WHAT'S IN STORE? 1995-07-17

CARLENE A. THISSEN

The fourth-annual Electronic Marketing Conference will be held Aug. 13 to 15 in Tarpon Springs, Fla.

When the first conference was held four years ago, electronic marketing was just starting to gain visibility. This year the conference is co-sponsored by Brand Marketing and Supermarket News. We expect at least 300 attendees. This interest level says a lot for the momentum of electronic in-store marketing.

Brand Marketing Editor John Karolefski and I will present the most comprehensive up-to-date study on electronic marketing ever done. We're in the process of analyzing the data now. We'll tell the audience how many chains and wholesalers are involved, what they do with the information and how effective the programs are for manufacturers.

Jane Perrin, senior vice president of NCH Promotional Services, will present research on consumers' involvement in the programs. In an other session, consultant Leo Shapiro will show us focus group footage designed specifically around electronic marketing programs.

Vendors will give an update. They will answer impromptu questions on topics such as the future of smart cards, the value of data base marketing, new directions and so on.

Unfortunately, some vendor updates may not be too positive. One example is Advanced Promotion Technologies, maker of the Vision Value System. As of this writing, APT has deferred the salaries of most of its employees, and is still trying to get more financing. What happened here? Manufacturers really like this product. To them, it offers everything -- instant discounts, points, audio and video ads, purchase-triggered coupons -- all in one system. APT has a master data base manufacturers can use. Manufacturers want alternatives to the current in-store electronic marketing companies.

I wrote a column in this publication in March 1994 about the mistakes other vendors made. Let's see where APT fits.

It was assumed by some failed vendors that manufacturers really wanted to jump into these programs with both feet. In fact, other than for test purposes, many were wary of electronic marketing programs. This could be part of APT's problem now. Some manufacturers are still not convinced.

The chicken-and-egg effect of these programs is often underestimated. Retailers won't participate unless there are a lot of manufacturers, and vice versa. It's possible this affected APT's success in terms of generating cash flow.

The systems involved in other vendors' programs were too expensive to support for too long without substantial brand dollar funding. In APT's case, this is probably a factor. The APT system isn't cheap. The company does charge retailers for the hardware and software, but maybe not enough.

APT went public early. According to Michael Clark, ex-chief executive of TSS, the now-defunct electronic kiosk company, "Companies should not be public until they are profitable. The overhead is phenomenal and the dynamics distracting." He will be speaking at our conference on why electronic marketing companies go out of business.

I wish APT luck. A lot of good people have worked very hard there. I hope I'll have positive things to say about APT next month.

Carlene A. Thissen is president of Retail Systems Consulting, Naples, Fla.