South African network rolls out 4000 screens to 300 locations

I hadn't heard much digital signage news from the Cape of Good Hope recently, but this article indicates that there's at least one big new network in the works right now:

One Digital Media, headed up by CEO Mike Bosman, has installed a digital media network with over 4000 screens in 300 retail outlets around South Africa in the past four months - allegedly making it the largest network provider of its kind in the country. The Spar group was the first major retailer in South Africa to implement the network....

Spar has over 799 stores nationwide with an estimated 66 million shoppers. It also records up to 44 million till transactions every month. The screens are targeted at shoppers in high traffic zones in stores like entrances and till points. They are also hung over aisles, and category sections and product screens are positioned directly in front of the product on the shelf.

The network has already caught the attention of advertisers like Coca Cola, Unilever, Colgate and Cadburys, and the CEO claims to come from a background at international creative and advertising powerhouse TBWA (now TBWA\Chiat\Day here in the US). The system appears to use a conventional setup of 32 inch screens in the main aisles of the stores, though I haven't seen any install photos yet.

Tags: digital signage, south africa, in-store advertising

Nielsen to syndicate in-store marketing data in 2008

This has been a big day for us marketing at retail folks. First we heard from Deloitte that in-store marketing is growing at an even faster rate than Internet advertising. Now we learn that the Nielsen Company along with the In-Store Marketing Institute and the P.R.I.S.M Project have made, "substantial progress in a breakthrough project that will make stores a measurable marketing medium. After reaching key research milestones, Nielsen In-Store will syndicate the data in 2008, giving retailers and manufacturers exhaustive intelligence that will help them rethink in-store marketing to improve the shopper experience," according to this article on Yahoo! Finance.

The article also goes into some of the specifics of the research, noting that, "the current nationwide trial was initiated by Nielsen In-Store on April 29, 2007, and counts traffic in store aisles both digitally and manually. By the time the trial ends in late December, Nielsen In-Store will have studied more than 160 stores, capturing over 60% of the All Commodity Volume (ACV) of products in food, drug and mass retailers."

This development will go a long way toward quantifying and highlighting the value of the sales floor as valuable marketing medium. Nielsen's numbers are the gold standard for audience measurement in other media, and their name will hopefully provide an air of accuracy and fairness that non-industry types will recognize and accept.

Of course, the data that will be syndicated in 2008 won't be perfect, but provided it isn't purely fabricated it will still be better than nothing, which is basically what we have right now.

Tags: Nielsen, in-store advertising, out-of-home advertising

Retailers cut back on POP displays causing a merchandising crisis

A crisis, eh? Those aren't my words, but those of Information Resources, Inc (IRI), who report that, "consumer packaged good (CPG) companies are facing a merchandising crisis as retailers have cut back significantly on point-of-sale display space at a time when manufacturers need it most, given the declining effectiveness of traditional advertising vehicles." It's certainly surprising to hear that research indicates retailers are scaling back their efforts to market effectively in-store, especially when NBC U, Nielsen, POPAI and MARI have been working on massive in-store media tracking, measuring, planning and buying projects for some time now. But apparently as floor space becomes more valuable and limited, retailers are becoming more strict about what kinds of POP displays they'll allow CPG manufacturers to use. Likewise, retailers increasingly concerned with the in-store experience have also indicated that they want more involvement in the creative process for 3rd party POP, helping to ensure that it fits well into the overall store environment. Thus, IRI notes,

"CPG companies are buffeted by the twin problems of advertising ineffectiveness, combined with the loss of in-store display options as retailers are taking charge of branding the consumer shopping experience,” said IRI Retail Solutions and Strategic Consulting President Thom Blischok.

"'CPG companies must demonstrate that their products and merchandising programs fit into the retailer’s comprehensive growth strategies. In addition, we envision manufacturers aggressively stepping up experimentation with new in-store technologies, such as in-store TV networks, digital signage and intelligent carts to expand consumer reach in store.'"

IRI's study also points out a few other trends, including:

• An increase in trip-based merchandising (marketing towards shoppers on a particular kind of shopping trip, e.g. a quick "fill in" trip at the supermarket versus a larger weekly whole-store trip);
• Experiments with solutions-based merchandising that cross-sell multiple items (sometimes from multiple brands and manufacturers) to create an entire solution (for example, putting all parts of a meal together in a single display);
• Sustainable merchandising, which favors the use of more recycled resources and fewer non-renewable items for use in displays and promotional materials;
• Educational merchandising, where in-store pitches use an educational approach instead of a purely sales-based approach to appeal to a shopper's sense of reason; and
• High-tech merchandising, including the use of self-service kiosks and digital signage networks to engage shoppers and deliver information and promotions in a non-intrusive way.

The study also notes that the overall amount of CPG merchandising activity is declining, with more CPG companies reducing the number of displays they use, possibly because the overall lift delivered by merchandising techniques seems to be declining (the report suggests that, "nearly three-quarters of CPG categories experienced a reduction in the average volume lift achieved through merchandising versus last year.") That's pretty alarming when you consider that aside from the Internet most other advertising media are reporting the same overall trend, with consumers both actively and passively tuning out promotional material as it becomes ever more pervasive.

To solve this problem stores are not only going to have to take a more active role in getting good POP displays (and other merchandising technologies) onto the sales floor, they're also going to have to find new ways of surprising and delighting (in P&G-speak) customers. Whether this means more personalized promotions, a more elaborate in-store experience using a/v and digital signage, or something altogether different remains to be seen (and will probably vary from retailer-to-retailer).

If you're interested in the study, you can download it here.

Tags: digital signage, in-store advertising, marketing at retail

P&G redefines "ad spend" to include digital signage and other in-store media

I posted this to Retail Media News yesterday but figured it's pretty central to the (many non-overlapping) readers here who are more interested with digital signage than anything else. The long and short of it: P&G is clarifying the way they spend advertising money to include in-store media, "restating 11 years of ad-spending data in an effort to align their past marketing expenditures with their new terms and plans. AdAge speculates that the new restatement has as much to do with the company's internal goals as it does with the firm's share price, which has stumbled due to lack of organic growth and a slipping ad-to-sales ratio, the primary measure by which its growth was measured throughout the 90s and early this decade." From AdAge:

In all, P&G's restatement added $349 million to 2006 ad spending, with much smaller adjustments in other years, though Sanford C. Bernstein analyst Ali Dibadj believes the differences between the old and new definitions could have boosted P&G's reported 2007 outlays by $350 million, too. P&G said it hadn't calculated or disclosed the 2007 impact....

P&G's figures in the past 11 years show a very high statistical correlation (0.78) between ad spending ratios and organic sales growth under the old advertising definition, and an even higher one (0.87) under the new definition. For the past five years, however, the new ad definition shows a much lower correlation to sales growth than the old one.

The amount of money that P&G spends inside of stores is more than the vast majority of other advertiser s spend in total, and while the financial restatement doesn't necessarily indicate that they'll continue to broaden their reach inside the store, given how fragmented traditional media is and the difficulty P&G is having reaching new consumers, I'd venture to guess that in-store advertisements currently give them the best bang-for-the-buck. The coming challenge is going to be optimizing their presence at retail, since at any given store there's a finite (and fixed) amount of space and increasing competition and clutter from other brands (and the retailers themselves) who all want a piece of the customer's attention.

Tags: digital signage, retail media, in-store advertising

Mobile Advertising = More Intrusive = Viewers Want Free Stuff

An article in MarketingVOX talking about a new study by Universal McCann concludes that even though mobile advertising presents new opportunities, viewers are irritated by new ads on mobile Internet and TV services.

Unless, of course, they are given free stuff.

According to the article, "recent reports also suggest the world's 2 billion mobile users are turned off by tactics simply imported onto their phones from the desktop and TV. The solution to this problem may lie in offering a different value proposition to users in exchange for perceived "intrusions."

The global study found users were more receptive when they got free content from advertisers, such as branded content and opt-in Bluetooth downloads. For example, Coca-Cola gave away free songs on iTunes."

So what does this mean for an advertising world that has to increasingly up it's level of intrusiveness in order to reach constantly diverted audiences? It's simple: make the ads (regardless of what form they take or medium they're displayed on) worth viewers' time and make sure they are getting something out of them.

While the idea of free iTunes songs is great, a give-away is not the only method for making an ad worth a viewer's time. For example, it sounds simple enough, but if an ad provides a viewer some kind of genuine knowledge about a product they are already interested in buying, then they'll view it as more helpful than intrusive. While it's hard to know when a viewer is interested in a product or not, it's somewhat easier with in-store advertising, since customers are typically in the store because they want or need to buy things sold there. It's thus important for in-store ads not to rely simply on flashy, spam-like content, but instead focus on features, benefits and a useful message that can encourage shoppers to pay attention, at least momentarily. Otherwise, they'll just look the other way.

We live in an increasingly media literate society -- this is no longer the world portrayed in AMC's Mad Men. People know when advertisers are trying to sell them something, and with their new found literacy they want some respect. They recognize junk ads when they see them and are now well conditioned to simply ignore them. And while it's impossible (or at least not cost-effective) to a have a giveaway incentive for every ad, it really should be possible to up the quality of in-store media to the point where the message itself is the thing that delivers value to the shopper.

Tags: mobile advertising, in-store advertising, digital signage

VNU To Develop In-Store Measurement Service

After creating quite the commotion about it's P.R.I.S.M store media measurement technique, VNU has decided to take the service live, doing what it calls the "lead-market phase" of the new service in early 2007, with full availability later in the year. From the press release:

The new service, which will be developed through a new unit of VNU known as Nielsen In-Store, will measure consumer exposure to a fast-growing and powerful array of in-store marketing vehicles, including television and radio, shelf talkers, digital signage, and other point-of-purchase displays. Collectively, these in-store marketing approaches stand as the sixth largest advertising vehicle in the U.S., at $18.6 billion in spending in 2005.

The new service will also help retailers improve results through better store layouts, category adjacencies and product selection. “The new information we provide for retailers and manufacturers will help them work more effectively to improve the shopping experience for consumers,” said George Wishart, who has been named global managing director of Nielsen In-Store. “We also will provide the advertising, media and retail industries with a new currency standard that can increase the efficiency of the media buying and selling process.”

The same big names featured in the pilot project are endorsing the full-scale system, suggesting that early results were good. Members of the consortium include 3M, Coca-Cola, Kellogg’s, Miller Brewing, Procter & Gamble and The Walt Disney Company, as well as major retailers like Albertsons, Kroger, Walgreens and Wal-Mart.

(Cross-posted at the retail media news blog)

Tags: VNU, P.R.I.S.M, retail media, media measurement, in-store advertising