It’s a startling admission, but 63% of retailers do not measure the implementation of point-of-purchase material, according to IGD research. With total expenditure on POP standing at £1.15bn and more than a third of supermarkets failing to place promotional material correctly, brand manufacturers are throwing at least £400m down the drain each year.
Add in the cost of employing a field marketing company to help suppliers achieve compliance for POP deals that have been agreed at a supermarket’s head office, and it is no wonder this issue raises hackles. Especially when recent research from Storecheck Marketing shows that stores with small, shelf POP achieved 20% more sales than those without, while those with off-shelf activity saw sales up to six times greater than those not making use of such material.
To give food retailers their due, there is no doubt they are putting more effort into in-store compliance. Tesco has revamped its store staff structure, with team leaders charged with ensuring POP directives from head office are implemented.
Meanwhile, Sainsbury retail director Ken McMeikan is pushing through a number of initiatives as part of his strategy of putting stores back at the heart of the business (The Grocer April 9, p8). The company plans to review all in-store compliance in order to make implementation simpler. But suppliers shouldn’t wait to see if these initiatives have any effect. There are steps they can take now to achieve better POP material compliance. The key is to understand supermarkets’ attitudes to POP and what types of material store staff are most likely to install - or not.
Industry association Point of Purchase Advertising International (POPAI) has conducted a new study into just this. It asked Storecheck Marketing to interview managers at 120 of the top 700 stores by turnover across the UK. According to ACNielsen, these 700 stores represent half of UK grocery turnover and therefore manager attitudes are likely to have the most impact on sales.
“Store managers’ attitudes make a difference, but our research shows they are sensitive to head office views on POP,” says Storecheck MD Colin Harper.
“Brand owners need to work to improve managers’ attitudes to POP. If they know the uplift in sales that will be achieved by placing POP they are twice as likely to do it.”
Highlighting current thinking, one store manager says: “I will not use prepack shoppers or flatpack bins/units as I consider them unsafe and poor for POP purposes. I also bin shelf units as I consider them useless and in the way.”
Head office attitudes to promotional material tend to go in cycles and at the moment it appears they are in a negative phase. Both Tesco and Sainsbury have clutter-free policies. This means they accept that off-shelf material has a place but a ‘one-size-fits-all’ policy is not appropriate. Therefore, at head office they are trying to match what stores receive to what they actually need.
Asda takes this a step further, with a clear floor policy under which no off-shelf units should be placed. However, Harper points out there are exceptions, especially in areas where there are major launches that will fail if not immediately supported.
“Store managers will still put out some material as they couldn’t cope without it. For example, in DVDs and videos there is a huge instant demand that needs immediate support,” he says.
With managers sensitive to these head office policies it is vital brand owners appreciate the requirements of each retailer.
“The research shows the tailoring that needs to be done between the different retail groups,” explains POPAI director general UK and Ireland Martin Kingdon.
“Head offices are more sophisticated at determining what is right for them. They are distributing guidelines to store managers to stick to, so it is more important than ever that brand owners get retailers on board when it comes to the unitary they wish to place.”
POPAI’s research finds that flatpack shippers and dump bins are the least-favoured forms of POP display. Those interviewed for the study commented that they were “too time consuming and fell apart after half an hour”.
Compliance with these units was a paltry 40.73%, down from 57.19% when the same research was last conducted in 2002. While brand manufacturers seem to love these units, especially for confectionery and snacks, they would be wise to reconsider their use - or else work harder to communicate their benefits to managers. Freestanding permanent unit compliance declined by nearly 5% to 61.37%.
However, compliance among supermarkets varied significantly. Tesco’s strategy of giving stores only what they can use is clearly having an effect. It reported an 8% increase in placing such units, to 76%.
But Sainsbury’s approach does not yet appear to be paying off, with compliance of units falling a quarter in the past three years to 51%. Asda and Somerfield are also poor performers, although in Somerfield’s case it is hardly surprising given one manager’s words: “The same size shipper for large and small stores means that the smaller stores end up with excess stock.”
Store managers prefer prepacked units, although across the board there was a slight decline in compliance from 73% to 71%. Shelf trays are becoming more popular, as is shelf-ready packaging. “These are getting placed because of their suitability and brands are making more effort when it comes to shelf-ready packaging, making it simple and easy for the retailer,” says Kingdon.
Small, shelf-edge material does well compared with others, at 73%, but is down from 85% in 2002. Of particular annoyance to store managers are shelf wobblers, which create problems in removing the glue.
Hanging signs are also in decline. Supermarkets’ in-store screens are taking on this role in some chains while both Tesco and Asda head offices have directives against corporate hanging signs, which can interfere with security cameras.
When it comes to supermarkets’ individual performances on POP compliance, Harper says Asda continues to be one of those at the bottom of the class. However, the chain’s increasing commitment to promotions through its EDLP+ strategy may facilitate a change in individual store managers’ attitudes.
According to Harper, there are already signs that POP is moving higher up Asda’s agenda. And back in August last year Asda media centre director Sarah Brookfield indicated the retailer was ready to consider suppliers’ requests for greater in-store visibility, including POP material.
It is Sir Ken Morrison, however, who receives a much-needed pat on the back. While tales of infighting at head office splash across newspapers on a daily basis, it is clear that Morrisons’ stores are as focused on detail as ever. Having recently won The Grocer 33 award for availability, POPAI’s research found Morrisons is also best in class for POP compliance, achieving 100% in shelf trays and shelf-edge material and above 85% in nearly every other form of promotional display in its core stores.
The retailer has also succeeded in doubling compliance with some types of POP in Safeway stores. Indeed, Safeway is second only to Morrisons in most categories.
“Safeway’s compliance has improved exponentially,” says Harper.
“Morrisons puts a great deal of focus on getting this type of thing right and it shows that head office’s attitude does have an effect at store level.”
The positive impact POP advertising has had on sales is well documented. Brand manufacturers desperate to influence the shopper at the point of purchase face a stark choice: continue to chuck away millions by doing what they have always done or channel their energies into understanding what works for store managers. Above all, they must explain why managers will benefit from installing their POP material.
Says Harper: “If managers are convinced that POP is a good idea, they will go out of their way to place it. Brands need to convince them.”
>>An a to z of in-store promotional tools
n Flatpacked dump bin: The most common style of shipper. Takes up minimum space in transit and usually will be used for only one promotion.
n Freestanding units: Semi-permanent displays, typically designed to have a life for more than one promotion, and made from plastic and metal.
n Hanging signs: Usually made from card and, as the name implies, designed to hang from the ceiling.
n Headers: Large card items, attached above a shelf or gondola end.
n Prepacked shippers: Distributed with product either attached or inside the unit to ensure sufficient stock is available when it reaches the store. This does not guarantee placement, often because the store cannot take a shipper of its size. Usually made from cardboard and designed for a single promotion, they tend to be much more expensive to supply than flatpacked shippers.
n Shelf talkers: Card items that either go along a shelf or project at right angles.
n Shelf trays: Usually made of plastic but sometimes from card, these are designed to sit on a shelf and hold product while promoting the items on sale.
n Wobblers: Hang off the front of a shelf.