Does POP advertising really impact 75% of in-store purchase decisions?
Author: Bill Gerba on 2005-05-31 20:11:41
One of the statistics that it seems like everybody in the
narrowcasting industry
likes to throw around is the notion that 70-75% of all purchase
decisions are made by the shopper as he or she is actually walking
around and shopping. I've seen this claim made by industry
analysts, digital signage systems integrators, and competitors...and
even I myself have pointed it out on more than one occasion (though
often in the context of "hey, does anybody know if this is
true?"). So when I came across yet another article mentioning
this golden stat a few days ago, I decided it was time to do some
investigation, and see if I could find out once and for all where this
information actually comes from.
It's easy to understand why so many people want to believe that it's true -- especially in our industry and related ones, like
retail POP displays,
out-of-home advertising, and store fixtures & merchandising.
With such a huge number of dollars at stake (75% of in-store retail
purchases would have been about $975 billion in 2004 in the US alone,
according to some very dirty extrapolation of
these market statistics from
Jupiter Media),
anybody selling something to influence in-store buying decisions can
make a strong argument about ROI. But I've seen the 75% number
thrown around without any attribution far too many times to believe in
it wholesale. That, and I have trouble believing that any
arbitrary group of human beings can exhibit the same behavior 75% of
the time.
So who is really the source of this stat? Several webpages, including
this one from
Q-Matic, suggest that it was first discovered in a European Consumer Buying Habit Study conducted by
Point of Purchase Advertising International
(POPAI). After poking around the POPAI archives, I haven't been
able to find any studies by that name, nor have I found anything that
makes a direct case for the 75% number. Oddly, though, I did find
a few articles in their free research overview that are a bit more
enlightening. The first is
this overview of some of the group's more recent research efforts. Here are a few of the salient points:
Conducted
by Prime Consulting Group, the study goes further in measuring reach
and frequency in the drug store environment. Findings show Retail
Marketing delivers 6.5% in incremental sales while reaching an average
5,850 people per week. Other findings:
- 3 to 4 times greater sales lift when advertising is part of the promotion program.
- 31% of the brands study experienced over 20% sales lift
- At-retail advertising drove additional sales 70% of the time
Ok,
driving additional sales 70% of the time is certainly nothing to brush
off, but it's still not the smoking gun that we're looking for.
As close as we can get to that is
this overview of the retail marketing industry, which states that:
Serving
as the last three feet of the marketing plan, P-O-P advertising is the
only mass medium executed at the critical point where products,
consumers and the money to purchase the product all meet at the same
time. It is no coincidence that with 74 percent of all purchase decisions in mass merchandisers made in store, an increasing number of brand marketers and retailers invest in this medium (emphasis added).
There's
still no data to back it up, no studies cited, etc. But the fact
that an organization like POPAI is willing to make a claim like this is
at least a little comforting.
One final source that I was trying to track down came from
this article on Bell Canada's
digital signage ambitions. In it, the author suggests that the
J.C. Williams Group
is responsible for the 75% number, quoting John Torella, a senior
partner at the firm. I've sent a few emails to several contacts
there who have not yet been able to confirm any sources of the
information, but hopefully this will change soon :) I'll keep you
posted on my findings, and certainly
let us know if you come across any further sources of the industry's golden stat.
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