IMPULSE POWER 1994-12-19

LISA A. TIBBITTS

Can brand equity be nurtured and developed in-store? Advocates of in-store advertising say it can. They point toward a host of messaging systems available in retail stores, ranging from static signs posted on floors, walls or hung overhead to satellite-delivered in-store video or audio messages.

For many brand marketers, putting the ad message as close as possible to the point of decision -- that is, in the store -- is a regular part of their integrated marketing communications strategies. Others take a strict view of the store as a place for promotions and the mass media as the place for advertising.

Keebler Co., Elmhurst, Ill., is a regular user of in-store advertising vehicles to support its cookie and cracker brands. "We are an impulse-type item. It helps give us top-of-mind awareness at the point of purchase, which is what it's all about," says spokesman Stuart Greenblatt.

Keebler uses in-store advertising to tie in with and reinforce current themes of its national advertising, freestanding inserts or on-pack promotions. "I think Keebler, in general, is becoming more aggressive in terms of marketing tools that are available to us and using more of them more creatively," Greenblatt says.

Reynolds Metals Co., Richmond, Va., reports favorable experience with several static sign vehicles from Time Inc. In-Store Marketing, New York, and Actmedia, Norwalk, Conn. "We have proven to our own satisfaction that they do have a positive impact on sales," says John Fore, promotion marketing manager.

Anheuser-Busch, St. Louis, has also tested a host of in-store advertising media. Scott Murdock, group director of advertising and sales promotion, says when in-store vehicles were integrated with advertising or promotional programs, large improvements in incremental volume resulted.

"You may be able to put a display up and see a 150% increase over normal sales, but when you add a price-off and then you add some in-store advertising to it, you may see a 1,000% increase over the same period. And we've seen numbers like that," says Murdock.

Despite such positive experiences, growth in the in-store advertising arena has generally been far exceeded by the attention being paid to in-store promotion.

The total spending for in-store marketing last year has been variously estimated at $750 million, a big jump from 1985, when the total industry pulled in an estimated $85 million, said Wayne LoCurto, president and chief executive officer of Actmedia. He puts current spending on in-store advertising media alone at about $100 million, with the balance of spending devoted to various promotions.

Brand marketers debate the merits of in-store advertising every day as they make decisions about where to best apply scarce marketing dollars. One reason for their greater emphasis on promotions is an insistence on measurable, short-term results, a bias LoCurto insists is short-sighted.

"Nobody runs one ad on 'Roseanne' and then comes back and says, 'Did we get an increase in sales?' But they're willing to take that same amount of money, put it in the store where they can measure it and look for pay-out," he says. "Well, advertising doesn't pay out on a single exposure basis, in many cases."

Dick Blatt, executive director of the Point of Purchase Advertising Institute, Englewood, N.J., says the use of in-store advertising media may have slipped in the past several years as manufacturers have concentrated instead on in-store promotions, but he stresses that advertising in stores remains viable.

"POPAI believes that that segment of the industry certainly has a future," he says.

Users and providers of in-store media say that its messages are most effective when used for items that are high-impulse purchases. Keebler clearly has seen and used this opportunity in its snack foods business.

It can also work well in categories such as coffee and laundry detergent that offer several equally acceptable brand names to consumers. Added information, either on signs or in the form of informational leaflets, can provide the final push to a long chain of advertising messages and overlays designed to guide the consumer to the "right" purchase decision in the store.

Pepsi-Cola Co., Somers, N.Y., was one of four brand marketers that participated in a pilot test this summer of a new Floor Graphic from 3M, St. Paul, Minn. In shopper testing, the ad vehicle -- a vinyl sign that adheres to a retailer's floor -- created significantly improved consumer awareness of participating brands, 3M reported. Other brands that participated in the pilot were LifeSavers candies, Trident gum and Energizer batteries.

The 3M test ran at about 60 Stop 'N Go convenience stores in the Houston market. Pepsi spokesman Chris Romoser said, based on the results, the company believes the floor signs have good potential to work in concert with the company's multilayered advertising and promotion message. "It definitely added another presence to the account," he said.

Relatively uncommon is the approach sometimes used by Campbell Soup Co., Camden, N.J., which, according to Actmedia's LoCurto, has used in-store ad media to sustain brand equity during periods when it did not have additional promotional or advertising campaigns ongoing.

Reynolds Metals' approach is more conventional. It uses in-store advertising to augment its promotional or advertising programs or to introduce new packages and products. "We see it as a complementary, not a stand-alone, activity," Fore says.

Greg Forman, vice president of the Mobile, Ala.-based food brokerage Budd Mayer of Alabama, has handled the accounts of a number of manufacturers who advertise in-store. Tropicana, Arm & Hammer toothpaste and deodorants, and Kemps/Marigold ice creams and yogurts are among his principals that have tested a video sign system operated by Parker Communication Systems, Tampa, Fla., within the Delchamps supermarket chain in Alabama, Louisiana and Florida.

Forman says manufacturers have generally used the Delchamps system -- which delivers static images to video monitors via satellite transmission -- either for new-product introductions or in conjunction with some form of promotion, such as a bonus buy or display activity.

Despite the continual presence of in-store media and their prolific use by consumer goods companies, there are still many marketers who choose not to advertise brands in store.

Patrick Lynch, division manager of trade marketing at Andrew Jergens Co., Cincinnati, uses Actmedia's Instant Coupon machines and Catalina Marketing Corp.'s Checkout Coupon system -- both promotional vehicles -- but it stays away from in-store advertising.

"In terms of impacting at point of sale, we want to make it as impactful as possible, and that's where we felt the purchase incentive was the one that would have the greatest benefit to us," he explains.

Inside the store, it seems, the bottom line rules. Brand marketers who expect to see a significant sales bump from promotional activities may seem to be much less concerned about seeing immediate cause-and-effect results from traditional media advertising. While in-store advertising does pay out, the results are not as impressive as those from in-store promotions.

Mickey Goodman, a managing partner at Market Growth Resources, a Wilton, Conn.-based consultancy, estimated the average sales bump from any form of in-store ad media at 6% to 9%, whereas the increase from an in-store sampling program could be as high as 100% or 200%. Nevertheless, he strongly supports in-store advertising.

"I'd still advise manufacturers to take 10% of their advertising budget and put it in-store because I haven't seen any 6% sales increases from television advertising proven to me," he notes.

Jeff Myers, executive vice president of Time Inc., says effective use of in-store messaging vehicles will be to simultaneously advertise and promote. "I think the best in-store advertising really is a combination of both," he says. "It sells the product or makes people aware of the product for all the right product reasons, but also gives [consumers] additional incentive to do something."

Scott Riley, chief operating officer at Parker Communications Systems, says ads that run on his company's satellite network are planned to tie in with Delchamps' weekly circulars. This way the products being advertised are guaranteed to receive some degree of trade support.

Anheuser-Busch does not use in-store advertising regularly, preferring in-store promotions instead, but Murdock says retailers respond to it positively, provided it is done as a partnership. "We're looking for ways to implement this that are not going to be somehow counter to any of their retail programs or in conflict with some of their own policies," he says.

POPAI's Blatt says he does not think the in-store environment has yet been saturated. "Our sense is that consumers look for information in-store," he says. "That's really what advertising is all about: calling consumers' attention to what products and services are available and, in many cases, educating them about those products or services."