Liz Morrell examines an in-store media sector that has learnt from past mistakes and is pressing ahead with numerous innovative projects

Retailers’ use of in-store digital media used to be rather archaic with expensive screens hung high out of view of customers and content that was of little relevance to them and so was largely ignored. But that is changing. Hardware prices are tumbling, management software is becoming more sophisticated and accessible and content is becoming more targeted and relevant and therefore of more interest to the consumer. The result is that for many retailers it is becoming a vital part of their in-store communications strategy and both retailers and customers are beginning to sit up and take notice of what’s onscreen.

Done correctly in-store media really can drive customer interest and help persuade shoppers to part with their hard earned cash. But it needs to be integrated and relevant. Jonathan Southcombe, managing director at retail media agency ABC Media, says the problems have been that retailers haven’t combined the elements of all into a cohesive marketing strategy. “The mistake of the past was that too much emphasis was put on digital channels.”

At the Co-operative Group the use of in-store digital media - including screens and radio from ABC Media - is a vital component of the company’s marketing strategy and the retailer now has screens in 3,000 of its food stores and is near completion of a roll-out in its pharmacy chain too. It is the largest screen based network in Europe. “It’s the in-store digital channels that are really leading the way for us - they are engaging for customers, have shorter lead times, near 100 per cent compliancy levels and are incredibly affordable, making them cost effective alternatives to their above the line counterparts,” says Susan Beetlestone, head of commercial marketing at the Co-Operative Group.

And others are following. For supplier Amscreen, which has screens in 2,300 sites across the UK, neighbourhood convenience stores are the company’s next focus, having successfully rolled out in the petrol forecourt market. To date the company runs screens in the likes of BP and Esso and is also rolling out to Shell. Now, with a number of convenience store trials underway convenience is the next target. “The attraction to us is that from an advertising point of view it has all the products of the forecourt market as well as more FMCG brands too,” says Simon Sugar, CEO at Amscreen.

Amscreen supplies the plug and play screens and the advertising. “Our main focus is owning our own networks. We aren’t interested in just selling hardware. We want to become a major media owner,” says Sugar. “We put screens in at low cost and then the retailer has 20 per cent of the loop time which they can use to promote different messages and we use the rest for rate card advertising.”

But like Tesco TV it has been done before with a failed venture called Forecourt TV - here screens were hung outside stores, there were problems with sound, glare and the practical problems of large vans knocking such screens off. Today lessons have been learnt. “It needs to be fit for purpose creative,” says Guy Chiswick, commercial director at Digicom.

Marc Mendoza, CEO at Media Planning Group, says the message must be relevant and targeted to ensure it is not ignored. “If you have customers you want to influence at the PoS, it should tell them something they don’t already know and give them something new that takes into account their state of mind at the moment of delivery. It’s got to be promotion or offer-based - it can’t just be a brand medium,” he says.

Darren Turrell, director at in-store digital media experience consultancy The Embryo Studio, thinks otherwise. For some retailers he believes that digital in-store media can help to enhance the image of the brand - especially in fashion retailers where the creation of mood can be all important. “You have got lots of technology companies selling screens and people trying to sell advertising but you can use it to enhance the brand experience. If you take Hollister, they have been really bold with in-store media. They have screens in-store but they are not throwing advertising at it - it’s a beach scene that changes during the day. They are the sorts of people that are using digital media to create the right vibe to create an environment as a whole,” he says.

Content also needs to be relevant and updated - which is after all the beauty of such systems. “In a lot of cases it’s not integrated so you go into retailers and look at the screens and it’s all a bit bland because a lot of TVs are being run off a DVD player. But if you have a real-time system running then you can react immediately and it makes for a better shopping experience for the customer,” says Lewis.

And digital also allows much closer targeting too - for example, advertising products only during certain times of the day or targeting advertising by postcode or applicable stores. “Retailers and advertisers love it because it’s a very easy template to send across and you can do time specific targeting so messages can be tailored by days of the week, time of day or geographical location,” says Chiswick.

Advertisers are also increasingly learning what works. “The loop has to be varied and interesting and long enough for the dwell time - so in forecourts it’s 90 seconds loop with 10 second adverts and in healthcare it’s 20 minutes and the messages are longer,” says Chiswick. “Sound doesn’t really work because if staff are hearing the same message again and again they will just turn it off.”

Of course, advertisers also want to see results and the provability of such a medium in the past has been a sticking point. This is also changing. Earlier this year Digicom commissioned a number of studies into the effectiveness of digital signage. Exit interviews in forecourts in March showed that 82 per cent of customers had seen an ad and 73 per cent said they would act on an onscreen prompt. A face recognition trial showed that the screens were getting an average 94 per cent sight rate over an ongoing two month trial. And more importantly this is translating into sales too. EPoS studies by Digicom showed the medium delivered sales uplifts of between 20 and 50 per cent for brands including Red Bull, Lucozade and Aero.

Beetlestone says advertisers are responding well at her business too. “This year we have found more and more of our suppliers are engaging with in-store media. I think this growth is a real sign that retail media has found a place in the marketing strategies of consumer brands - who are finding that not only are their campaigns able to educate and inform customers but that these communications are also translating into sales,” she says.

The retailer recently commissioned independent research to measure the effectiveness of retail media using econometrics modeling and found that multi-channel retail media made a measurable difference, enhancing the effects of promotions by an average of 25 per cent. Furthermore over the two years of the study retail media had generated over £13.4 million worth of incremental sales. “Of these results it was the digital channels and in particular radio which stood out: radio delivered on average a 30-40 per cent higher uplift for every £1 of media compared with other in-store channels,” says Beetlestone.

Under review

Yet despite its success in the smaller sectors the larger retailers still have to reinvest in major roll-outs. A trial running last year with Asda has now ended and although the retailer says it’s “under review” it is understood it won’t be rolled out currently.

A similar trial at HMV at the retailer’s ticketing kiosks has proved more successful, however, with 25 screens in the larger regional or flagship stores and the retailer is hoping to add more in appropriate locations. “The screens are important as part of our ‘close-proximity marketing’ as they help the hmvtickets offer stand out more in-store and really bring the ‘content’ on offer - the gigs, shows and events to life. It helps to make hmvtickets more three-dimensional, and the screens undoubtedly help cultivate customer interest - promoting particular ticket deals and availability but also making the public aware that we are now a growing outlet for tickets,” says a spokesman for HMV. Amscreen has also just signed a five-year deal with WHSmith Travel to roll-out digital signage in its airport and railway stores.

Many believe the challenge is that the larger retailers are more protective of their brand and the messages onscreen and therefore want to run such networks themselves but are hesitant of repeating the failure of Tesco TV.

Technology already exists that could further revolutionise the in-store media experience, such as mobile screens on trolleys that could prompt customers with offers and even countdown the availability of such stock in-store, or screens on aisles that could screen adverts targeted solely to the customer standing in front of that at the time. “All the technology exists but it still costs a fortune,” says Chiswick.

The Co-Operative is moving forward. “We have being putting a lot of time into developing our digital opportunities and have recently seen some real excitement around our digital Pin Pad Insight channel, launched this year, which allows brands to communicate to our customers and get feedback from them at the touch of a button,” says Beetlestone. “Using the Pin Pad device at tills, consumer brands are able to pose a short question to the customer over a week and get up to half a million responses - this is a great way of not only raising awareness of new products and initiatives but also finding out what customers really think.”

Chiswick believes the revolution will come because customer needs are so well served by digital in-store media. “Shoppers want four things - they want to know about new products, price and promotion, usage ideas and help me choose. You can deliver all of those far more efficiently through digital than on a static poster,” he says.

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