Why POS Marketing is More Important Now Than Ever Before

Store Brands vs. National Brands

During the Great Recession, shoppers learned to shop for value, shop for deals, and shop for the best products at every price-point. Shoppers learned that many products — maybe even most products at least in some categories — are largely interchangeable.  In other words, shoppers quickly learned that many store brands are both less expensive than national brands but are often reported by consumers and reviewed by ‘experts' to be of equivalent quality.

When it comes to at least one store’s brand name, ‘Kirkland’, most consumers not only believe the brand represents equivalent — or higher — quality, they also believe Kirkland brands to be of substantially higher value.

The point is that shoppers have become more discriminating and more willing and able to shop and buy smarter than before the recession.  This ‘smarter shopping behavior’ seems to be sticking around even though the economy has improved since the darkest days of 2007 — 2009.

POS Marketing Makes Smarter Shoppers

POS marketing materials provide most shoppers with the most important data points — in other words, shoppers ‘get smart’; at retail by taking in the data they require to make informed buying decisions.

For a variety of reasons fewer consumers and shoppers rely on traditional media (broadcast and print) to help them with their product research. Pre-buying research (other than that carried out by POS materials) is either done on-line, at home, prior to shopping, or in the store on a smartphone.  Of course, some of the smartphone use at retail is simply to see if the product being shopped for is offered somewhere else for a better price. But many times the smartphone lookup is used to gather product information, consumer and professional reviews and comparisons to similar products available with different brand names.

In an effort to keep the shopper focused on the brand at hand, an increasing amount of POS marketing materials (signs, displays, etc.) will feature prominent QR codes inviting smartphone users to ‘scan for additional’ product information or instant offers (digital POS, that is).

Industry Research on POS Marketing

We’ve been relying on two POPAI studies for several years now: One that states 70% of all decisions are made at the point-of-sale (1995) and a more recent study suggesting the current number is now 76% (2012 POPAI study).

A study by marketing giant Olgilvy & Mather - Shopper Decisions Made In-Store. (SDMIS) says the following:

“Shoppers know they're thirsty, but when it comes to buying soft drinks or beer they make more decisions inside the store than any other category we studied. Almost 60% of Shoppers decide in-store what brand and how much to buy from these categories". (For more details on this article see Note 1.)

And a recent presentation (Note 2) by OlgilvyAction, supported these finding that shoppers make the majority of their decisons in the store as follows:

• 59% of brand selections are made in store. Shoppers typically enter the store with a set of products and brands in their ‘consideration set’ and then make their final decision at the shelf
• 85% of shoppers perceive in-store marketing more influential than out-of-store marketing
• 77% of shoppers enter the retail store without a shopping list

What Does This Mean For Beverage Distributors?

First, for the ‘smart supplier, distributor or retailer’ it is clear that effective POS marketing is the key to providing sales increases for virtually all consumer goods marketing sold in a retail environment.

POS marketing is a critical competitive tool in the fight for shopper’s attention and to persuade shoppers to become buyers.

Second, is that the only way to deliver effective POS is to TRACK POS orders, configuration and placement; MEASURE where, when and how much your POS cost (and to evaluate and correlate POS costs vs. sales); and, also MANAGE your POS campaigns with reporting tools that give you the capability to determine the profitability and ROI of your at-retail marketing campaigns and initiatives.

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Note 1:  http://www.wpp.com/wpp/marketing/consumerinsights/shopper-decisions-made-instore/ 

Note 2:  http://www.slideshare.net/AMAChicago/shopper-marketing-consumer-packaged-goods-presentation-041912