Point-of-purchase: It’s all in the mind - New psychological techniques used in POP design could revolutionise the way brands are presented, writes Ben Abrahams

Suppose you had just taken on a marketing consultant, a respected heavyweight with a good track record. After many meetings and much cogitation, his recommendations to you are: ’Promote your competitor’s brand to sell more of your own. Then reduce the number of brands on offer to increase consumers’ perceptions of choice. Finally, limit the number of in-store promotions to increase overall sales.’

Suppose you had just taken on a marketing consultant, a respected

heavyweight with a good track record. After many meetings and much

cogitation, his recommendations to you are: ’Promote your competitor’s

brand to sell more of your own. Then reduce the number of brands on

offer to increase consumers’ perceptions of choice. Finally, limit the

number of in-store promotions to increase overall sales.’



In the face of such Alice In Wonderland ideas, you might well be tempted

to recommend that your highly-paid consultant urgently visits a

psychologist and comes back only when he or she is better.



Except that the person who made these outlandish suggestions is more

likely than not to be a psychologist themselves, and their paradoxical

proposals are, in fact, cutting-edge, state-of-the-art marketing

practice.



It is an approach based on understanding the survival techniques that

prehistoric humans developed to protect themselves against threat from

predators and to improve their hunting skills. According to the

psychologists, these are exactly the same mental processes that modern

man uses while shopping.



The new techniques - which could best be described as ’micromarketing’ -

could completely revolutionise the profession, profoundly affecting the

role of brands, how we build them and the balance between mass marketing

and point-of-sale communications.



As anyone knows who has watched Channel 4’s four-part series on

supermarket culture Shop Till You Drop, which ends this week,

psychologists are devilishly clever people. The series perpetuates the

belief that once you enter a supermarket, they use their unfair insights

to control your behaviour and make you buy things you otherwise would

not have bought.



However, the surprise is not how powerful these hidden persuaders are,

but how limited in their ability to affect our actions. ’There is this

public fear of Big Brother, that our actions are being controlled. In

fact, psychologists are relatively powerless,’ says Hugh Phillips of De

Montfort University Business School.



’They can affect behaviour only at the margin and only in the direction

that it was going to occur. Fears that people will be manipulated into

buying things they don’t want just don’t stand up. We are too

sophisticated,’ he says.



So much for one misconception. But another widespread public

misapprehension is that the supermarkets have been using psychology for

decades. It is amazing when you consider that the British retail

industry is worth hundreds of billions of pounds a year, but in reality

the ability to use psychological methods to affect people’s behaviour

in-store is only a couple of years old.



Of course, retailers have been trying to do it for years. During the 50s

there were all sorts of black-box devices that purported to explain

almost everything about consumer behaviour. But crude technology and

insufficient understanding of how the brain worked meant that these

devices were near-useless and fell into disrepute.



They gave way, during the 60s and 70s, to a more craft-based

approach.



’Salesmen would come into stores and find out what worked in terms of

display and location through trial and error,’ says Phillips. But that

learning was never formalised and was lost when sales started to be

conducted at key account level.



Then, during the 80s design revolution, store layout and merchandising

became a design decision. ’When I became interested in this area just

three years ago, I assumed that it was well documented and

scientifically researched,’ says John Cox, of De Montfort University, a

world expert on psychology in retailing.



’But when I went into one of the major multiples and asked a senior

manager his reasons for placing the meat counter in a certain place he

replied: ’Simple. That’s where the architect located the power

supply’.’



Of course, designs would be checked out with consumers, but, say

Phillips and Cox, the results of such research would only have limited

value.



’People lie in research groups,’ says Cox. ’They make mistakes. Often

the research is done long after a shopping trip, so with the best will

in the world they will forget details. And they may not actually know

why they did or felt something.’



In any case, until very recently there was little need for the big

retailers to be too rigorous about the key issues confronted by the new

psychological approach: store layout, category merchandising and package

design. ’Until the late 80s, they could rely on growth in the market to

carry them through,’ says Cox.



Then the recession struck, growth stopped and competition between the

retailers became much more fierce. Consumers who used to know exactly

what they were going to buy suddenly became more price conscious. ’As a

consequence, people became much more promiscuous in their brand

choices,’ observes Cox.



Acting on impulse



The result is that nowadays consumers tend to defer their purchase

decisions until they are in the store. Research suggests that impulse

purchases, or more accurately unplanned purchases, now account for

between 50% and 80% of all FMCG sales, depending on the category.



’The clear implication is that the point of purchase is now playing an

important role in buying decisions,’ says Phillips.



It could even have become the most important aspect of the marketing

mix. ’You can have the most wonderful brand construct and spend millions

on persuading consumers to buy it, but it can all be wasted if you don’t

get it right at the coal-face,’ says Cox.



This fact is not wasted on the point-of-purchase industry, which is

starting to look more seriously at what makes consumers tick. Richard

Ash, director of Oakley Young, says: ’We are having to think much more

strategically as POP becomes a more important part of the marketing mix.

We’re dealing with senior marketers, who are all trying to understand

the consumer, so we have to be able to speak the same language.’



POP to the shops



Oakley Young has been working with Research International to test

consumer reaction to POP in-store and hopes to use a model to predict by

how much POP increases sales.



The new retail psychology takes a far more hard-nosed approach than

anything that has gone before. ’It just applies straightforward

principles of cognitive psychology to the shopper,’ says Phillips. So

there is no neo-Freudian interpretation of symbols or psycho-babble

about ’healing the inner child’.



It is pure, almost brutal, behaviourism.



’The issue is that a supermarket can easily contain 20,000 brands and

they contain literally millions of visual stimuli, which are simply

overwhelming.



If more than half of all purchases are still up for grabs when the

consumer enters the store, how can you help them to make sense of all

this information?’



The new approach uses cameras in-store to track people’s movements and

eye-mark recorders which show how people use visual cues to negotiate

complex displays, coupled with instant questionnaires to find out what

people were thinking seconds before. The techniques may sound banal but

the results certainly are not.



ID Magasin is a retail consultancy pioneering the use of video-based

research and psychological techniques for store design. Its research has

highlighted many shortcomings in conventional store layout.



’The grid layout is one of the worst ways that could be conceived to

move humans around,’ says managing director Siemon Scamell-Katz. ’On

average, consumers pass only 30% of the stock. Some areas are only

visited by less than 1% of customers. Queues from the checkouts block

aisles, causing people to U-dip into aisles.’



Scamell-Katz suggests that a more useful layout would be a hub and spoke

system, with fresh goods as the hub and the spokes consisting of themed

areas: children’s goods, foreign foods and so on.



The new approach shows that people spend on average one minute in an

aisle. Therefore, in an aisle with six categories and 40 brands in a

category, each brand will receive on average 0.4 seconds consideration.

’Whole sectors are not even noticed because of poor sight lines, or

because consumers are devoting their attention to negotiating crowds

rather than the shelves.’



Phillips claims that the insights from such work can have a startling

effect on sales. ’Simple re-merchandising of displays and reorganisation

of store layouts can make shops more shoppable, raising sales by an

average of 18% to 25% and increasing shopper satisfaction.’



When it comes to category merchandising, the effects can be even more

marked. For example, products have been traditionally displayed

horizontally, but vertical blocking excites the shopper’s peripheral

vision and attracts much more attention. ’We are sensitive to them

because in the past they would have warned us that something big was

about to leap out on us,’ explains Phillips.



The new techniques have also revealed that consumers negotiate fixtures

by using signpost brands - usually the brand leader. So the whole

category can be boosted by giving these signpost brands greater

prominence. ’If so, it might make sense, if you are not a signpost

brand, to promote those brands instead of your own,’ suggests

Scamell-Katz.



Less is more



Similarly, consumers often cannot see the wood for the trees. ’How often

have you asked an assistant where a brand is, only to be told you are

looking at it?’ asks Phillips.



’If there is too much choice you become confused and your mind closes

down. If you reduce the number of brands on offer, very often consumers

feel that their choice is wider,’ says Scamell-Katz.



Clearly, not only retailers but brand owners have much to gain from

these techniques, and collaboration between them is the way forward.

’Retailers understand the environment better, but often manufacturers

have a superior understanding of their category and consumer,’ says

Cox.



The rewards from employing such an approach can be spectacular. A recent

category re-merchandising collaboration between Procter & Gamble and

retailer Walmart in the US is said to have reaped dividends of increased

sales and profits of 126%. Phillips claims to have used similar methods

to boost sales at a DIY-store paint brush display by 400%.



Similarly, packaging can be made more effective by understanding

precisely what are the key triggers in your pack design. Again, this can

only be done using the new psychological techniques. ’Packs tend to be

designed in isolation and tend to be very confusing. Often there are

only two or three elements that you actually need - a colour or the

shape of a line - to communicate clearly,’ says Scamell-Katz.



At the moment, these methods are in their infancy and it is

manufacturers which are setting the pace - largely because they have to.

Clearly, improved understanding of consumer behaviour at the point of

purchase will increase the emphasis on that area. Whether or not it will

reduce the importance of more downstream marketing activities, such as

brand creation and advertising, it is too early to say.



However, it is clear that if the insights provided by point-of-sale

psychology are ignored, the classic techniques of product development,

pricing, advertising and promotion will be completely wasted.



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