
These presentations included panelists from suppliers, distributors, marketing and technology providers and a national POS fulfillment company. The takeaways from these sessions are too numerous to discuss here in detail, but it is clear that launching a brand requires skills from several disciplines and the staying power afforded by a well-capitalized supplier. At the same time, technology is a critical competitive advantage, not just for logistics, transport planning and accounting, but also for retail marketing initiatives. Repeatedly, both suppliers and distributors noted that one key to building a brand is to “Get customers to try your product – which is difficult in an overcrowded space, for example, wine.”
Launching a new brand of wine (spirit or beer) is an expensive proposition these days. Panel members agreed that one of the keys to getting a trial of your brand is to recognize that the most important place to market a new beverage alcohol product to shoppers is clearly at the time and place that they are actively looking to buy.
Our perspective is that the point-of-sale (POS) has not traditionally been the place that enjoys the majority of either the marketing budget or the deployment of tracking and measuring software. In short, too much money has been spent building brands via broadcast or print media that shoppers can’t find or can’t even remember once they are overwhelmed by the variety and choices before them in the aisle. The result is that too little money has been spent on marketing at the point-of-sale where it can make all the difference in a shopper becoming a buyer [of your product] or walking on to the next product.
Clearly POS, shopper marketing, marketing at-retail is reaching or has already reached “critical mass.” Suppliers and distributors may not agree on everything, but one thing they seem to understand is that POS spending is of critical importance yet, in many cases, is out of control – unable to be tracked, measured and managed.
If this describes your situation, press the button below – we may just have the solution you’re looking for.
Increasing Wine Sales - Why The Point-of-Sale Marketing Mix Matters
And It Matters Just as Much for all Beverage Alcohol Products
Is Your Brand or Product Being Seen?
You’ve probably heard the saying: “Perception is reality.”
And you probably know how difficult it is to change someone’s perception once they have made up their mind due to a "perceived" reality, vs. a “real” reality.
Well, there is another saying I’d like you to consider: “If I can’t see you, you don’t exist.”
Speaking of being seen, consider that wine – as well as all types of beverage alcohol – marketers, suppliers, distributors and retailers really do have their work cut out for them these days with the availability of the thousands of products competing for consumer’s attention.
Here’s an example: An eastern-US regional grocery chain, Giant Eagle, with stores in Maryland, Ohio, Pennsylvania and West Virginia, currently offers over 1,950 wines, 100 champagnes and other sparkling wines, 840 beers and 450 spirits. With every remodel of an existing store or construction of a new store, the real estate devoted to beverage alcohol products increases. So here's the key question!
Q: What kind of marketing do these thousands of beverages get?
A: Most of these beverages – with the exception of some of the beers from AB/InBev and MillerCoors – receive little to no "traditional marketing" support. Sure, there are some print and Internet ads, but with availability of over 105,000 wines, for example, suppliers and importers can only support a relatively few number of brands and products with traditional marketing.
The truth of the matter is there are fewer and fewer new beverage alcohol products that can afford any kind of traditional marketing support such as print and broadcast ads, product brochures, billboards, sales force incentive programs or sponsorships.
And it’s only going to get worse, especially for wine.
Here’s one reason why, according to Wines and Vines. (Note 1) The total number of North American wineries grew from 6,357 in 2009 to 7,498 in 2012 - Over 18% growth. When you include wineries from Canada and Mexico, that number grows to 8,046. The point is: The market for wine, spirits and beer is said to be “oversaturated”, meaning the majority of products coming to, and already on the market, will likely be unseen and therefore from a perception standpoint they simply don’t exist.
How To Be Seen? Establish (and then track) your 'POS Marketing Mix'
What can the growing number of national and international wine suppliers do to be seen?
First, it is probably a good idea to remember that the goal of marketing, according to Peter Drucker, “. . . is to make selling unnecessary.” (Note 2) One way good marketing accomplishes Drucker’s goal is to make your brand or product stand out from the crowd. When applied to most wine and other beverage alcohol brands and products, some of the few affordable forms of marketing include point-of-sale (POS) displays, paper and permanent signs, banners, coupons, tasting events, dinners, demonstrations, wine lists, and food and wine menus.
We typically call these forms of marketing and promotion the "POS Marketing Mix." Naturally, it follows that the POS Marketing Mix must be managed to assure that you’re getting the best possible return-on-investment (ROI) on your marketing and promotional campaigns. This brings us to another point made by Drucker, “You can’t manage what you don’t measure.” We further enhance this concept by saying “You can’t measure what you don’t track.”
The good news is that POS marketing, unlike most traditional marketing (Note 3), can be measured to determine its effectiveness (correlation) and efficiency (ROI) in generating or increasing sales of a particular product.
From our perspective, the even better news is that OnTrak’s products provide beverage alcohol marketers the tools to track, measure and manage the POS Marketing Mix.
To learn more about our products click this button:
Note 1: “North American Winery Total Passes 8,000,” Wines & Vines, February 2013; read more at: http://www.winesandvines.com/template.cfm?section=news&content=111242
Note 2: Peter Drucker, The Grandfather of Modern Marketing, The Drucker Society, 2009 presentation by Philip Kotler; read more at: http://www.druckersociety.at/repository/201109/Grosser_Festsaal/1530-1615/10.0.1%20Kotler.pdf
Note 3: Traditional marketing – for example, print and broadcast ads – cost is typically presented as “CPM” which is the cost per thousand views. Two variables are used to calculate CPM, audience and cost. Measured POS, on the other hand, correlates marketing costs to sales to calculate ROI and to demonstrate the relationship between a specific POS marketing campaign created for a specific market (or customer) and brand (or product) and the % change (+/-) in sales performance (lift) during the time-span in which the POS was displayed. For more information go to: http://www.srds.com/frontMatter/sup_serv/calculator/cpm/
Wine Samples - How To Turn Wine Shoppers into Wine Buyers
For years US wine suppliers, distributors and retailers have studied and researched what makes American wine shoppers actually buy wine.
There have been industry and academic studies conducted to determine the wine consumer’s ‘reasons to buy’. These study results may provide some insight into what can be done to motivate a wine shopper to actually buy one or more of the thousands of wines available to them at their favorite retailer or restaurant.
With the exception of fine dining – where customers often rely on the restaurant’s sommelier or wait staff for wine selection and wine-food pairing recommendations – the #1 reason consumers select a wine is previous experience.
In other words, wine consumers typically choose wine because they know what it tastes like. These ‘tasting biases’ aren’t just limited to restaurants. The same selection bias is equally applicable to wine stores and other retail settings. For this reason, it is important for suppliers and their distributors to create as many opportunities as possible for everyone in the distributor-retailer-consumer supply chain to experience their wines.
We define these opportunity events as sampling (business-to-business) and tasting (business-to-consumer) programs.
The wine supplier’s customers are the wine distributors, and the wine distributor’s customers are the retailers. So it’s important for wine suppliers to encourage their distributors to conduct many sampling opportunities for the retail buyers - the consumers. In fact it’s vital that each tier in the chain support and encourage sampling and tasting programs. (See Note)
Our experience with wine, spirits, and beer companies suggests three things:
Wine suppliers, working through their distributors should encourage on-premise retailers to provide an ever increasing and changing selection of branded and varietal wines-by-the-glass and wine-flight offerings. Then make sure to support these offerings with table tents, signage and other point-of-sale (POS) mentions, including menus.
Wine distributors, working with their wine suppliers, should support at-retail wine education events; especially in the wine departments of large retailers and at stand-alone wine stores and boutiques.
Wine retailers, working with their distributors, must create at-retail sampling programs, and build and increase tasting events with retail shoppers. The more tastings a retailer conducts, the more wine sales will be increased for everyone.
The ultimate goal of all of these sampling, tasting, mentions and other POS programs is to introduce as many new brands and wine labels as possible to distributors, retailers and individual consumers. For both on- and off-premise retailers, these programs will also help in building loyal, repeat consumers who will often recommend specific positive wine experiences to friends. Our customers tell us that a wine recommendation from friends is another key wine selection influencer, nearly as important as previous experience.
For suppliers, distributors, retailers and restaurants alike, frequent hosting of sampling and tasting events, wine dinners and other wine-centric events, and simultaneously supporting these events with brand-specific POS – signs, displays and menus – creates a climate that provides measurable sales increases and a positive return-on-investment(ROI).
There Is a Solution
As the importance of wine sampling and tasting events has grown, it has become increasingly more important for suppliers and distributors alike to track, measure and manage the number of no-charge bottles used for brand, label and retail promotion. Keeping track of sample requests and the measurement the ROI of sampling activities is more difficult than ever, especially now that there are over 105,000 wine labels on the market today.
Only OnTrak’s newest solution, SampleTrak – designed by wine distributors for wine distributors – can help distributors work with their suppliers and retailer to manage these important and expensive ‘liquid assets’.
To learn more click this button:
Note 1: The rules and regulations for tasting events (retailers to individual consumers) vary from state to state. These recommendations should be undertaken in compliance with applicable state laws governing consumption at retail locatons other than restaurants, bars and other on-premise retailers.
Improving Wine Sales with High Quality Wine and Beverage Menus
As you may know, recently, the US became the number one wine consuming country overtaking France.
However, US consumer's ‘Wine IQ’ hasn't kept pace with the increasing demand.
With over 105,000 wine labels now available to US wine consumers, (and that number is growing), it’s no wonder that many diners develop ‘Wine Selection Anxiety’ when it comes time to order a bottle of wine to accompany dinner. With so many nondescript wines available to them, many diners will choose a wine based either on price, or their server’s suggestion.
“But wait,” you may be saying, “Virtually all restaurants that sell wine, already provide a wine menu. Aren’t you setting us up to tell us we will sell more wine by adopting wine menus?”
Yes, I am going to suggest that wine menus do drive wine sales. And I also agree with you that any restaurant that sells wine to its patrons already has a wine menu. But I am also going to make some suggestions about wine menus that will give you an excellent chance of driving even more wine sales. In addition, if you implement some of these suggestions your customers will keep coming back because your wine menu creates truly delighted customers.
Menus - Another Type of POS
I’d like for you to think of a wine menu just as another type of point of-sale promotion (POS). After all, the wine menu offered to restaurant patrons is a form of advertising or merchandising that is meant to influence diners to make a wine buying decision while at the point of sale.
In other words, wine menus, like traditional POS types – signs, displays, etc. – are merchandising tools; and like all forms of POS, menus need to be carefully designed and tastefully executed.
According to Cornell University’s Center for Hospitality Research, generally restaurants with higher wine sales utilize wine menus that:
Are part of the food menu
Do not include a dollar sign in the price listed
Include multiple mentions of wine from a specific winery or wineries
Have lists with a minimum of 150 labels and
Include a “Special” or “Reserve” categories of wines
Of course, it goes without saying that providing some information about the wine mentioned on the list will serve to reduce wine selection anxiety.
A related fact is that restaurants with lower wine sales utilized menus that only categorized wine by style, with a limited number of choices, and which were dominated by low price-point wines.
If you are a wine distributor, or the customer of a wine distributor, it would be to your advantage to heed Cornell’s findings and adopt as many of the above recommendations as possible. It could be quite an advantage for you if you were able to keep track of and measure the success of the menus you created that follow these successful wine menu characteristics.
The good news is, there is a powerful merchandising tool that will help you track, measure and manage your customers’ wine menus so that both your customers – and you – sell more wine.
That tool is MenuTrak! For more information please click this button:
Harness the Full Power of Beverage Samples - With SampleTrak
Take it up a Notch and Capture Consumer Feedback
Inc. Magazine published a story titled, “How to Use Samples to Promote Your Product.”
The article starts off outlining how a start-up coffee shop named Gordon Grade Coffee Company aimed to use a large-scale sampling effort at a university during finals time. With the usual goal of translating sales into actual business, such an effort (especially during an important time in a company’s ramp up stage) has risk, but also significant potential. The article discusses a variety of products and emphasizes the need to know why you’re sampling, what product is best to sample, and what audience to target.
In OnTrak Software’s business, which focuses on tracking, managing and measuring beverage alcohol samples and other marketing materials, the importance of HOW to sample is obviously quite relevant. However, OnTrak takes sampling much further. Once beverage distributors have a strong sampling plan in place, OnTrak encourages distributors to “sample” its SampleTrak solution. Samples are great, but why not use them to actually gain consumer feedback? It’s the logical next step instead of simply waiting to see if samples eventually translate into more sales.
Let’s face it – the effectiveness of samples can be a problem if a restaurant or store doesn’t track the information they need to see what works and what doesn’t. Additionally, if an audit trail for inventory isn’t maintained, do you really know where samples are going, or what percentage is truly being used for its intended purpose? Without tracking, samples really can’t serve a definitive role in your long-term business strategy.
Here’s what beverage distributor’s can turn to:
SampleTrak software can help you capitalize on market share opportunities and get more from sampling programs by providing detailed information – from what beverage was sampled, where and to whom, with tasting comments. SampleTrak ties it all together in order to show you how your sampling efforts correlate to sales.
Once you know what’s really going on with your samples, you’re ready to fully harness their potential.
In The Inc. article, it mentions that the coffee company was planning to offering more than 2,000 samples of its product during one major campaign. Imagine the value of tracking the feedback from each and every one of those samples. Now THAT’S data any company would want.
Click here to learn more about OnTrak's sampling solutions:
Point-of-Sale Marketing 101: Increasing Sales with at-Retail Marketing
Traditional Media Advertising vs. Point-of-Sale Advertising
As beverage marketers are aware, the steps required to turn shoppers into buyers are quite often varied and dissimilar.
The first step in point-of-sale (POS) marketing involves the branding of the product itself, followed by what is currently called “traditional media advertising”, and ending with at-retail advertising. Suppliers, wholesalers and retailers must be certain they attract and keep the consumer’s attention right up to the “moment of truth” – when a shopper becomes a buyer.
Our view is that POS marketing is the most important step of all – after step one, that is. We believe, and the data supports, that shoppers in the aisle need to be motivated to buy often with nothing more than a little push. This push is most effectively given by in-store advertising, which directs the shopper to the features, benefits, “newness” and price of the product.
You probably already knew this – but a reminder can be helpful from time-to-time.
Marketers throughout the supply chain, whose goals include increasing sales, know that to be successful they must develop marketing plans which identify with the shopper’s wants and needs. POS materials placed alongside the advertised product are seen by one shopper at a time and are therefore the most personal form of advertising.
POS advertising can differentiate your beverage brand or product from the competition. Importantly, this form of advertising is the most cost-effective marketing there is; and, is certainly the easiest to track, measure and manage.
Think of this: Using readily available software tools, (like those from OnTrak), POS expenses can be directly correlated to sales; and the return-on-investment (ROI) of your at-retail campaigns can be quickly determined. This allows your POS merchandizers to be more agile.
For example, if one form of POS advertising proves to provide a larger and more consistent sales increase than another, then new POS materials can be quickly created and placed. Traditional media advertising, on the other hand, may offer a “CPM” – the cost per thousand viewers. But the correlation to sales and the measurement of ROI using CPM would be difficult if not impossible. The truth is that traditional media has never been known for its agility.
Regardless of the beverages that you distribute, POS Marketing has the ability to immediately increase sales. While traditional advertising can have a positive impact on the brand, the correlation to sales and ROI may be a challenge to determine.
OnTrak provides the tools to help track, measure and manage your at-retail marketing campaigns and drive growth and value for your business.
To learn more about OnTrak solutions, please click the following button:
More Point-of-Sale Marketing Lessons Learned From Our Customers
Listening to the Market
OnTrak works with beverage distributors all across the United States and we attend and exhibit at beer, wine and spirits conferences several times per year. So we are often is a good position to listen to both customers, as well as prospects, about their wants and needs regarding point-of-sale (POS) marketing.
During the past four years we’ve learned what the most successful beverage brands do to keep their competitive edge – and we know what doesn’t work. We understand, for instance, that the 2008 recession has changed the way consumer packaged goods, including beverages, are marketed.
Overall, signs and displays placed at the point-of-sale continue to dominate the POS landscape. Notably OnTrak’s customers are expanding their use of POS, both quantitatively and qualitatively. That’s because POS, unlike other forms of marketing, has repeatedly shown itself to be a driver of incremental sales. POS is also one of the best, if not the best form of marketing for persuading shoppers to become buyers.
Our customers tell us this persuasive aspect of POS is especially true when the product being promoted is new to the market. With their guidance, we’ve been saying that effective POS campaigns have proven to be critical to cutting through the retail clutter to drive impulse or unplanned sales. Industry studies have shown that without effective POS materials shoppers are less likely even to see – let alone try – new products.
What Doesn’t Work
I mentioned at the beginning of this blog, that we’ve learned what doesn’t work. Take a new product that is introduced to the market with expensive TV and print advertising but with precious little POS support. The predictable results are that the new product is rendered almost invisible right at the exact place and moment in time when a shopper is in the aisle ready to become a buyer.
A better approach would be to spend the lion’s share of the marketing budget not on traditional advertising such as TV or print but on advertising that would grab the attention of consumers when they are looking to become buyers. And that’s POS marketing!
After talking with our customers and reviewing the conclusions of point-of-sale marketing experts from POPAI and The Path to Purchase Institute, it is clear that if new product or incremental sales of existing products is the goal of marketing, the most effective and generally the most efficient campaigns are those initiated, tracked, managed and measured at the point-of-sale. According to research from these two organizations, the ability to drive retail sales really comes down to one thing: getting noticed. If your target customers can’t find your product, they will likely default to buying the product they notice; and that would be a product they have purchased before, or one that is noticed by virtue of effective POS materials.
One Last Point
The customers who receive the greatest return-on-investment from their POS initiatives are those who use our tools to determine the connection between product and customer sales vs. their POS spending. At OnTrak we understand the value to your business of at-retail signage and displays. We’ve helped numerous customers of all sizes get the most out of their POS investments. When you get your products noticed they stand a much better chance of being purchased. OnTrak’s POS track, measure and manage software tools are proven to help give our customers a competitive advantage. For more information on how to maximize your POS ROI, contact us.
To learn more about OnTrak’s POS Marketing Tools, click this button:
Using Data to Increase the ROI of your POS Marketing
I’ve spent a good bit of time over the past few weeks reviewing the amount of data that beverage distributors are gathering about their retail or shopper marketing initiatives.
POS Marketing Spend vs. ROI
From a financial perspective, a quick review of this data makes it clear that beverage distributors spend millions and millions of dollars annually on producing, inventorying and placing both temporary and permanent Point-of-Sale (POS) materials.
Temporary POS materials include for example: paper or vinyl signs and menus. Permanent POS materials include for example: neon signs, mirrors and tap pulls; as well as product samples. The temporary POS materials may be either produced in-house, outsourced to a third party printer, or purchased directly from the supplier. Permanent POS is purchased from the supplier or a certified POS provider and inventoried in a warehouse. But no matter the POS type or the source, it all costs a ton of money.
The US beverage market is about $1.3 trillion annually, so it shouldn’t be surprising that many beverage distributors’ annual sales figures exceed $100 million and there are a number of beverage distributors whose annual sales are in the billions.
For the investment made by beverage distributors in their POS marketing initiatives, it looks like a lot of revenue was generated.
But here’s my question:
How many of these distributors actively capture their POS marketing spend data, and then use this data to help them determine the ROI of their POS marketing campaigns?
Our experience says that not many of them do.
There could be many reasons why they don't, but the one we hear most is that many distributors don’t know that the POS cost data to plug into a formula to calculate the ROI is readily available.
In some cases it’s a matter of historical perspective. If calculating ROI on POS is something that has rarely if ever been done, it tough to shift to a perspective of now it can be done; and done easily.
Big Data is a Big Deal!
According to an IBM study (Understanding Big Data) released in 2012, “Every day, we create 2.5 quintillion bytes of data — so much that 90% of the data in the world today has been created in the last two years alone.” (While the contents of the IBM report are not related specifically to the beverage industry, it does point out that having Big Data is a Big Deal!)
Today, OnTrak’s POS/Marketing Communications software collects a significant amount of POS marketing data. When this POS data (including costs) is correlated to brands, products or customer sales information it can yield valuable, actionable ROI information that enables post-POS campaign analysis. This analysis provides predictive capabilities to forecast which of your upcoming-POS programs are most likely to produce the desired business results.
In other words, with OnTrak, you now have the tools to help determine which POS is likely to provide the optimal sales lift.
In previous blog postings, we have discussed the reasons for the increased focus by consumer goods companies (including beverage) on POS advertising. It is safe to say POS continues to increase in importance in so far as providing brand and product sales lift.
However, if you’re not using the available POS data to establish the link between your POS programs and product sales results you’re missing out on perhaps the best method for optimizing the ROI of your at-retail advertising efforts.
The only way to make the best use of the potential of your POS is to know what has the greatest impact at the best cost. In light of increasingly shorter product life cycles and ever-changing shopper behavior, it is a more-than-worthwhile exercise to track, measure and manage your POS and determining its ROI – it’s vital.
To learn more about OnTrak Software, click this button:
The Importance of Point-of-Sale Marketing Measurement
According to the Path to Purchase Institute (www.p2pi.org), “traditional media” (TV, print, etc.) will see a budget decrease of 37% in 2013; meanwhile, at-retail or shopper marketing is poised to increase over 47%”.
Digging a bit deeper into the statistics, we find that over 58% of packaged food, beverages, candy, beer, wine and liquor products are forecasted to enjoy shopper marketing budget increases of between .1% to over 10% during 2013. In fact, it bears noting that for 2013 the food and beverage category forecasts the largest overall shopper marketing budget increase of all of CPG product categories.
As I examined these 2013 trends, I wondered exactly what these statistics meant, beyond the obvious. Here are some of my conclusions:
To begin with, it is clear that marketing at-retail spending continues to grow apparently at the expense of traditional media spending. Why?
The most logical reason for this one form of promotion beginning to show signs that it will dominate other forms is that marketing at the “point-of-shopping/point-of-sale” (POS) is actually fulfilling its promise – Increased sales. According to organizations like P2PI and the Point of Purchase Association International (www.popai.com), the results are in, and POS works.
Yet there are some disturbing inconsistencies that are revealed when the “growth in POS spend” statistics are examined more closely.
The most glaring inconsistency is that the majority of companies who report their intent to shift more of their marketing dollars to POS aren’t even measuring POS results. For example: Very few are correlating POS promotional initiatives to sales during the time period the POS is deployed. How do they know their POS is working?
The majority of evidence from POS organizations, like P2PI and POPAI, is that at-retail marketing promotion works, is cost-effective and measurable. Yet survey after survey – some from these same organizations – suggest that relatively few companies actually track, measure and verify POS placement. It seems to me that POS is possibly more a matter of faith than a matter of certainty.
The Importance of Measurement
Our view is that the most important piece required to improve your POS marketing practices and results is measurement. Of nearly equal importance is the ability to track the orders, costs and ratios of POS to retail spending.
In other words, it is important to know when an order for POS was placed, for which customer and by what sales rep or merchandiser. It is important to know how much the POS cost to create, and if it was actually placed at the retail location during the period of the promotion (verification/compliance).
How do you get there? (if you are among the majority of companies who aren’t there yet)
Although we certainly hope you will consider our suite of software applications designed to Track, Measure and Manage industrial strength POS campaigns, what is definitely required is for you to set a course for your promotions that includes adopting the tools that will enable the planning, execution and measurement of your POS initiatives.
Without this approach, your POS spend may continue to increase in 2013, 2014 and beyond, and you won’t have a clue how to get the most out of the dollars you put into it.
For more information about OnTrak and its POS measurement tools, please click this button.