Future Games: Strategies for Success

From "Buying Custom P-O-P" You've got to love Prof. Ray Burke. As the founding director of the Customer Interface Laboratory at Indiana University, he's become one of the world's pre-eminent authorities on concepts like "the store of the future." When you talk to him, however, you don't get bogged down in ideations and futurology. He's candidly critical of most attempts to build tomorrow's retail prototype today: "No real consumer would ever want to shop them," he told P-O-P Times. "They're George Jetson visions that are very technology heavy and often are not convenient for consumers." That's the problem with many prognostications, he says: They're driven by what's possible, not what's desirable. Navigating those fine distinctions will be a client-producer challenge in the years to come. For example, who should really be in charge of in-store messaging? Traditionally, most (but not all) P-O-P producers have been content to act somewhat like billboard manufacturers, engineering and erecting attractive sign frames while letting the client's advertising and/or promotions agency determine the words and images that will literally be plastered up there. Seeing this very complementary relationship, many ad agencies have, over the years, purchased P-O-P companies. And just like clockwork, a few years later, they inevitably wind up spinning them back off as independent businesses. "The two cultures could not meld," says DNI Marketing Group's Jeff Pacelt. "Neither side could figure out how to bill clients. Hourly billing by P-O-P companies seemed unworkable because clients considered them producers of biddable commodities. And the agencies certainly weren't going to start selling their efforts job-by-job."And yet, as the importance of shopper insights and the in-store arena has coalesced at all levels of marketing, many display producers are quite justified when they ask, "Who, other than retailers themselves, are actually at retailing's front lines more than we are?" Empowered by the structured partnership agreements RTC has with some of its clients, for example, this venerable P-O-P company has been able to invest in shopper insight research and add sales communications talent to the company's design team. Jeff Krepline of the Retail Integration Institute agrees: "I think our face to the customer is changing," he says. "You will see more and more of our support staff making visits to customers. A lot of CPGs focus on gaining knowledge, learning lingo, following buzz words like 'shopper marketing.' A few years ago, it used to be great if you just had the store's specs. Today, you've got to be able to talk about retailer trends and objectives. But the challenge we all still face is, 'What are you going to do with this knowledge, and how will you apply it differently?'"The idea of "partnership" is extending in all directions. Retailers want CPG companies to focus their promotional attentions less on their individual brands and more on the chain's departments. Think of all the competitors in the category as "the team," they say. Think of bringing shoppers to the aisle as the "victory." Global issues confront the business too. What is an American CPG company to make of European retailing's focus on private labels? Is that going to become the model for brand-building in the decades ahead? P-O-P companies (especially those on the West Coast) have been sourcing display components from China for many years. But when, if ever, will it be desirable to source entire display programs from the mainland? Will working through a broker/purchasing agent be sufficient, or will global P-O-P companies become the norm? One can even envision new kinds of partnerships, such as strategic buying groups of non-competitive consumer branding companies, working on a global scale, forward buying materials and components and allowing their other partners, the P-O-P companies, to manage these inventories. The next 10 years should be fun to watch.

Future Games: Strategies for Success

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