There are certain sayings that continue to ring true, even as retail evolves at such a fast pace. "Signage sells" is one of those tried and true statements about retail. If you can get a sign on your item, it is much more likely to be picked up and make it into the shopping cart. The challenges for you are:

1. To understand the different opportunities available.
2. To know which signage is most cost effective.
3. How to ensure you get the signs you deserve.

Advertised items

The most obvious signs are to reinforce the advertised items, to the consumer when they are in store. Retailers and suppliers have made investments in the ad so they need to move volume when the shopper is in store.  These signs are usually tied to the creative in the ad and must be on all items, whether they are in line on shelf or in an off-shelf display.  In produce this is the most common form of incremental signage.
    

The positives about this type of signage are that regardless of whether you are on the front page or inside you get the same sign and most retailers have a solid process at store level to ensure signs are done correctly. It is a huge job each week to ensure all items come on and off ad at the right time and that all signage changes.

In-store specials

Most retailers will have an “in-store program” where they reduce the retail for a specific period of time to incent consumers to buy and also help their price image. Some retailers use this type of program to keep their pricing close to the price leader in the market.  It allows them to have a higher regular retail to go back to after the “in-store” is over.  These can take different formats such as “locked in”, “roll back” or “buy three and save X.XX”.  To date, retailers put more emphasis in the grocery department for these types of discounts but it could be coming soon to produce.
    

In-store specials provide an opportunity for guaranteed signage with less investment on the part of the supplier.  Depending on specific items and categories, a modest investment can provide exposure for four weeks. Unfortunately these signs can get knocked down over the duration of the temporary pricing reduction (TPR).  The consumer doesn’t usually complain because they get the product for less cost.

Themes

Incremental sales are a great thing for a retailer. Theme promotions are great opportunities to generate these important dollars. If your item fits into any themes it is worth exploring this avenue. Often the investment required is not as big as ads, they will build off shelf displays and signage can be unique to attract the shopper in store. Timing is important for themes, as they do not always fit into regular promotion periods.  You need to be prepared in advance of the regular cycles. You also need to be proactive because your space in a theme might not always be top of mind for the category manager.
    

Themes do get more attention than in-stores because they usually generate the incremental sales I mentioned.  Execution is all over the place so you need to follow up with your customers to see what is happening. Some stores are great, get creative and really execute. Others can’t find the stock in their back room.  If you are going to participate in theme promotions make sure you have the commitment to visit stores during these events.

Local

Consumers continue to push retailers for more local produce items. They don’t always buy them but they do say they want them. These are great opportunities for signage, especially for smaller regional producers that will not be in the ad often, if ever.  The retailer will put a sign on these products at regular price, which is not the norm. Anytime you can get a sign on your product without investing in price is something you should consider.
    

Execution of these programs varies from store to store. Similar to themes, you have to be in the stores to see what is happening.  

Which signage is most cost effective?

Every opportunity for signage will deliver a different level of volume for the investment you make. You should always calculate the return you get for the level of discount. This is the only way you will learn what is best and also where you can negotiate.
  

(Cents per unit profit (at the landed cost) X units sold)-over and above spend can be used to compare to regular movement.  Every time you make an investment in price you should use this to determine how effective it was. 
 

There will be some intangibles that are difficult to measure such as brand exposure and keeping your competition at regular price. Sales are influenced by many factors so try to assess any of these as well.
    

Once you begin to build history you will see where the best return is for your products.  Sometimes you just have to do it due to pressure from the retailer. If that is the case and you have the facts about prior history you are in a better position to negotiate.

How to ensure you get the signs you deserve

The biggest commitment you have to make is to be in the stores. This is where you can check execution and assess the performance.  Remember when you are in the store to look at the regular shelf position and for any off-shelf displays.  The off-shelf displays are the biggest challenge for retailers to execute and maintain. “Signage sells” is true, as is “if there is no price, they will not buy it.” If a sign gets missed or knocked down on an off-shelf display, consumers are much less likely to buy your item.
  

Follow up at store level and the office on signage. The most effective conversation happens at the store but to negotiate you need to have the facts for the office.  Remember to follow up about the good and the bad.  Telling a person in a store that a display looks great can be very rewarding for them.

Remember, signage sells!

Your business must be focused on driving sales and signage is an important tool. Understand the different opportunities with your customers, figure out what works best and follow up to ensure you get the results you paid for.
    

If you have some ideas to make signage more effective please give me a call at (902) 489-2900 or send me an email at pchapman@gpsbusiness.ca.