The Kellogg Co.'s use of point-of-sale materials dates back almost a century to its establishment in 1906. Over the last few years, it's placed even more emphasis on communicating its brand message in the retail environment.
"We are convinced that superior, in-store presence is essential to achieving consistent and reliable growth in sales and profits," said Carlos Gutierrez, chairman and chief executive officer of the Battle Creek, Mich.-based company.
Gutierrez's statements were made in a videotaped message to the audience of Point of Purchase Advertising International's annual leadership conference, held earlier this year. At the meeting, Kellogg received POPAI's Chief Award for success in retail-based brand marketing. POPAI, Washington, is the trade association of the POP ad industry.
The Chief Award honors marketers for merchandising excellence and strict adherence to the industry's ethical standards of practice. Past recipients include Procter & Gamble Co., Frito-Lay and E&J Gallo Winery.
Kellogg said the award recognizes its "outstanding leadership, creativity and overall effective use of POP materials" that tie in with its marketing programs.
While point-of-sale advertising is part of the company's heritage, today more than ever Kellogg wants to do the right job in-store, where the final purchase decision is made, said Gutierrez.
"In-store advertising has great strategic value and can play a key role in building brands," he said.
As more and more consumers make purchasing decisions in the store, consumer packaged goods marketers are increasing their commitment to in-store media. They are doing so through a variety of tools at their disposal, including floor ads, store-within-a-store concepts, displays, shelf signs, and in-store television and radio.
Kellogg is no different. Over the last year, it has enhanced its use of in-store media, according to Kevin Smith, Kellogg's senior vice president, marketing services.
"We realize the importance of having creative, well-timed, point-of-purchase materials to enhance our marketing programs and help increase sales," Smith said.
Kellogg relies heavily on in-store media for product introductions -- like its new Disney cereals: Hunny Bs, Mickey's Magix and Buzz Blasts -- and tie-ins to movies, including "Spider-Man."
"POS materials link our overall advertising message to the consumer in-store," Smith said. He added that a recent POPAI study showed that POP ads create brand awareness and help generate sales lifts.
While Kellogg has tested and used various forms of in-store media, it's found that some tools work better than others. Standees, shelf strips/danglers and header cards have been most effective so far, according to Smith.
But there are challenges to the process. According to a recent study, retail media is more difficult to use than traditional media buys, like television. Of 129 marketers, consultants and retailers interviewed, 35% said it is "much more difficult," while 45% said "somewhat more difficult." When asked why, respondents focused on cost and retail support, according to the study, conducted for ARC Retail, a unit of D'Arcy Marketing Services focused on marketing through retail.
Kellogg has faced hurdles as well, including retailer acceptance, distribution expenses and accurate execution at the store level. But the benefits outweigh any difficulties, as in-store merchandising has never been more important.
"Due to today's competitive market, it is essential to talk to consumers in nontraditional manners as a majority of the [impulse] purchase decisions are made at the shelf," Smith said.
When it comes to POP, Kellogg's goal is to use creative/innovative pieces that can be easily implemented in-store and leverage its portfolio of brands with the acquisition of Keebler. It is working closely with Keebler to try and gain synergies and efficiencies on producing and distributing its POP.
