One Blog |September 13, 2013 | POS Tracking Software
Retail Wars — At the Point-of-Sale - Part 2
This is a continuation of a blog on the retail wars that are going on at the point-of-sale.
Big Beer Brands vs. Craft Beer Brands
As noted in Part 1 of this blog, you shouldn’t count the Big Beer Brands out — yet. — Even though Craft Beer Brands appear to be on an up-trend; at the same time Big Beer brands are on a slow down-trend. (See Note 1).
Although Craft beer seems to have the upper hand with its guerrilla warfare approach (word-of-mouth, social media and POS); don’t think that Big Beer can’t or won’t adapt. The current situation simply points to an increasing emphasis on a battlefield that is more focused in the trenches. That’s the battle to convert shoppers into buyers in the aisle, at-retail and at the point-of-sale, rather than on traditional media outlets.
POS Marketing History
Historically shopper marketing or Point-of-Sale (POS) marketing has been relied upon to “close the deal” at the point-of-connection between shopper and product. (See Note 2). Yet for almost as long as there has been 'retail', POS marketing has been at best perceived as an also-ran form of marketing and at worst a necessary evil.
When we’ve asked our initial beverage alcohol distributor prospects about their attitudes on POS marketing, some of them complained that POS was a 'black hole' where they threw money hoping something positive would happen. Notice I said 'some' of them complained.
Not so today
Over the past 7 years, we’ve seen the number of companies disappear that criticize POS marketing. To us, this is an indication that attitudes related to at-retail marketing programs (aka POS campaigns) have changed and are continuing to change dramatically.
Things Are Changing
Some of the reasons for this attitude change have to do with the nature of shopping itself today:
- Shoppers perceive they have virtually unlimited choices of places and ways to shop, and have very little loyalty to any of them.
- Many shoppers, particularly the very desirable millennial shoppers, are immunized against traditional media influence due to technology - 500 TV channels and an increasing apathy toward traditional media.
- When they do shop they actively seek product information in the form of POS marketing materials which have effectively become the newest form of mass media.
- And today it is not uncommon for shoppers to make frequent, single-purpose, shopping trips — each one requiring persuasive information at the point-of-connection between shopper and product.
Craft beer, initially out of necessity, couldn’t afford a national or regional traditional media marketing campaign. They relied on word-of-mouth, social media and POS marketing to promote their products. It has been unexpected that many big brand beer distributors are willing to invest in POS marketing for the craft brands they distribute.
Of course, the reason the traditional beer distributors are willing to spend on POS initiatives for the craft brands is that most craft beers have higher gross margins than the brands from the Big Two suppliers.
So now that craft has proven to be more than a flash in the pan, the Craft Brewers themselves are able to support their distributors POS marketing programs with bill-backs and ever improving co-op programs.
Both Big Beer and Craft have learned that the ability to effectively market at-retail has become vital. At-retail marketing can no longer be thought of as a necessary evil; rather it must be the foundation for all consumer goods marketing initiatives going forward.
The New Normal
The new-normal for Big Beer and Craft Beer marketing is to focus on the shopper where they can become a buyer and today that means make your mark at the point-of-sale.
Assuming the Big Two get passionate about POS marketing, I wouldn’t count them out. Of course it would also be helpful if, as the Huff Post says “. . . if the Big Two would develop new, better tasting beers or acquire more brands.” (See Note 1),
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Note 1: “Craft Beer Output Could Eclipse Anheuser-Busch & MillerCoors Before 2050 If Trends Continue”; http://www.huffingtonpost.com/2013/03/19/craft-beer-output-trends_n_2903596.html
Note 2: “The Power of Marketing at Retail” - Point of Purchase Advertising International (POPAI); http://www.popai.com/research-library/?did=2