Understanding Point of Purchase Displays

Understanding Point of Purchase Displays

Retailers are always looking for a competitive advantage.  It’s the difference between a thriving retail operation and one that flounders and dies. This is especially true for traditional retail businesses that are heavily invested in brick-and-mortar stores.

Today, retail store chains find themselves in crisis mode. They face ever-shrinking margins, lower foot traffic, and fierce competition from e-commerce retailers. It’s no surprise that big-name retailers have been closing unprofitable locations, and reducing the footprint of many underperforming stores. All this is happening as e-commerce sales continue to grow, year after year.

Retail store chains are now fighting back with new flagship stores where shopping is more of an event. These destination stores are brimming with technology. They feature free WiFi, interactive kiosks, and massive video walls.  The idea is simple, encourage people to come out and shop by delivering a more pleasurable experience. This is leading to a store design revolution where more time is spent on creating a more positive, and engaging environment for shoppers.

Top retailers realized they need to fight fire with fire, so they are investing massively in modern e-commerce websites, social media, in-store technology, and retail digital signage.

Traditional POP signage is on the way out

Point-of-purchase displays have traditionally been based on printed material.  Stores would order batches of signs for promotions, and swap the signs out each time a new sale came along.  It was an expensive process, especially for smaller operators who couldn’t order in very large quantities.  As print technologies evolved, smaller print runs became more cost-effective.  Signs could also be printed more quicker and you could choose from a variety of substrates.  This is when cardboard gave way to plastics, which was great for printing outdoor signs.  Inks became UV resistant so they wouldn’t fade quickly, and the introduction of vegetable inks made POP signage eco-friendlier.

However, many problems remained.  The cost of shipping and disposing of all this printed material remained very high.  Printed signs also require a lot of handling, and they often get damaged so there is a lot of waste.

It’s important to note that retail is mostly a seasonal business.  Signs go up with each passing season, and must eventually come down to make place for newer signs.  It’s a continuous cycle that takes its toll on a retailer’s bottom line.  If only there was a better option…


Digital signage is the better way

Digital signage displays are showing up in stores all over the country because they address many of the issues related to printed POP signage use.

For example, digital signage content is managed centrally and can be deployed instantly over any number of networked displays.  Displays can be geographically distant without affecting content delivery.  Content distribution is achieved at a fraction of the cost of shipping physical goods across the country.

While the cost of rolling out a digital signage solution may seem high at the onset, retail store chains save on operating costs over the long term.  We shouldn’t forget that even the most remote regions now have reliable internet access, and the cost of the required hardware is constantly shrinking.

Operationally, digital signage offers a lot of advantages over printed POP material.  Content can be swapped out based on predefined schedules, programming rules, or on the fly.  Changes are made and deployed instantly.  The quick and easy distribution of advertising material and POP content is digital signage’s greatest strength.

Digital signage always shows the correct price

Accurate pricing is another huge win for retailers who rely on digital signage for points of purchase. Large retail chains have always relied on detailed pricing strategies to respond to competitive pressures. Pricing is often adjusted per the number and type of competing stores within a certain area.

In the past, stores may have received printed material with the wrong prices due to a shipping error. This material had to be shipped back or destroyed at the retailer’s expense. Digital signage virtually eliminates these problems by extracting the correct pricing directly from each store’s point of sale (POS) system. Pricing can easily be adjusted based on inventory counts, competitor activity, weather, or any number of external factors.  This process is seamless and can be fully automated.

Retail store chains can also adjust promotional pricing dynamically and deliver this content to stores that need it. Sales analytics can be matched to each display location to better evaluate the success of each campaign, and help guide future promotions. Feedback is virtually instantaneous so merchants can adjust their activities for each store location.

The speed at which sales performance data becomes available is invaluable when testing out new products, services, or pricing strategies.

Personalize Programs From Smartphone

Digital signage can be reactive

Interactivity is the new trend and retail digital signage has adapted by providing support for touch-enabled displays, and external sensors (such as RFID, motion sensors, webcams, Microsoft Kinect sensors, and many others).

Many store chain owners use RFID tags embedded in product packaging and pricing labels.  When equipped with the proper sensor, data is sent to the digital signage CMS which then triggers a matching product advertisement on the screen.  Say someone walks near a display with a pair of socks, and an ad for a matching tie appears right in front of them.

Depending on the technology used at the store level, content can be triggered by motion, proximity, the weather outside, or any number of factors.  For example, ads for umbrellas are automatically triggered on a rainy day, or products instantly show a 10% discount if stock levels are too high.

It’s one more way retailers can use digital signage to deliver a better and more memorable experience for shoppers.

Stores with loyalty programs can also use data to further enhance the ads and promotions that are presented to returning customers.  When fed the proper data, digital signage displays will adapt and deliver relevant information that customers can use.  It’s all about bringing back shoppers and making sure they keep returning.

Fighting the showrooming phenomenon

Brick-and-mortar retail stores must deal with guests who use their smartphones to cross-shop with online retailers. Amazon’s app even features barcode scanning so people can call up prices and compare them with the physical store pricing. This phenomenon has led many traditional retailers to create their own apps, but this doesn’t address the whole issue of e-commerce competition.

Some retail store chains have implemented an e-commerce price-match policy. Stores feature digital signage displays where they advertise when certain products are priced below their e-commerce counterparts.  These stores run their own periodic price checks and publish the data in real time.

By combining a digital signage CMS, media players, and SQL databases, retailers can level the playing field to compete with e-commerce.

The future of digital pop signage

Digital signage software is constantly evolving, and every year brings exciting new possibilities.  We’ve already seen wireless shelf-front LCD price tags that continuously update themselves, fine-pitch LED panels that can cover entire walls both inside and outside, transparent and circular LED displays…

Some technologies stick, while others fail and die off. Remember glass-less 3D displays?

This year’s hot trend is system-on-chip (SOC) displays that integrate the media player hardware into the display itself. Think “Smart TV”, but for commercial applications.  This will help lower deployment costs and provide a cleaner installation.

So, what comes after this? Nobody knows for sure. Stay tuned!