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Title: Produce merchandisers' preferences for point-of-purchase advertising materials
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Title: Produce merchandisers' preferences for point-of-purchase advertising materials
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Creator: Degner, Robert L.
Mathis, Kary
Publisher: Food and Resource Economics Dept., IFAS, University of Florida
Publication Date: 1977
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Table of Contents
    Front Cover
        Front cover
    Title Page
        Page i
    Center information
        Page ii
    Table of Contents
        Page iii
    List of Tables
        Page iv
    Main
        Page 1
        Page 2
        Page 3
        Page 4
        Page 5
        Page 6
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
Full Text
1Jo- 77
.77


i HUME 11BRARY
NOV 1 0 977


Staff Report 1









E PL M


(C


AGRICULTURAL MARKET RESEARCH CENTER
FOOD AND RESOURCE ECONOMICS DEPARTMENT
Institute of Food and Agricultural Sciences
University of Florida
Gainesville, Florida 32611






















PRODUCE MERCHANDISERS' PREFERENCES FOR
POINT-OF-PURCHASE ADVERTISING MATERIALS

by

Robert L. Degner and Kary Mathis


Staff Report 1


February 1977


Staff Papers are circulated without formal
review by the Food and Resource Economics
Department. Content is the sole responsi-
bility of the authors.







Food and Resource Economics Department
Institute of Food and Agricultural Sciences
University of Florida
Gainesville, Florida 32611













The Florida Agricultural Market Research Center
A Service of
the Food and Resource Economics Department
of the
Institute of Food and Agricultural Sciences





The purpose of this Center is to provide timely, applied
research on current and emerging marketing problems affecting
Florida's agricultural and marine industries. The Center seeks
to provide research and information to production, marketing,
and processing firms, groups and organizations concerned with
improving and expanding markets for Florida agricultural and
marine products.
The Center is staffed by a basic group of economists trained
in agriculture and marketing. In addition, cooperating personnel
from other IFAS units provide a wide range of expertise which can
be applied as determined by the requirements of individual pro-
jects.















TABLE OF CONTENTS


Page


List of Tables . .

Introduction . .

Research Procedure .

Research Findings . .

General Considerations

Quality .
Quantity . .
Size . .
Convenience. .

Price-Cards .

Recipes and Nutritional

Pictures . .

Large Materials. .

Summary . . .


I nformati on
. .

. .


References. .














LIST OF TABLES


Table Page

1 Market areas, number of firms, number of retail 2
stores, and combined market shares of firms
included in study

2 Sizes of point-of-purchase material preferred by 5
produce merchandisers in five major market areas

3 Types of point-of-purchase material preferred by 7
produce merchandisers in five major market areas,
1976












PRODUCE MERCHANDISERS' PREFERENCES FOR
POINT-OF-PURCHASE ADVERTISING MATERIALS

Robert L. Degner and Kary Mathis


Introduction


Fifteen years ago, U. S. agricultural groups spent an average of
10 percent of their annual budgets on point-of-purchase (POP) advertis-
ing [7]. Although current, precise figures on POP advertising by
agricultural commodity groups are not available, some Florida commodity
groups spend considerably more than 10 percent of their total budgets
for POP advertising. It is estimated that approximately $1 million
will be spent during 1977 for POP advertising material to promote Florida
agricultural products. Commodity organizations with modest budgets can-
not engage in effective television, radio, or newspaper promotion campaigns
because of prohibitive costs. POP advertising is one of the few remaining
promotional activities which many smaller organizations can afford to use.
A primary concern among POP advertisers is retailer acceptance of
their material. A major U. S. food retailer interviewed by Florida Agri-
cultural Market Research Center personnel estimated that only 25 percent
of the POP advertising material received by his firm was utilized. Others
also said much was wasted, which agrees.with previous research [5]. There
are very few recent published reports that deal specifically with the use
of POP for produce items. One study attempted to measure the overall
effect of POP on sales of fresh grapefruit, but did not evaluate factors
affecting the use of POP per se [10]. Other works have dealt with POP
use in grocery stores in a general way or else have focused on items other
than produce [2, 5, 6, 7].
The objective of this report is to indicate the types of POP advertis-
ing materials preferred for fresh produce items by produce merchandisers
of major food retail firms. Although adequate data were not obtained to
provide quantitative responses in most cases, the qualitative results can

ROBERT L. DEGNER is assistant professor and KARY MATHIS is associate
professor of food and resource economics, University of Florida.






-2-


be used by agricultural commodity groups to develop POP materials that
better fit the needs and preferences of major retailers, thereby increasing
the chances that the materials will be used.


Research Procedure


Produce merchandisers for major food retailers in Los Angeles,
Chicago, Philadelphia, Boston and Detroit were interviewed to analyze
marketing problems for the Florida celery and lime industries during the
period May through October, 1976. Although these two studies did not
focus directly on POP materials, merchandisers were asked about their use
and preferences for POP [4, 8].
Because produce merchandisers' preferences for point-of-purchase
materials for the two commodities were found to be quite similar and
because virtually all produce merchandisers expressed general preferences
for POP advertising material, it is very likely that generalizations for
fresh produce other than celery and limes are justified.
The produce executives interviewed represented a total of 38 food
retailers which controlled approximately 4,200 supermarkets in the five
market areas. The combined market shares of the firms interviewed in
the respective areas ranged from nearly 84 percent in Los Angeles to
53 percent in Boston (Table 1).


Table 1.--Market areas, number of firms, number of retail stores, and
combined market shares of firms included in study

Combined
Market area Firms Retail stores Combine
market share
-----------Number------------ Percent

Los Angeles 11 1,417 83.7
Chicago 8 1,377 83.0
Philadelphia 6 387 59.0
Boston 8 507 53.0
Detroit 5 513 71.0
Total 38 4,201










Research Findings

General Considerations


Point-of-purchase advertising is used for produce by all firms inter-
viewed. Nearly all firms readily accept POP material, review it, and
forward it to their retail stores if suitable. Only one large firm prefers
to print its own POP material in order to maintain a uniform store appear-
ance. .All merchandisers were asked to indicate their preferences for POP
materials, and major interest was expressed for three basic types of POP
materials: price-cards, recipes, and pictures of the product. Large
items such as window signs, banners, and over-the-wire hangers were also
mentioned, but were not very popular. Large materials appear to be less
important today than in the past [5]. Produce merchandisers voiced con-
cern over four problem areas with regard to POP advertising materials.
They were: (1) quality, (2) quantity, (3) size and (4) convenience of use.


Quality


A frequent request was for "high quality, tastefully designed"
materials. Although taste and quality are somewhat nebulous, merchandisers
indicated a preference for items printed on high quality materials with
attractive full-color pictures of the product. Attempts to economize on
the weight of printing materials or in use of color are usually "penny-
wise and pound foolish." Also, printed messages, if used, should be kept
brief. Merchandisers also requested that tie-in items be included if
possible to increase the versatility of the POP materials. This is consis-
tent with earlier findings [5].


Quantity


Several large firms complained of receiving too few materials to
satisfy the needs of all stores within a management unit. Several merchan-
disers said that if they did not receive enough kits to provide at least
one per store, none was used. When more than adequate quantities of
desirable materials are provided to merchandisers, the extras are sent









to large, high-volume stores where larger display areas may allow the
produce manager to utilize additional POP material.
Merchandisers particularly wanted larger quantities of price cards
and recipes. Price cards are used up quickly because of price changes,
and consumers "really pick the recipes," according to executives inter-
viewed.


Size


The size of POP advertising materials, particularly for price-cards
and pictures, is a key factor in determining whether or not the materials
are used. All produce managers were asked for their preferred dimensions
for POP materials. Most preferences were expressed as a maximum; almost
all indicated a desire for smaller materials than they currently receive.
Their most common complaint was that many items received were too large.
Although 15 different dimensions were specified as "preferred," there
was considerably more agreement than is apparent at first glance. There
was also a fair degree of flexibility; fourteen of those interviewed also
gave a second choice of dimensions. When first and second choices are
analyzed together, 16 percent of the choices were for POP materials 5 to
5 1/2 inches vertically by less than 14 inches horizontally (Table 2).
Eighteen of 49 choices, 37 percent, preferred a fairly standard 7" x 11"
format. Another large group, 31 percent of the choices, preferred the
relatively common 11" x 14" materials.
Sizes larger than 12" x 12" were not given as a first choice by any
of the produce managers interviewed, and only four gave such sizes as a
second choice (Table 2). The few merchandisers that expressed preferences
for the larger dimensions were affiliated with cooperative chains that
served a diverse group of retail outlets.
It is also essential to recognize the importance of the vertical
and horizontal dimensions. A card which measures 11" vertically by 14"
horizontally has a much better chance of being used by retailers than one
which measures 14" x 11". The primary reason is that many stores have
double-tiered produce racks and material that is too "tall" tends to
block shoppers' view when suspended above the product on either level.









Table 2.--Sizes of point-of-purchase material preferred by
disers in five major market areas


produce merchan-


Dimensions First Choice Second Choice Combined
Vertical X Horizontal Number Percent Number Percent Number Percent
-------Inches---------


5X9 1 3 0 0 1 2
5X7 1 3 0 0 1 2
5 X 7 2 6 0 0 2 4
51 X 8 0 0 1 7 1 2
51X X 11 0 0 1 7 1 2
5 X 11 1 3 0 0 1 2
5X14 0 0 1 7 1 2
7 X 11 17 49 1 7 18 37
9 X 12 1 3 0 0 1 2
11 X 14 11 31 4 29 15 31
12 X 12 1 3 0 0 1 2
14 X 11 0 0 2 14 2 4
22 X 28 0 0 1 7 1 2
24 X 36 0 0 1 7 1 2
>24 X >36 0 0 2 14 2 4
Totals 35 100a 14 100 49 100

aDoes not sum to 100 percent due to rounding.

Another basic consideration in determining POP material size is the
nature of the commodity, i.e., the usual importance of the item to the pro-
duce department. Bulky, high-turnover items will typically justify larger
shelf space and consequently larger POP material than items which are usually
allocated small display areas. It does not follow that providing large
POP materials will encourage large displays of the promoted item; this
strategy may occasionally pay off, but generally, if the material does not
fit the usual display space, it is discarded.


Convenience


Retailers have been faced with rapidly escalating labor costs. Thus,
they are concerned with keeping labor requirements at a minimum. Merchan-
disers expressed concern about installation and removal of POP materials.
They require materials that are quickly and easily installed and removed.
Several merchandisers said that they would not use "stick-on" (self-adhe-
sive) materials. Although such materials are easy to apply, they are





-6-


difficult to remove. Several firms prohibit the use of transparent tape
to install POP material as well. Removal of adhesive materials not only
requires valuable employer time, buy may also cause damage to display cases
and other surfaces where materials are placed. Further, haphazard removal
frequently results in a dirty, messy appearance. Thus, care must be taken
in selecting materials to ensure convenient installation and removal.
Additional details pertaining to POP advertising material quality,
quantity, size, and convenience of use appears under specific types of
materials. Discussion of price-cards, recipes, pictures, and large format
materials appears below.


Price-Cards


Price-cards were the most popular form of materials, mentioned by
nearly two-thirds of the merchandisers (Table 3). Most were quick to
specify detailed characteristics and to elaborate on problem areas. Many
firms complained of receiving too few price-cards. Related to this was
the common complaint that the usable life of price-cards is too short,
This criticism has been reported by others [l]. Retailers said that price-
cards are frequently good for a brief exposure period such as a special
price period which may last only three or four days, after which the
material is usually discarded. Many retailers will feature or special a
specific produce item numerous times during its season, but merchandisers
said that stores quickly use up their supplies of price-cards. Merchan-
disers suggested that the cards be made of a durable material such as
plastic so that prices could be easily wiped off and the cards reused.
Another suggestion was to provide slotted cards in which standard-sized
plastic price numerals could be inserted.
An alternative to the obviously expensive re-usable price-card would
be to provide larger quantities of a less expensive card, either initially
or at intervals during the season, provided the season is of sufficient
duration. Supplying a few at intervals would probably be more effective
since distribution would tend to remind produce merchandisers and buyers
of the product's availability and promotability. Obviously, the length
of the season and anticipated feature periods should be considered in
determining the number and distribution frequency of price-cards to furnish
retailers.








Table 3.--Types of point-of-purchase material preferred by produce merchan-
disers in five major market areas, 1976

Type of material preferred Number Percenta

Price cards 24 63
Recipes 18 47
Pictures, conventional and die-cut 16 43
Large items, i.e., over-wire hangers,
window signs 2 5
None 1 3
--b -b

aBased on responses from produce merchandisers of 38 firms.
bNot summed because of multiple responses.


Price cards are relatively convenient to install and remove. They
are generally placed near the produce items in relatively accessible
locations as opposed to over-the-wire hangers and banners which usually
require ladders and perhaps several workers to install and remove. The
cards are frequently held above tables and racks by means of clips attached
to horizontal wires, with tape, or in metal frames designed specifically
for price-cards or pictures. These frames are usually 7" X 11" in size,
which partially accounts for the large number of merchandisers preferring
this size material. Price-cards with self-adhesive backs would probably
not be well accepted.


Recipes and Nutritional Information


Eighteen of the 38 produce merchandisers mentioned recipes as an
effective POP advertising technique for produce (Table 3). Several large
firms have "consumer service centers" or "food information centers" where
nutrition literature and recipes are made available to shoppers. Most firms,
however, display recipes along with the product being promoted by the reci-
pes. Virtually all merchandisers said that recipes were very popular with
shoppers, but one felt that most of the recipes taken were wasted. One
merchandiser expressed concern over recipes because he felt that they
contributed to litter and clutter in the store. The negative statements
about recipes were considerably outweighed by the positive. Most of the









merchandisers felt that recipes enhanced sales, although no specific exam-
ples could be cited. A frequent complaint was that too few recipes were
usually provided. The standard 3" X 5" recipe card was the preferred
size, mentioned by several merchandisers. The preferred form for distri-
bution of recipes was a tear-off pad which is usually stuck onto a larger
piece of POP advertising material. This arrangement is satisfactory for
those firms that display the recipes along with the product, but the firms
with "consumer service centers" with bulletin boards or recipe racks need
recipes in other forms. Preferences were expressed for recipe leaflets
with holes in them for display on pegboard-type hooks or recipes which
could be displayed in small pockets.
Some major food retailers are augmenting recipe materials provided
by agricultural commodity organizations, food processors, and manufacturers
with in-house materials. A major reason is that nutritional aspects of
foods and consumer services are receiving increasing attention. Some firms
have home economists on their staffs whose primary responsibilities are to
develop combination public relations, consumer education, and product pro-
motion programs. As part of their activities, various items are periodi-
cally featured. In produce departments, items are featured for approxi-
mately two weeks to one month.
The "feature" consists of providing store-developed and printed POP
material which gives the consumer a "thumbnail sketch" of the product:
selection tips, basic nutritional data, serving suggestions, and other
bits of general interest information. The usual format is relatively
small, typically 3" X 5", the popular recipe card size. Some retailers
use lightweight paper stocks but one used a heavier cardstock which is
probably more convenient for shoppers.
In addition to distributing recipes in conventional printed form for
pad, pocket, or hanger distribution, some firms put recipes on the rolled,
tear-off polyethylene produce bags commonly used in produce departments.
The bags typically contain several recipes, and may be effective in pro-
moting some commodities. However, this distribution technique has several
shortcomings. The same recipes may appear for an extended period of time
until a given stock of bags is depleted. Repetition may enhance awareness
to some degree, but it may eventually dull the effectiveness of the recipe
distribution technique if the same recipes are used too long. Another









factor is that the bags are used for a wide range of produce items
unrelated to the recipes on the bags. The shopper may not read the recipe
in the store, and the immediate impulse effect which can stimulate sales
may be lost. However, this form of recipe distribution should be explored,
particularly where retailers have home economists on their staffs.
Another important aspect of recipe-related POP material is that of
printing recipes directly on consumer-sized packages. Where produce is
shipped in bulk, this is not feasible, but it may be worthwhile for those
commodities that are pre-packaged. It may also be possible to work with
major repackers to include recipe materials in or on packages.


Pictures


Pictures and die-cut materials showing produce items were mentioned
by 16 of the 38 merchandisers as effective point-of-purchase materials
(Table 3). "Die-cuts" are pictures with irregularly shaped cut-outs. These
materials are differentiated from price-cards in that they do not provide
a space for prices.
One advantage of pictures is somewhat longer shelf-life since they
do not include prices. Another is the flexibility which they give
retailers. Several pieces may be put together to form a large display
if desired. This is especially true of materials such as the orange
and grapefruit die-cuts distributed by the Florida Department of Citrus
in recent years and the celery stalks provided by the Florida Celery
Exchange.
Although pictures are popular with merchandisers, they expressed
concern over the size and the method of attaching them. The preferred
sizes were relatively small, similar to those for price-cards (Table 2).
Installation and removal problems were mentioned in conjunction with
picture materials too. Four merchandisers said that their firms would not
use "stick-on" (self-adhesive) materials which are sometimes used for die-
cuts because of the difficulty of removal.





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Large Materials


Large materials include over-the-wire hangers and window signs.
Most of these materials are at least 22" X 28", or 24" X 36" and larger.
Very little interest was shown in those for promotion of produce items
(Table 3). Only four merchandisers mentioned them, and only as a second
choice (Table 2). The firms that wanted large materials represented
voluntary cooperatives with considerable variation among stores. Large
materials may attract considerable attention, but they have several
disadvantages which may preclude their use. They are frequently diffi-
cult to install and remove, and they may detract from the overall decor
of newer, more fashionable stores. Further, when stores use large
materials such as window signs or wire-hangers, they prefer uniformity
which can usually be obtained only by preparing their own.


Summary


Most agricultural commodity organizations in Florida and many other
states as well use point-of-purchase advertising materials to promote their
products. Considerable expense is incurred in developing, printing, and
distribution of these materials.. A major concern is that retailers may
not utilize them even though they are provided at no cost. The objective
here is to report retailers' preferences for POP materials so that materials
can be designed which will result in greater usage.
The produce merchandisers of 38 major food retailing firms in Los
Angeles, Chicago, Philadelphia, Boston, and Detroit expressed interest in
four basic forms of POP material. Approximately two-thirds mentioned
price-cards as a preferred type of POP, nearly half mentioned recipes, and
16 of the 38 requested pictures of the products. Large materials, i.e.,
those with dimensions larger than 11" X 14" evoked some interest but are
not popular with produce merchandisers for promoting individual commodities.
Merchandisers had four concerns in regard to all forms of POP
materials. They were (1) quality, (2) quantity, (3) size and (4) con-
venience of use. Large retailers are extremely conscious of the image that
their stores project to customers. POP materials that appear cheap or





-11-


shoddy may be viewed as detrimental to a favorable image, and therefore,
not used. POP advertising should be printed on high grade stock in color.
Merchandisers complained about the quantities of materials received,
particularly price-cards. Suggestions included (1) provide more price-
cards, (2) make them re-usable. Since prices may change quickly, the
usefulness of price-cards is frequently short-lived. When materials are
provided to retailers, it is essential to provide adequate numbers of
kits for all stores. Some firms will not distribute any materials unless
sufficient quantities are received to insure at least one per store.
Size is a critical factor in determining whether or not POP material
is used. Virtually all preferred materials smaller than 11" X 14". The
typical supermarket may stock from 150 to well over 200 different produce
items, so space is at a premium. The size of the material should also
be related to the typical display space allocated to the item being pro-
moted under normal retail conditions and feature situations.
The cost of store labor makes convenience of use imperative. Mate-
rials must be easy to install and remove, or they will probably not be used.
Alternative means of attaching display materials to cases should be explored;
if adhesives are used, they should be investigated thoroughly to make cer-
tain that they can be removed without leaving a residue.
In conclusion, POP advertising materials offer agricultural commodity
groups a relatively low-cost means of promoting their products. POP materials
offer direct contact with consumers when all the necessary elements are pre-
sent to consummate a sale and they also provide visibility with produce
buyers and merchandisers during distribution of the materials. However,
consideration should be given to several points before proceeding with a
POP advertising campaign. Materials should be pretested with produce mer-
chandisers to get their reaction since they are the first major hurdle in
getting POP used. Also, the materials should be copy tested to determine
what message is perceived by shoppers. Finally, there is a prevailing
optimistic feeling among food retailers, agricultural commodity groups, and
industry consultants that POP materials are effective in increasing product
movement [3]. However, as indicated at the outset, few rigorous studies
have been conducted which objectively evaluate them. Some studies have





-12-



shown substantial sales increases for some products, and very little, if
any, benefit for others [2, 6, 10]. If sizeable expenses are incurred
in a POP advertising program for produce items, formal market research
should be considered to evaluate the effects of the material on sales.






-13-


REFERENCES


[1] Advertising Age. "Supermarket Panel Cites P.O.P. Rise," August 30,
1976.

[2] Bader, Samuel. "The Sign: Its Power Ever Rises," New Products
Marketing, Printers Ink, Duell, Sloan, and Pearce, 1964.

[3] Creative Management Institute. "How Signs Encourage Impulse Pur-
chases," Produce Merchandising, Hazelwood, Mo., 1976.

(4] Degner, Robert L. and Kary Mathis. Marketing Florida Limes: A
Wholesale and Retail Analysis, Florida Agricultural Market
Research Center, Industry Report 76-3, October 1976.

[5] Frye, Robert E. Point-of-Purchase Advertising and Factors Influ-
encing Use in Supermarkets, Marketing Research Report No. 692,
USDA-ERS-MED, January 1965.

[6] Gruebele, J. W., "Effects of In-Store Promotion Techniques on
Sales of Selected Products," Illinois Agricultural Economics,
Vol. 11, No. 2, July 1971.

[7] Henderson, Peter L, and Ralph Parlett. Agricultural Commodity
Promotions: Features Encouraging Participation of Retailers
and Wholesalers, Marketing Research Report, No. 911, USDA-ERS,
October 1970.

[8] Mathis, Kary and Robert L. Degner. Marketing Florida Celery: A
Wholesale and Retail Analysis, Florida Agricultural Market Research
Center,, Industry Report 76-2, August 1976.

[9] O'Neill, Bill. "P-O-P Goes the Product!" The Packer's Focus 76-77
Vol. LXXXIII, No. 54, December 1976.

[10] Sporleder, Thomas L. The Effect of Point-of-Purchase Display Material
on Sales of Fresh Texas Grapefruit. Texas Agricultural Market
Research Center Information Report MRC 69-4, Texas Agricultural
Experiment Station, College Station, Texas, November 1969.




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