If you’re working in retail marketing, it’s very easy to get swept up in a sea of omnichannel beacons, experiential stores and the proliferation of the Internet of Things (IoT) in stores like Amazon Go.
While the future is exciting, retailers also need to focus on what they can do now with the tools they have.
Consumers spend up to $5,400 a year on impulse purchases alone. Imagine being able to capture a percentage of those sales. That’s where point of sale (POS) marketing comes in. It’s at the center of any retailer’s transactions and, when leveraged, can be high-value in-store promotional real estate to drive more sales pre-checkout.
In this article, you’ll learn:
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What is a point of sale?
A retail store’s point of sale is where transactions are completed. Traditionally, these were cash registers, but with mobile retail POS systems like Lightspeed, merchants can also process transactions anywhere in their store.
According to a 2016 study from www.CreditCards.com, 5 in 6 consumers admit to making an impulse purchase in-store, yet many retailers aren’t effectively using the space around their cash register to maximize impulse purchases. That’s where point of sale marketing comes in and point of purchase displays come in.
What is point of sale marketing?
Point of sale marketing (also known as point of purchase marketing) is when a retailer strategically places low-cost products near their point of sale with the hope that customers purchase additional items.
Unlike the items placed on your shelves, customers only take a couple of seconds to decide whether or not they want to buy products featured on a point of purchase display. If you sell low-investment products (like shoe cleaners, gift cards, gum or accessories) consider placing them near your point of sale.
Why point of sale marketing works
The majority of consumers make impulse purchases. The reason why point of purchase displays so well is because it’s inferential suggestive selling. If a customer is already making a purchase, they’re more likely to feel comfortable buying additional, less expensive products as well.
That’s why showcasing low price point items near your store’s checkout or point of sale is such an effective way of cross-selling.
The benefits of point of purchase displays
The primary benefit of point of sale displays is that they can contribute to higher overall sales by increasing the number of items a customer purchases.
Retailers can use POS displays to push promotions like BOGO, accessories, consumables and any other items that may not have been on a customer’s original shopping list.
The most impactful types of point of sale displays
There are several different types of POS displays, each with their own benefits and use cases. The ideas below can each be tailored to work in your store:
- Freestanding units
- Counter displays
- Dump bins
- Sampling areas
- Checkout displays
1. Freestanding units POP displays
Freestanding display units are a great option for showcasing products that you want to draw explicit attention to. In the example below, we can see Lululemon using freestanding displays to showcase their no-show yoga socks.
2. Counter point of purchase displays
Counter space is incredibly valuable real-estate in any retail store to showcase accessories, just be sure to keep a clear line of sight between the sales associate and the customer and to not clutter your counter.
An example of counter displays done well is Saturday NYC’s store in Sydney, Australia. The counter itself is kept tidy and their branded candles are clearly in a paying customer’s line of sight. As a bonus, Saturdays’ product display in front of the counter features impulse-worthy purchases like a branded reusable bag and coffee mug.
3. Dump bins POP displays
This type of display is most commonly used for small items like candy, drinks, toiletries or other products that consumers usually buy more than one of at a time.
Red Bull’s giant can is a notable example of a dump bin product display that we frequently come across everywhere from convenience stores to big-box home goods stores like Home Depot.
4. Sampling area POP displays
Sampling areas let customers try products before they buy, which can influence their decision. You will often see sampling areas at supermarkets or health and beauty product stores.
Cosmetics company LUSH has sampling areas throughout all of their stores and gives potential customers the opportunity to smell and try a product to see if it’s right for them.
As long as the featured product is aligned with its purpose, sampling stations are also great compliments to in-store events and workshops that you host.
5. The checkout POP display
Customers hate waiting in line, but if your shop doesn’t use a mobile point of sale system, lineups to pay are bound to happen. Why not make it a pleasant experience?
Take, for example, Sephora’s checkout experience. Given the number of customers they serve, lineups to pay are unavoidable, so they transformed the entire lineup into a point of sale display in all of their locations. Customers browse featured products while they wait to pay and can add them to their cart.
Point of sale marketing tricks for in-store sales
You want your point of sale displays to generate as many impulse purchases as possible. To do that, we suggest considering these four tips:
- Cross-sell related items
- Promote special offers
- Be strategic with positioning
- Leverage social proof
- Use online and mobile technology
- Choose impulse products wisely
- Hit the psychological triggers
- Train associates in suggestive selling
Cross-sell related items
Often, the best opportunity to promote an impulse item happens when the customer has already decided on what they want to buy. If the shopper intends to purchase a specific product, you can generate impulse transactions by recommending items that complement what’s already in their shopping cart.
This is where cross-merchandising comes in. Displaying relevant items together prompts impulse shoppers to make an additional purchase.
Take a look at this merchandise effort from Target, which displays baby sunblock together with swim diapers. The Target team knows that many people shopping for swimming diapers would also be on the lookout for sunblock, so Target put the two products together.
To find out which of your products are commonly purchased together, you can Lightspeed Analytics’ Commonly Bought Together report. In Analytics, head to Marketing and click Reports. Select the Commonly Bought Together report and adjust the Sale Completed Date to be within the timeframe you want.
The Commonly Bought Together report allows you to search and filter the combinations of products that were purchased. This will give you ideas about what you could bundle or cross-sell in the future.
But don’t exclusively listen to your point of sale’s data for cross-selling opportunities—listen to your customers! The most authentic way to find out what a customer’s needs are is to listen to them while you’re interacting with them. They’ll let you know what problems they’re trying to solve and you can find products that help them.
Promote special offers
Point of sale marketing is also a great way to promote specific products or highlight any ongoing campaign you have at your store. Your point of purchase is the perfect place to showcase products or signage with offers detailing specific discounts, BOGO deals, new merch or seasonal campaigns.
According to a survey on impulse purchases, approximately 85% of respondents said their impulse purchases had to do with a discount or promotion. Making sure you have signage and products relating to promotions at the point of purchase, will help make the sale once customers reach the cash.
Your staff are equally important to the equation. They need to be equipped with knowledge on active deals and promotions so they can let customers know about them once they’ve arrived at the cash. Make sure to train your staff on ongoing promotions, suggestive selling tactics and scripts to help them motivate customers to purchase.
Be strategic with positioning
Part of increasing visibility (and sales) with impulse purchases entails placing the merchandise where customers are sure to see it. In retail stores, the two most effective ways to pull this off would be positioning impulse products at the checkout area and placing them near your bestsellers.
- Placing products at the checkout zone is a common and highly effective tactic. Shoppers who are at the point-of-sale area are likely already in the mood to buy, so more liekly to make additional purchases. You have two options for placing items near your POS:
- Put them on or in front of your checkout counter.
- Place them along the aisle of your checkout queue.
- Position your products near your store’s prominent sellers. What parts of your store do customers frequently head to? What are the items that customers usually go for? Strategically place merchandise near these areas or products to increase their visibility.
Leverage social proof
Online retailers have long been using social proof to reel in impulse shoppers. Amazon, for example has the popular “People also bought” section on its product pages that showcase products that other customers have purchased.
The same tactic can be implemented in-store. Putting together displays of your most popular products — and labeling them accordingly — can grab the attention of impulse buyers and encourage them to consider purchases they wouldn’t have thought of otherwise.
Amazon, once again, does an excellent job here. Take a look at this photo from one of its brick and mortar locations, which has signage displaying social proof points like “Most Wished For” and “Highly Rated.”
Use online and mobile technology
A study on shopping behavior found that social media, mobile apps, and SMS marketing can drive unplanned visits or purchases.
Mobile Commerce Daily cited that “21 percent of respondents say they make more unplanned purchases because of shopping apps, 20 percent do the same because of retailer texts and 22 percent for retailer social media. These were the highest scoring tools in terms of encouraging shoppers to make more unplanned purchases.”
Be sure to leverage online and mobile tools to increase impulse store visits and purchases. If you’re on social media, make sure your fans are in the loop by posting news about any items or promotions.
Covet, a jewelry shop in San Francisco, does this really well. Covet keeps their Instagram account updated and they often post pictures encouraging people to stop by the store.
And if you have a mobile app, keep it updated so users can see the latest happenings in your store.
Do the same thing via e-mail and text. Grab the opportunity to bring people into your shop by alerting subscribers whenever you have something happening in your store. (Just don’t overdo it. Keep messages relevant and only alert people who have opted in to your list.)
Choose impulse products wisely
The best impulse products are the ones that are easy to grasp—both physically and mentally. Keep them simple. As business consultant Lynn Switanowski told ABC News, “Such products don’t need a lot of explaining. It sells itself (because) you understand what it does.”
Ideally, impulse products should be small and inexpensive. These are items that people can pick up and easily add to their baskets or hand to the cashier.
Going back to Victoria’s Secret example, the retailer chose to place trial size products near the checkout area precisely because these items meet the criteria above: they’re uncomplicated, handy, and economical.
Keep these principles in mind when you’re deciding on which impulse items to display.
Hit the right psychological triggers
Make your impulse buys more noticeable and enticing by pushing the right consumer buttons. Here are some suggestions:
- Urgency – Trigger people’s sense of urgency through limited-time promos. Consider the Bath & Body Works example above. It included a “Today Only” description in its signage to make the impulse buy more compelling.
- Value – Make people see that they’re getting a good deal with generous offers. Victoria’s Secret for instance runs “Buy two, get two” promos with its impulse products to further encourage shoppers to buy.
- Excitement or Novelty – You don’t always have to throw in an offer with your impulse products. Often, if a product looks fresh or novel enough, people will notice them. If you have new and original items in your store and they fit the above-mentioned criteria (i.e., handy and low cost), then consider testing them out as impulse buys to see how customers react.
Train your associates in the art of suggestive selling
While impulse buys typically come in the form of those small, handy items near the checkout counter, let’s not forget that you can also encourage impulse buys for moderately-priced or even higher-priced merchandise.
The key is training your associates to practice suggestive selling. When an associate develops a rapport with the shopper, they’ll be in a much better position to recommend unplanned purchases.
Here’s some things to consider,
- Suggestive selling only works if you (or the associate) are able to make a genuine connection with the customer.
- The product you’re recommending should truly benefit the customer and that they’re open to buying it.
- Only do it after you’ve gotten to know the customer. This will allow you to make more relevant recommendations.
- When a customer already have a product in their hands, suggesting something that is complementary to it could increase add-on sales.
Reese Evans, a former retail associate, also recommends using suggestive selling to address objections. “If someone is in your store and saying things like ‘I’m not sure about this…’ or ‘The fit is a little loose…’ retailers should grab the opportunity to suggestive sell.”
“The fact that they’re going through the process of eliminating things that they might not like means they’re seriously considering buying. If they weren’t, then the would’ve walked out of the store already.”
“So let’s say the shopper thinks a particular garment is too loose for her body type; that would be a great opportunity to suggest a belt to go with the product to help make an outfit complete.”
Make the most of your point of sale marketing
Your retail space’s square footage is limited. While you don’t want to clutter your space, you definitely want to use that real-estate to promote your products and drive more in-store sales.
And that’s where point of sale marketing comes in handy. With it, you create additional sales opportunities and increase sales without being an annoying salesperson.
By focusing on finding products that help customers solve their problems, you’re sure to win their loyalty and their lifetime value (LTV) in the process.