The retail sector is subject to an increasingly competitive environment, with the number of brands growing faster than the number of sales outlets. As a result, companies are faced with the need to stand out from their competitors (and from private labels) if customers are to buy their products. Point-of-sale advertising (POS) is an essential lever in achieving this differentiation objective.
In this article, we'll look at both traditional and innovative strategies, identify the winning methods you can use with your distributors, and take a look at the best methods for analyzing the performance of your point-of-sale displays.
Point-of-sale advertising covers all in-store commercial communications designed to capture consumers' attention, direct their attention to a specific product, and thus increase sales volumes.
There are three main types of POP:
ILV, or point-of-sale information, has an informative objective. Its purpose is to communicate educational information about a product or brand, whereas the aim of POP is to promote a product in-store.
Whereas POS advertising draws consumers' attention to a product to awaken their desire to discover it, ILV offers them elements of understanding to trigger a purchasing decision.
POP is generally intended for one-off use, for example during a promotional marketing campaign. ILV, on the other hand, is often permanent. In fact, ILV will give features that tend not to change, as opposed to promotional offers.
This implies different media, depending on whether you're talking about ILV or PLV.
Last but not least, it's possible to set up displays where ILV and PLV are present and complement each other to create a better customer experience.
POP advertising can take many forms:
These displays are effective tools for capturing consumers' attention at the point of sale. They can be small or massive, depending on the events, periods or promotions that justify their use. These are the traditional tools of on-site (in-store) advertising, and most brands use them. However, the advent of new technologies has led to the emergence of new, more modern POP displays, enabling brands to present a more up-to-date image.
Finally, it's possible to assemble different types of POP. In the example below, Maped combines kakemonos, banners and boxes...
POS trends in supermarkets are constantly evolving to keep pace with changes in customer behavior and technological advances. To stand out from the crowd, a brand can capitalize on consumers' attraction to cutting-edge technologies, using innovative communication media. This is known as phygitalization.
Phygitalization, a fusion of "physical" and "digital", refers to the use of digital technologies coupled with physical supports in the commercial communication system at points of sale, with the aim of enriching the customer experience.
For example, customers can find a QR code on a display that they can scan to receive discounts when they buy a new product. Interactive kiosks are also very popular. These devices integrate a screen used either in informative mode (showing videos), or in interactive mode (clickable menu to explore different product functionalities, for example).
The integration of augmented reality (AR) or virtual reality (VR) opens the door to the creation of unique customer experiences. The use of these tools will be particularly relevant for specific products, for which an interactive and immersive experience will offer a more detailed visualization of product use. This approach aims to favorably influence the consumer, encouraging them to move on to the act of buying.
For the moment, examples in supermarkets remain limited. One example is fashion brands. Zara and Ralph Lauren have set up fitting rooms equipped with interactive mirrors in some of their stores. These allow customers to see what the garment looks like, without trying it on, and to order other sizes or even choose other colors. This means no need to leave the fitting room, saving time for the customer and reducing waiting times.
Along the same lines as the immersive experience, interactive videos, 3D models or simulations can be set up on interactive displays so that consumers can view products from all angles.
It's important to put up posters to show consumers how to use these new commercial tools. It may also be necessary to train an animator to present these new tools and encourage customers to use them. To enhance the impact of these innovative sales tools, brands are committed to promoting the benefits of virtual product experiences on various channels (brand website, social networks, etc.).
Last but not least, NFC and QR Code can be used separately or together to create a connected point-of-sale campaign.
NFC (Near Field Communication) is a derivative of RFID. NFC is a technology for wireless communication between 2 items 10 cm apart.
NFC tags can be integrated directly on products, but also at various points of sale, such as displays or posters.
NFC tags act as interactive digital portals. Consumers simply bring their smartphone close to the NFC tag to establish an instant connection.
With this simple gesture, consumers can access :
The QR Code, or Quick Response code, is a type of 2D barcode that can contain text or other types of data, such as web addresses, to facilitate access to information via a smartphone.
In practical terms, QR codes are integrated on the product itself or on in-store displays. They link to dynamic content that can be updated regularly, with promotions or product information, for example.
In the context of launching a new product in a range, the use of QR codes can enable you to create interactive and informative web pages, allowing customers to project themselves into the use of the product, thus increasing sales.
Let's say a competitor's product has just suffered a bad buzz, and you're worried that your sales will suffer: why not use the QR code to send your customers to a page featuring customer reviews.
To get the most out of your displays, it's important to know how to sell them. In fact, the objectives of your physical advertising systems and the type of network addressed (independent, integrated, etc.) will lead you to prospect different interlocutors.
Once you've opted for the right point-of-sale advertising devices and managed to sell/validate them with the above-mentioned contacts, you need to ensure that they are effectively and correctly integrated at the relevant points of sale.
Work out a joint plan with your distributors for setting up the POS. To do this, determine the campaign objectives for each party, as well as the common objectives.
Distributors and area managers know the most coveted locations, so the aim is to find common ground!
Taking into account your assortment strategy, identify which product(s) will maximize overall revenues. With this objective in mind, discuss all the aspects that will best attract the attention of potential customers. Discussions will focus on the various POS issues involved, such as how to create a product design that stands out in a busy space, how to optimize space, and how to adapt POS to the product's more or less rapid turnover.
As a general rule, manufacturers highlight an innovative or new product, but sometimes they choose a product that guarantees a good rotation with classic POP. A final case concerns promotional POP, which often involves discounting products whose stocks are to be sold off.
The logistical aspect is important to ensure that the in-store set-up is the same as that determined upstream. During their sales rounds, your area managers must carry out checks to ensure this. You can use POS elements in the form of modules which are best adapted to the constraints of available space or volume in each sales outlet. Just remember to make sure they're properly installed.
The next step is to train your area managers. They need to know what types of POP displays your brand offers, how and when to sell them, what's free, what's not, and above all the right arguments to use to sell these advertising devices.
But it doesn't stop there! The next step is to train in-store staff, especially when technology is involved. In some cases, you may need to recruit external trainers.
In the case of permanent point-of-sale displays, monitoring is carried out by sector managers during field visits. Merchandising elements are one of the points to be monitored in terms of presentation. The shelf-space survey must therefore take them into account.
For specific campaigns, the brand and its distributor need to maintain constant communication. During and/or at the end of the campaign, an analysis phase begins, enabling you to study the performance of your POS advertising, thanks to sales data and consumer behavior. This evaluation enables you to adjust the strategy of your future campaigns and capitalize on the lessons learned.
POS performance tracking is particularly useful for assessing the effectiveness of installed POS, but also of marketing campaigns for promotional POS. Where appropriate, QR codes and NFC tags can be used to collect data in real time. But analysis generally requires access to checkout data, and the use of a CRM application dedicated to supermarket performance.
Your area managers can then install the POP display, and take readings every time they visit the store to see if it's still there and installed correctly. This helps to understand whether the device has had an impact on sales. When this is the case, the department manager validates the presence of the advertising equipment on the shelf for an extended period. It's important to ask for feedback at this point. He can take photos of the shelf for a visual analysis.
During the period studied, it is also possible to analyze the sell-in to assess the increase in orders, in relation to the actions implemented at the point of sale.
Furthermore, investment in point-of-sale communication media must be justified by an increase in profits, but success is not always guaranteed! That's why a POS test will help you limit the financial risks involved, and identify areas for improvement.
This pre-test will evaluate several POS tools, examining both content and form.
Different methods are possible:
In order to analyze the repercussions of tests or the actual implementation of POP, it's essential to obtain your distributors' sell-outs. Unlike sell-in, which assesses the level of orders from the head office, sell-out gives you results by sales outlet. This is the best way to compare sales before and after the deployment of your point-of-sale advertising.
This checkout data will be used to determine ROI.
As a reminder, ROI (or return on investment) is calculated as follows:
ROI = (Investment gains - Investment costs) / Investment costs x 100
The return on investment corresponds to the profits generated by POS advertising.
Investment costs include those associated with the design, manufacture and installation of this POS advertising.
ROI will determine the financial profitability of your POS investment. In this way, it's possible to identify which communication media have been the most profitable. This will help direct the brand's marketing budgets towards the most effective tools.
The conversion rate of POP displays is essential for effective management of marketing campaigns.
In the context of point-of-sale advertising, the conversion rate is calculated as follows:
Conversion rate = (Number of conversions / Number of visitors exposed to POP) x 100
The number of conversions corresponds to the number of purchases made by customers exposed to this POS over a given period.
The number of visitors exposed to POP advertising is the total number of potential customers exposed to the same POP advertising during the period studied.
The conversion rate indicator tracks the effectiveness of point-of-sale advertising in the act of purchase.
We have seen how crucial differentiation is in the retail sector, characterized by intense competition between brands in the same sector. Point-of-sale advertising (POS) is an essential tool for differentiation, and phygitalization is a strong lever for differentiation. In addition, close collaboration with distributors is essential, and sales data analysis is a key aspect of this collaboration. Tracking performance enables us to adjust strategies for future campaigns.
