Point of purchase (POP) promotions have a profound impact on consumer’s shopping behaviour and can increase the total cost of the customer’s basket. As a result, more and more retailers are focusing their attention on their store’s point of purchase strategy.
According to an article in the Journal of Academy of Marketing Science, the general belief amongst retailers and manufacturers is that special POP displays lead to an increase in sales of products and store categories. The increase in sales for the brand featured in the POP tends to boost sales for the product category.
Before you invest in POP or rethink your POP strategy, take a look at our list of 10 things you should know about point of purchase to become more comfortable with the concept.
1. What is the Point of Purchase?
Point of purchase (POP) is a form of in-store marketing, a focal point to assist you in suggesting product add-ons or up-selling customers. POP is the area of a store which is planned and designed to capture the attention of potential buyers.
For example, promotional stands, bins, and displays used for creating excitement around a promotion. It’s the crucial point where the customer buys the product.
2. The difference between point of purchase (POP) and point of sale (POS)
Both POP and POS essentially refer to the same point – where a transaction is made, and a product is purchased.
The point of purchase refers to the larger area surrounding the cash register, the small aisle you walk through displaying the delicious chocolates, luxury nuts, and Pringles.
Meanwhile, the point of sale is where the actual transaction takes place: where the goods are scanned, bagged and paid.
3. The different types of point of purchase
Temporary displays:
Designed to last a couple of months, these displays usually feature some promotion, discount or seasonal product promotion. Displays are usually constructed from inexpensive cardboard.
Semi-permanent displays:
A display that lasts anywhere from three months to a year. This type of display is also known as off-shelf displays or secondary displays.
These displays tend to be better quality with more effort going into the design.
Permanent displays:
These are less common, built to last for years and are usually an option for major brands.
4. Why should you use POP?
You should use your point of purchase to entice customers to focus on specific products and to buy them there and then. The point of purchase displays have the added advantage of creating an additional space, a secondary display, for your products.
The ultimate goal of a point of purchase display is to grab consumers’ attention and increase their basket size, while hopefully also improving their shopping experience.
5. What should you base your point of purchase strategy on?
Customer expectation:
Promote the benefits which customers can expect from the product.
Consumer demand:
Do your research and base your point of purchase products on what your customers’ want and need.
Increased competition:
Look and see what your competition is doing, find out what works and what doesn’t and then do it better.
6. Who uses Point of Purchase?
POP is generally used by brick-and-mortar retail stores to encourage customers to make last-minute purchases. The displays are mostly provided by the manufacturer of that particular product(s) on display.
7. Your point of purchase should form part of your marketing toolbox
Your store’s point of purchase should form an integral part of your marketing strategy. Any tool that can be used to enhance your positioning is a valid approach towards communicating to your target audience.
8. How to use POP
Place your point of purchase displays where it can easily draw customers’ attention and trigger impulse buying. Use easy-to-read and simple-to-understand messaging to urge customers to buy. It is essential that you use eye-catching designs and good manufacturing quality products.
9. How will you know if POP is working for your store?
Measure your point of purchase effectiveness by evaluating your POP performance:
Impact Ratio:
Measuring the number of shoppers who look at the display, making eye contact for a sufficient period.
Engagement Ratio:
The number of customers that look at the display and then interact with the display or product – touching, reading labels, smelling, opening or testing.
Conversion ratio:
The ratio of shoppers that look at the display, interact with it and then put the product in their basket to purchase.
Lost Conversion ratio:
The number of shoppers that have put the product in their basket, but then return the product to the display and does not make a purchase.
10. Use point of purchase software
When deciding on appropriate software, insist on real-time measurement and reporting, flexibility and accuracy as a minimum.
Use field marketing to audit POP tactics, fix obvious merchandising and display problems.
Integrate category management software with your POS and craft better experiences at the point of purchase.
Conclusion
The point of purchase adds value to your customers’ shopping experience and aims to increase their basket size.
