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Packaging, Point of Purchase Communications, and Signage. Chapter Objectives. After reading this chapter you should be able to: Describe the elements underlying the creation of effective packages. Appreciate the role and importance of point-of-purchase (POP) advertising.
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Chapter Objectives After reading this chapter you should be able to: • Describe the elements underlying the creation of effective packages. • Appreciate the role and importance of point-of-purchase (POP) advertising. • Review evidence of POP’s role in influencing consumers’ in-store decision making. • Examine empirical evidence revealing the effectiveness of POP displays.
Chapter Objectives (cont’d) • Appreciate the importance of measuring audience size and demographic characteristics for out-of-home as well as in-store advertising messages. • Appreciate the role and importance of on-premise business signage. • Review the various forms and functions of on-premise signage. • Appreciate the role and importance of out-of-home, or off-premise, advertising. • Understand billboard advertising’s strengths and limitations.
Packaging • Both protects and helps sell the product • Packaging performs key communication and sales roles at the point of purchase in 10 to 12 seconds • The package serves to: • Draw attention to a brand • Break through competitive clutter at the point of purchase • Justify price and value to the consumer • Signify brand features and benefits • Convey emotionality • Motivate consumers’ brand choices
Packaging Structure • Gestalt: consumers react to the unified whole of the package not the individual parts. • The package is the most important part of the product. • The brand name is the most important part of the package. • Packaging Structure Components: • Color • Design and Shape Cues • Packaging Size • Physical Materials
Figure 22.2: Hypothetical Illustration of Quantifying the VIEW Model Components
Point-of-Purchase (POP) Communications • A final opportunity to affect consumer behavior; many decisions made at this time • POP advertising has grown 12% each year since 1983, with over $21 billion now spent on POP communications.
What Does POP Accomplish? • Manufacturers: • Keeps the company’s name and brand name before the consumer • Reinforces brand image • Calls attention to sales promotions • Stimulates impulse purchasing
What Does POP Accomplish? (cont’d) • Retailers: • Attracts the consumer’s attention • Extends the amount of time spent in the store • Maximizes available space • Better organizes shelf and floor space (improves inventory control and turnover)
What Does POP Accomplish? (cont’d) • Consumers: • Delivers useful information • Simplifies shopping • Sets brands apart • Informs consumers of new products and brands • HOWEVER: Consumers can be overwhelmed by excessive POP stimuli
POP’s Influence on Consumer Behavior • Informing: • POP materials alert consumers to specific items and provide potentially useful information • Reminding: • Reminds consumers of brands they have previously learned about via broadcast, print, or other advertising media • Encouraging: • Influences product and brand choices • Encourages unplanned purchasing, and impulse buying • Merchandising: • Effective and efficient use of retail space
Encoding Specificity Principle Encoding Specificity Principle Information recall is enhanced when the context in which people attempt to retrieve information is the same as or similar to the context in which they originally encoded information.
POPAI Consumer Buying Habits Study • POPAI Study Categories: • Specifically planned: intend to buy the brand (e.g., Pepsi) and actually do so • Generally planned: intend to buy the product (e.g., soft drink) and actually do so • Substitute purchase: intend to buy the brand or the product and buy something else or don’t buy • Intend to buy “Pepsi” – bought “Coke” • Intend to buy “Pepsi” – didn’t buy soft drink • Intend to buy “soft drink” – didn’t buy soft drink • Unplanned purchase: bought without prior intent
Results from the POPAI Consumer Buying Habits Studies: 1965 2012
Product Categories with the Five Highest and Five Lowest In-Store Decision Rates
Factors Influencing In-Store Decision Making • The rate of unplanned purchasing is elevated when: • Consumers are on a major shopping trip • They shop more of a store’s aisles • The household size is large • They are deal prone • Retailers benefit from having consumers shop longer and traverse more of the store while shopping
Brand Lift Defined Brand Lift Measures the average increase of in-store purchase decisions when POP materials are present versus when they are not.
Supermarket and Mass Merchandise Product Categories with the Highest Average Brand Lifts from Displays
Evidence of Display Effectiveness: The POPAI/Kmart/P&G Study • Investigated the impact that displays have on sales of P&G brands in six product categories: • Paper towels, shampoo, toothpaste, deodorant, coffee, and fabric softener • Positive sales increases materialized for all products under two sets of display conditions versus nondisplay control stores.
Encouraging Retailers to Use POP Materials • POP Materials should: • Be the right size and format to meet retailer specifications • Fit the store décor • Be user friendly • Be sent to stores when they are needed • Be properly coordinated with other aspects of the marcom program • Be attractive, convenient, and useful for consumers
Why POP Displays Go Unused • Do not satisfy the retailers needs • Take up too much space • Too unwieldy/too difficult to set up/ flimsy • Lack eye appeal • Some retailers do not believe the displays increase sales
Measuring In-Store Advertising’s Audience • Pioneering Research for an In-Store Metric (PRISM): • Is the result of an In-Store Marketing Institute initiative with Coca-Cola, Kellogg's, Kroger, Miller, P&G, and Wal-Mart • A procedure for acquiring standard diagnostics (e.g., reach, frequency, and gross ratings) for measuring in-store media performance • Gross impressions = traffic (i.e., freq.) x compliance (i.e., POP in-store use) x unduplicated audience (i.e., net coverage) • Allowed brand marketers to plan and evaluate in-store advertising (e.g., Wal-Mart TV) in much the same way as they do for print and broadcast media • Unfortunately, the project was discontinued in 2009 with the pullout of Wal-Mart
On Premise Business Signage • Considered the most cost-effective and efficient form of communication available to retail businesses • Types of On-Premise Signs: • Free-standing: monument signs, pole signs, A-frame (sandwich board) signs, portable signs, inflatable signs • Building-mounted: Projecting signs, wall signs, roof signs, banners, murals, canopy signs, awning signs
Forms of Billboard Ads • Poster Panels • Regularly seen alongside highways and in other heavily traveled locales • Bulletins • Hand painted, or computer generated vinyl images • Digital Billboards • Relatively new; represent 30% of OOH revenue in the USA; rotates ads every 4 to 10 seconds; expensive and controversial in some areas • Specialty Billboards • Use different artistic and graphical techniques in an engaging and creative way
Out-of-Home (Off-Premise) Advertising • OOH advertising expenditures in the United States amounted to $6.83 billion in 2011, with $2.05 billion devoted to digital out-of-home (DOOH) advertising • OOH advertising is the oldest form of advertising(thousands of years) • Billboard advertising is the major outdoor medium and accounts for nearly two-thirds of total OOH advertising expenditures
Billboard Audience Measurements and Other Forms of OOH Advertising • Nielsen Personal Outdoor Devices (Npods) were developed by Nielsen Media Research to determine demographic characteristics of outdoor audiences using GPS technology • Other forms of OOH advertising include: • Transit advertising • “Street furniture”
