Mass merchants need displays
Consumers who shop at mass merchandisers make a lot of decisions about what they’re going to buy at the shelf. Getting them to buy more has a lot to do with retailers’ in-store media and display strategies and tactics. That’s the gist of the 2014 Mass Merchant Study by Point of Purchase Advertising International (POPAI).
According to the research, 82 percent of purchase decisions in mass merchants are made in-store. That’s more than the 76 percent number from POPAI’s 2012 grocery channel study. The research involved 3,000 shoppers at three major chains and included pre- and post-shopping interviews and the use of eye-tracking video.
"While we expected some mass merchant shoppers were waiting until the last minute to decide purchases, we were truly surprised to discover 82 percent of purchases decisions are made in the store," said Richard Winter, president of POPAI, in a statement.
According to the study’s findings, 34 percent of shoppers at mass merchandiser do not use a shopping list. This compares to only 13 percent of grocery store shoppers who do not make a list before heading to the store.
Sixty-two percent of shoppers in mass outlets also go without the use of circulars, coupons, direct mail, newspapers and other forms of advertising on broadcast, digital, etc. as part of their pre-shop planning.
The research findings seem to suggest that mass merchant shoppers offer a golden impulse buying opportunity.
"Displays have a huge untapped potential to drive unplanned purchases in-store," said said Kirk Hendrickson, Founder & CEO Eye Faster, an eye tracking research firm that participated in the study. According to POPAI, 16 percent of unplanned purchases in mass merchandiser stores resulted from customers interacting with displays while shopping.
Discussion Questions
How effectively or ineffectively are mass merchants at using displays and in-store media to drive impulse purchases compared to retailers in other retail verticals? Which of the mass merchants do you think is doing the best job? Why?
In general, mass merchants have “sucked” at point-of-sale merchandising. Their heritage is “rackem stackem” variety at low prices and consumers will buy.
For the mass merchant, more point-of-sale displays and better in store media represents more cost for materials and labor – UNLESS the vendor pays. Some of the better displays in mass merchants are almost wholly funded by vendors.
Target seems to have historically had the better signage and displays – probably because they are trying to appeal to their visually oriented, core customer base of women ages 17-54.
The interesting trend to watch in mass merchants is the richer in-store media and better displays in areas like pharmacy, health and services. Those areas have more margin than groceries, and drive repeat traffic of key profitable segments.
Will displays and merchandising change in mass merchants for impulse items? Not likely unless the aisle has products with richer margin (also not likely), or the price points on items exceed $50.
I see an interesting parallel between retail displays today and online ads of the late 1990s.
Remember when internet advertising used to be all about flashing banner ads, pop-ups, pop-unders, and the like? Each new tactic would work for a while, but in the end they all trained users to ignore the noise.
But then, something amazing happened: ads became more relevant, more targeted, and less intrusive. And as a result, they just worked _better_.
With the increasing ubiquity of smartphones, retailers should ask themselves: what would a digital “in-store display” look like if it were tailored for each individual shopper? Would consumers buy more from cleaner, more inviting, less cluttered stores paired with relevant, helpful, personalized, hand-held “displays”?
I think so.
Impulse still sells in stores, both online and off. I don’t think this discussion should be limited to mass merchants. I see opportunities in virtually all formats of retail. And all of those opportunities are also opportunities for CPG brands to collaborate better.
Target does a pretty good job with signage given their demographics and that’s how they differentiate their in-store experience. Sometimes I think as technologists we over-rely on technology for in-store experiences and forget good visuals and physical displays draws people, and not everything works with images/video on a digital display and smart phone. We are programmed from birth to be drawn to 3 dimensional objects, sounds and smells, and that’s where mass merchants need to think in total, beyond the technology mix for in-store experiences and displays.
The question is right on the money, Unfortunately, there is often a huge gap between what we plan (retail strategy) and what is actually executed on the floor. Measuring and tracking actual execution in real time is a must. Otherwise, you may be losing opportunities, sales and revenues.
Displays allow mass merchants to share/create a narrative to illustrate distinction. Of course there’s proof it works.
My concern is that it’s usually driven by a supplier rather than the mass merchant.
CPG and mass grocery have opportunities to capture sales from those lackadaisical customers. Endcap displays including television advertisements, LED flashing lights built into cardboard displays, and 3d interactive POS are all part of the game. For those who do not knock their basket into it, there are few that may pick up the item displayed.
Was it the display itself, or the recent recollection Oakfield item they needed? Does a display of salty snacks do better in the CSD aisle then it would in the greeting card aisle?
Location/price might be the key, but do store personnel really understand what power these displays have to increase their bottom line? While private label is taking over space,what are suppliers doing to counteract this?