More than half of sales directors in grocery companies expect to spend more of their budget in-store over the next five years, according to new research.
Some 47% of sales directors questioned by Storecheck Marketing said they expected the percentage of their advertising and promotional budget spent on in-store activity to increase a little over the next five years. This included investment in discounts, listing fees and point of purchase material. A further 5.3% said it would increase a lot.
Currently 58% of the sales directors polled spend less than 10% of their budget in-store, while 10% devote between 30% and 40% of their budget.
However, over the past five years, nearly three-quarters of those surveyed had increased
their budget allocated to in-store activity. A paltry 10% said they had enough information on return on investment (ROI) to make informed decisions, while 16% reported having sufficient details on additional in-store space, such as off-shelf display units. Nearly two-thirds did not believe that they were measuring ROI properly for promotions.
“The general feeling is that, whatever happens, sales directors will have to spend more in-store,” said Rob Barker from Storecheck Marketing’s new consultancy arm, Retail Intelligence.
“But they have no idea what they will get in return for this increased investment.”
Storecheck managing director Colin Harper added: “Sales directors are looking for help. They realise they do not have enough information to decide how to spend their own budgets in order to better serve customers.”
When asked from where extra money should come for new areas of in-store activity, such as in-store TV, 58% believed it should be taken from above-the-line advertising budgets.
Siân Harrington
>>p32 In-store TV