Point-of-Purchase Merchandising history

Point of purchase advertising goes back as long as humans have been selling things to each other. The market stall, the peddlar, the hawker - all have needed to display their products to customers over the centuries. The picture (left) shows a display of horse shoes from the early 20th century. Shops were well established in the major European cities by the twelth century. Trade in bazaars and shops was important and early retailers just like today's retailers, needed to display the goods on offer. Naturally in an age before mass production, there were few consumer goods to promote. However, foods, clothing, footwear, furniture and cooking utensils were the essentials of life and for those who could afford them, goods to be bought in shops.
Retailing developed in particular in the nineteenth century as the industrial revolution made a wider variety of goods available and provided the economic wealth to enable some people at least to purchase them. Signs, posters, and means of displaying products grew but were largely hand made to serve individual retailers. The age of the chain store was only just beginning.

Some of the earliest POP displays were intended for what we would today call brand identity. The traditional barber's striped pole is one example, as is the set of pawnbroker's golden balls. Sometimes model figures would be placed outside a shop to attract attention. Before World War II competition in many areas of business was not as fierce as it is today and the retailer's needs were met by simple storage facilities for the product. simple storage facilities for the product. The celebrated retailer F.W. Woolworth and Co was a pioneer in the 20th Century. Founded in the UK as a subsidiary of an American parent company, the store introduced new retailing techniques on both sides of the Atlantic. Large scale purchasing, mass production, and modest prices were a key part of the formula but they also developed the idea of browsing before buying and set out goods for sale in a layout that enabled the customer to view touch and select items for himself. Large counters and vertical shelf units were used to maximise the display of goods and make them accessible. Woolworths used simple POP displays such as stands on which jewelery could be shown off, and by the 1950s there were display cabinets for some goods such as cosmetics. Even in the 1950s however the emphasis was on storage and presentation of goods - which would not have been recognised as a form of advertising. Combining storage, display and advertising into POP displays came later. Combining storage, display and advertising into POP displays came later. Whilst retailing developed in the twentieth century it was only in the second half of that 100 years of dramatic change that self selection retailing began to develop on a large scale. Department stores go back to the nineteenth century but it was only in the second half of the 20th century that western countries saw the growth of supermarkets.

Modern Era of P.O.P.

Since 1950 there have been huge changes in retailing as in so many aspects of the world in which we live. In particular, the change from staffed counters to self-service selection opened the field for point of purchase merchandising. If customers are free to wander around a large store at will, something extra is needed to arrest their attention. In a small shop space is limited and personal advice is likely to be more important than attention grabbing displays. As retailing developed after World War II As retailing developed after World War II retailers began to look for ways to make better use of the available floor space and to make stores more spacious and comfortable for customers. At the same time, advances in printing technology meant that a wider range of materials could be commercially screen printed with more attractive designs including pictures. The ability to manufacture attractive, eye-catching display stands that not only held stock but also presented it alluringly co-incided with the self-service retail revolution. Modern POP displays were not invented overnight but developed gradually in the 1950's and 1960s. Short term promotional material had long existed in various forms. In respect of permanent POP advertising, initially, counter-top units enhanced the appearance and capacity of counters. Free standing floor displays were a natural development from this as the concept of self-service began to take hold. Yardley and Max Factor were major brands whose owners took early advantage of the opportunities presented by POP to produce vertical display stands. Economic trends of increasing competition, more international trade, and growing consumer affluence all played a part in the development of POP advertising. In the days when consumers had little spare cash and could not indulge in discretionary spending, there was less point to POP.

So consumer affluence, technological progress, changes in retail design, and increasing competition came together as the factors that led to today's POP advertising industry. The "Charlie" unit illustrated was the first to be manufactured by Dauman Displays in the UK, in 1977. There continue to be changes in retailing in the UK and world-wide. The growth of major retail chains at the expense of independent retailers is well known. Major retail chains create and maintain their own distinctive interior design styles and often POP advertising provided by a brand owner is not always welcome if it does not fit in with the retailer's corporate image. This has meant change for POP advertising manufacturers whose products now often need to conform to a pre-determined corporate design. Future trends in POP advertising include more use of digital screens to offer moving images, more use of remote control techniques, and more interaction with the consumer.

Point-of-Purchase Merchandising in the marketing mix - some economics

Sometimes the "Marketing Mix" is known as the four Ps because the mixture of marketing ingredients can be summarised as Product, Price, Place and Promotion. The term was first used by Neil H. Borden in the late 1940's. Some add "positioning" as a fifth P. Just as a cake has not only to have the right ingredients but also to have the right proportions of those ingredients, marketing a product requires a business to plan how it will use its resources. Lookng briefly at each of these:

Product is fundamental and is the basic marketing decision of what goods or services to offer. Marketing at its most basic is about understanding markets and offering products for which there is demand. A company might launch a new gas mantle and it might be a first class product, offered at an attractive price, and promoted brilliantly. However since the use of gas lighting is minimal there is simply no mass demand for the product. No amount of clever promotion will work if the product is either not wanted or is simply no good, and successful marketing of a product starts with getting the product right. Price is well understood. Our old friends "supply" and "demand" ultimately govern price decisions. The marketer must consider prices in relation to those of competitors, and alternative ways to spend money. In wealthy countries only a small part of consumer spending is on basic necessities and the consumer often has the option of not buying a similar product at all. Place is not only about which country to offer a product in, but also about the choice of distribution channel. Selling ice-cream to Eskimos is well known to be tricky. Promotion wouldn't be needed in a perfect world in which theoretical economics prevailed. However in the real world the perfect product, right

price etc. are insufficient if the product is not brought to the attention of potential customers. Point-of-purchase merchandising is one of a range of ways to promote a product, along with traditional advertising, direct mail, websites, and others.

Positioning is about understanding the market and aiming the product at a particular segment or subdivision of it. Is our product aimed at a mass market or a part of that market that demands the best, or the cheapest?

So the marketing mix is about the right balance of all these things. Will a heavy spend on promotion make up for a rather expensive price? Or should margins be cut to the bone and little be spent on promotion. Of course, within promotion there is another mix, the mix of different ways to spend money promoting a product. Point of Sale advertising is one of these options.

Why point-of-purchase advertising works!

Compared to other forms of advertising and promotion, point-of-purchase merchandising has a number of powerful advantages. It has been estimated that 75% of consumer purchasing decisions are made in the retail outlet. This figure clearly conceals wide variation from product to product - the proportion will not be the same for basic repeat purchase items like milk, as it is for, for example, electronic gadgetry. It is likely that an even higher proportion of decisions are finalised in-store for goods bought rarely where there is a wide choice and a range of competing features on offer. This means that, for some goods in particular, the point of purchase is also the point of greatest influence on the consumer. Advertising, sponsorship, and public relations may all have a part to play but none of these influences is there, in front of the customer, at the time of decision, in the way that point of purchase merchandising is. Of course POP can be part of a promotional strategy that plants a brand name in the consumer's mind by advertising and reawakens that recognition in the in-store environment. We all know that half the money spent on advertising works, and half is wasted, but, as the old saying goes, we don't know which half. Point of purchase merchandising, however, is an extremely measurable form of advertising expenditure. A store using a prototype P.O.P. display can easily be compared to a similar store not using the display. By comparative assessment, the effectiveness of the P.O.P. unit can be measured quite accurately. This degree of measurability sets P.O.P. merchandising apart from most other forms of promotion. Point of purchase advertising can do more than advertise. It can be part of the stock control system, and it can provide opportunities for the consumer that other forms of advertising cannot. For example product testing can be facilitated, or the customer can be educated and informed

about the product's features and how it is used. With the aid of modern technology, interactive features such as touch screens can be incorporated. In summary, point of purchase advertising offers a highly measurable medium at the point where consumers very often make their final purchasing decision, the point at which it is most important to persudae them.

The Challenge for P.O.P. is to be noticed

One of the most demanding areas of the POP market place is permanent cosmetic merchandising. Brands may have hundreds of different SKU's (stock keeping units) with frequent introduction of new products and componentry. Customers want to test the products without contamination, so dirt and grime are prime enemies. Cosmetic merchandising is also subjected to the most unbelievable consumer abuseunbelievable consumer abuse
The merchandising unit has only seconds in which to create interest and persuade the customer to explore the brand further. The importance of the instant imagery that the merchandising creates is therefore hard to overstate. This will not be achieved by the product alone. In those critical few initial moments, the merchandising unit is the brand!
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Reflecting the brand imagery can be achieved in a number of ways, including lighting, colour, shape, graphics and choice of material. A good example is the unit we designed for the Karen Millen range of cosmetics in Boots. The back-wall colour and shelf down-lighting created an immediate snapshot illustration of the corporate brand imagery, encouraging further investigation. By the same token our unit for Maybelline in Superdrug used a multiplicity of graphics, some of which rotated in addition to being illuminated, simulating the hustle and bustle of the brand's New York the corporate brand imagery, encouraging further investigation. By the same token our unit for Maybelline in Superdrug used a multiplicity of graphics, some of which rotated in addition to being illuminated, simulating the hustle and bustle of the brand's New York heritage. The major national retailers of cosmetics are becoming more assertive in deciding the shape, size and colour of cosmetic furniture placed in their stores. Increasingly, it is 'one look' for all. It is therefore absolutely vital that the internal features of the units reflect the individuality of the brand image. If this is not achieved, the cosmetic houses may find that their brand does not

stand out in an environment where all of the exterior merchandising carcasses are the same for every one and valuable merchandising monies are not well spent.

Point-of-sale or also known as POP (Point-of-Purchase) advertising is category in Marketing communication specialized for sales promotion to attract shoppers. This kind of advertising serves as a promoter-reminder for the loyal customers and also can be used for promotion of special events. The goal is to create short-term impact preserving the longterm brand name and short increase of selling products. The POS communication attempts to influence customer buying decisions, and also presenting the products to new customers to convey primary brand benefits. In todays Advertising industry using the latest technology, creativity overcomes the standards. Using this kind of promotion requires careful coordination with the marketers sales statistics. This research is must-do for every Advertising agency in order to deliver effective Point-of-sales brand promotion. Most common noted results in POS promotion is to draw consumers attention to the brand that is presented. To remind and maintain purchase activity among loyal customers and attracting new ones. Also, to stimulate trial use for the promoting brand in target audience that uses competitive brands. The most important thing is to maintain the brand image that is developed already by advertising. The time frame for using POS advertising usually is predefined by the campaign and the story behind it. Also is good to know that Point-of-sale or Point-of-purchase strategy belongs to the category Direct Marketing.

According to recent research by Point-of-Purchase Advertising International (POPAI), up to 75% of purchase decisions are made in-store. With so many potential sales at play every time a customer walks in the door, most retail businesses incorporate point of purchase (POP) advertising in their marketing strategies. If you haven't, you'll find plenty of evidence below to persuade you about this powerful sales tool. To learn how POP advertising works, you need an understanding of the mental processes behind purchase decisions. In its book The Power of Point-of-Purchase Advertising: Marketing at Retail, POPAI describes the influences that govern purchase decisions. There are four steps in the process behind the decision to buy a particular item:

1. 2. 3.

A customer enters a store with a need. The motivation to satisfy that need, say with a snack from your convenience store, drives the customer to act. The customer takes cues from her surroundings to decide what to buy. The true value of advertising is found in this step. The right cues can guide a customer to a higher margin item or persuade him to buy additional items.

4.

The customer is then led to the final step - action.

Advertising is about creating the right cues to sway a customer at their time of need, which is when they are most likely to respond. Any kind of point of purchase display has the potential to influence a customer. Anyone who has been to a retail or fast-food outlet has seen point of purchase advertising. Coupons on a grocery store shelf, posters at the cash register, window signage - all of these are examples of traditional POP advertising. Digital signage is a more recent entrant into the POP advertising market. It has become popular because, unlike static posters and coupons, it offers motion and sound, which make it much more effective as a sales tool. Just look at some of the studies cited in the POPAI book:

New merchandising at a leading U.S. grocery store resulted in a 90% increase in the number of people who interacted with the display. When motion was added, sales increased by an average of 44% over sales from the static version of the same display.

A leading clothing retailer in the U.S. did a comparison between digital and static signage and found a 23% increase in traffic at stores using the digital signs. Traffic was not the only thing to increase - sales jumped by 56% in just nine weeks because of digital point of purchase advertising.

Because digital signage is electronic, it can be updated quickly in response to changes at individual outlets. With this technology you can tailor digital displays to create point of purchase advertising that aims squarely at specific customer segments and provides timely cues to influence purchases. Consider the possibilities. A department store in an area facing a sudden snowstorm can quickly highlight its selection of snow shovels, brushes and ice scrapers. Using digital signage the store could easily cross-sell anything from road salt to gloves to ice skates. Point of purchase advertising allows you to create a strong desire for your product at a time when the customer is largely undecided about what to buy. POP advertising is everywhere because it works. With the added power of digital technology, you can create point of purchase advertising that gets attention and offers an even greater ROI than conventional in-store advertising.