It’s All About POS/POP Execution – Our Customer’s Perspective
We just wrapped up our best year ever here at OnTrak Software.
Now begins the task of implementing and training our new customers and continuing to support our renewing customers. Before we get too far into 2013, however, I thought it would be prudent to step back for a moment and review some of what our customers and prospective customers shared with us in 2012.
POS/POP marketing continues its transition from defense to offense
Due to the proliferation of brands and products coupled with the explosion of the number of channels available on cable and satellite TV, many companies don’t have the money to cover all of the numerous media channels effectively or efficiently. Besides, we’re told, with DVR penetration approaching 50%, today’s audience often skips over TV advertising altogether. Consumer goods suppliers, distributors and retailers have come to the conclusion that shoppers actively seek at-retail marketing messages and make buying decisions nearly 80% of the time while they are in the aisle.
Supplier marketing co-op allowances while more generous are more difficult to collect
One of our new customers, during a demonstration of two of our products, SignTrak and PermaTrak, suggested we should market these solutions directly to his suppliers – and then he caught himself and concluded his suppliers probably don’t want recovering co-op marketing program funds to be made easier (which is exactly what OnTrak’s products enable). Although I’m generally from the school that believes “the customer is always right,” I must disagree with our customer. Consumer goods suppliers really do want to pay for point-of-sale / point-of-purchase (POS/POP) marketing – because it works! What suppliers don’t want to do is pay for POS/POP that never makes it to the intended retail location or isn’t measured for its ROI.
Consumer goods suppliers want POS/POP accountability from wholesalers and retailers
Actually, what most consumer goods suppliers want, according to organizations like POPAI and the Point To Purchase Institute is POS/POP execution and accountability. This simply means that POS/POP ideas are conceived and focus-group tested by suppliers. Then those POS/POP initiatives that have been shown to be the most effective are manufactured and printed and sent to suppliers’ wholesalers and retailers to be placed where they’ll do the most good. What happens next, however, according to several recent studies by A.T. Kearney, Inc. and others is that only about 53% of consumer goods suppliers can confirm 50% or greater placement of POS marketing materials. Some of our new customers – large beverage wholesalers – claim the amount of POS/POP that is wasted is staggering.
POS/POP tracking and reporting technologies are needed to determine ROI
For almost two years, we’ve been following Consumer Goods Technology’s website and attending their informative webinars. In 2011 CGT was reporting that consumer goods companies listed the lack of available software tools to enable them to track and verify the entire POS lifecycle was a key inhibitor to ensuring POS was placed and metrics gathered to determine ROI. Since 2011, we listened to our customers and other POS experts and we have added detailed report writers to all of our products. When our customer’s sales data is integrated with OnTrak’s, POS/POP correlated sales lift and ROI can be measured. Our software tools are cloud based and can be implemented typically in a matter of a few weeks. The key message is that many of the needed software tools are here today. Another message is that suppliers are looking for technology to help them ensure POS/POP marketing program compliance.
What we heard from our customers in 2012 is that 2013 will be the year where POS/POP marketing grows significantly in importance, must be tracked and its ROI measured and managed.
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