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How to Measure Your Retail Display’s ROI

November 28, 2017

How to Measure Your Retail Display’s ROI

How to Measure Your Retail Display’s ROI. As with anything in life, you get out of it what you put in. This axiom is particularly relevant in the marketing world, where ROI is key and directly related to the quality of the marketing tactic and the thought put into the design and execution.

Today we’re talking about retail POP displays and how to measure the ROI of these potential-laden but sometimes-polarizing sales tools. Why polarizing? Because most brand marketers see POP displays as a cost (burden) instead of an investment (opportunity). Consequently, those who find them “burdensome” tend to put less effort into the display’s design, with the end result not performing to its maximum. Sort of a self-fulfilling prophecy.

So how can you measure the ROI of your retail displays and become a believer?

Promotion Program Value (PPV)

As the name implies, PPV measures a promotional program’s value. How does it do this? With a simple formula

  • Count the number of stores that used POP displays to enhance your retail merchandising efforts
  • Determine the topline sales increase that each of these stores earned while the display was active. Then add all of the stores’ topline increases together.
  • Divide this total by the POP display’s unit cost (manufacture, pack, transport, setup, take-down)

A recent study conducted by an established industry research company cites $53.76 as the average cost of a POP display, with every dollar spent yielding around $4.99 in incremental sales. The resulting PPV is close to 499%, which is fantastic.

Net Revenue Divided by Investment Cost

A more traditional way to measure your POP displays’ ROI is to divide net revenue by investment cost. This is typically done on an annual basis. For example, in one year you spent $5,000 to execute all of your POP display initiatives. Your net annual profit was $50,000. This translates to an ROI of 90%, or a return of $9 for every $1 spent on your POP displays. This is a compelling number, especially if your POP program for year two mirrors that of year one. Everything is designed the same, which means your tooling costs are nil, resulting in an even greater ROI in year two.

Why POP Displays Should be Viewed as Investments, Not Costs

Along with the math laid out above, there are several other reasons why you should consider your POP displays as investments and therefore put full effort into their design and function:

  •  Your brand will enjoy increased awareness
  • Your POP display can give you access to stores in which visibility would be impossible without a display
  • Your products will enjoy stronger merchandising and thus increased appeal
  • All of the above add up to increased sales

When you consider that the average consumer is exposed to 3,000 marketing messages every day, and that 30,000 new SKUs hit the market annually, competition is fierce. Plus, retailers are increasingly selective about a POP display’s design and quality, wanting it to be the right fit for their store’s layout and customers. The right display can impact a consumer in as little as 3 – 5 seconds. Is the argument in favor of the “POP displays = an investment” airtight? You bet.

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Successful POS Design Pushes Traditional Marketing Strategies To Another Level. Point of Sale marketing in 2018 took traditional marketing methods – unique design, eye-catching presentation, effective branding with clear messaging, a clear tieback to existing consumer advertising, targeting emotional triggers, and an awareness of the shopper's journey – and pushed them to the limits of creativity. Studies in point-of-sale effectiveness showed that in 2016, properly leveraged marketing initiatives resulted in an average of 9.2% sales lift and that 40% of shoppers recalled the merchandising displays. As marketing has become more complex, these numbers have improved, and it’s been found that the most successful campaigns didn’t prioritize one method over any other but rather ensured each factor was leveraged to the fullest to maximize the impact of the overall strategy. Marketing is More than Matching Form to Function Across every industry and market segment, setting your brand apart from the competition is a fierce and driving force that informs every business decision. The process of marketing is no exception – companies everywhere have come to understand that customers can get whatever service you offer from a myriad of sources, so a successful marketing plan can usher consumers beyond any concerns of quality and focus their behavior on the one thing you can control: the journey they take in buying your product. Don’t Think Outside the Box, Leave the Box at Home Successful creative marketing approaches break down the boundaries around how consumers expect to consume and interact with your brand. Bold, compelling designs, larger-than-life displays, interactive or dynamic displays, and point-of-sale media that not only showcase the product but draw the user into the unique experience your brand has to offer. And don’t stick to only static floor installations. Explore shelf edging, ceiling-hung displays, or signage and displays for register counters. Approach your marketing without limitations on space and location, and open the door to all of the possible ways to engage consumers. Show and Tell with Clear Branding and Messaging While creativity is necessary, clarity is just as important. The last thing you want consumers to do is look at your POS branding and either not be able to tie your product to it, or worse, not understand the message you’re trying to get across. Your brand should be front and center, and the supporting messaging or call to action should cleverly play into your brand without straying too far afield. An energy drink display modeled after a refueling jet or a gas station is not only clever and engaging, but on-brand and appropriate. A display focused on your brand’s new chocolate bars combining imagery of clowns having a party on a yacht inviting consumers to dive in? Memorable, sure, but in none of the right ways. POS Displays are Breadcrumbs on the Trail Back to Your Brand A cohesive marketing campaign requires your point of sale materials to tie back to your overall brand image and message. As with the example above, great POS displays tell a story and paint a picture consistent with your brand presence across all mediums. Think about it from the perspective of the Apple aesthetic, where you can instantly recognize the sleek minimalistic design of an Apple product. Consumers should be able to see your branding anywhere – the store, online, on a billboard – and instantly recognize consistency in your messaging and presentation. Disrupt Routine with Emotion Let’s go back to the crucial element in marketing that successful campaigns take into account: the market is oversaturated, no matter the market niche to which you cater. All of the guidance discussed to this point is meaningless if you’re marketing department cannot embrace this one guiding principle: you’re not selling a product or service. You’re selling what it feels like to engage with your product or service. You’re honing in on the emotions and the place your product should hold in a consumer’s life. Your material must embody that aesthetic, that a lifestyle where your brand plays a role is the lifestyle they would prefer to anything else. Don’t Be Passive, Take Control of the Consumer Journey Building effective eye-catching, emotion-inducing POS displays for your product isn’t enough in the modern marketplace. Buying and shopping habits have shifted and more decision-making occurs before customers step foot into a brick-and-mortar retail space, requiring a marketing approach that places you squarely into the consumer journey. Engage digital throughout your marketing efforts – from targeted online advertisements that draw consumers to your brand to engaging and digital-savvy store installations that incorporate video and digital POS displays when consumers follow your advertising into the store and complete their journey to where your product is displayed. A Firm with a Successful Track Record in POS Design You want your product to stand out and make an emotional impact on consumers. You’ve created a solid branding and marketing plan, and need to find a solutions provider with a track record of success and the ability to bring your visions to life in ways that will draw consumers to your brand and maximize the return on your marketing initiative. Or maybe you’re a small business just starting and you could use some help in designing your marketing strategy to support your product. Whatever your needs might be, contact the award-winning team at Butler Merchandising Systems, LLC. today to collaborate on your next project.
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With online shopping growing rapidly, physical stores are under increasing pressure to stand out to the average consumer. Out of all the possible ways to differentiate yourself from your e-commerce competitors, visual merchandising is crucial in attracting foot traffic and driving sales.
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