Point-of-Purchase Advertising: A $24 Billion Printing Opportunity
Hanover, Ma. — The dramatic shift from in-home advertising toward out-of-home advertising is paving a huge path for Point-of-Purchase (POP), currently a $25 billion printing opportunity worldwide. Specifically, in-store advertising, the last line of influence for the
supplier, accounts for 53 to 60 percent of consumer purchases, according to the Point-of-Purchase Advertising Institute (POPAI).
Given the shorter time frame and greater versatility of ad campaigns today, digital printing has virtually become the only way manufacturers can meet retailers' ever-growing stringent demands. According to I.T. strategies, digital printing of POP advertising could grow from
$6.3 billion today to more than $9 billion by 2003. The holdback: POP industry participants are not familiar with or understand the benefits of digital printing.
Currently, in-home advertising commands the lion's share of advertising expenditures, but the overall trend is away from in-house advertising and shifting towards out-of-home advertising. The out-of-home market now accounts for nearly a fifth of all advertising spending.
The primary reason for the sharp increase in out-of-home advertising is the accuracy of targeting advertising. Thanks to electronic commerce and point-of-sale (POS) technologies, more information can be captured about customers and their buying patterns. In-store advertising is
becoming one of the fastest-growing advertising mediums.
Digitally produced POP signage eliminates the constant battle for shelf space by instituting a custom POP signage system that allows centralized disposition. It has the ability to control a corporate image at the retail level while eliminating visual annihilation of corporate
logos. But most compelling is that using a POP digital signage program increased a store's sales by 8% within a few months of implementation, according to research I.T. Strategies.
Digital printers have low fixed costs but higher variable costs which allows them to compete at low runs but not offer a significant price discount at larger runs. One of the major fixed costs of digital printers is their equipment which ranges from $7,000 - $400,000. Screen
and offset printers, traditional methods of printing POP, have high fixed costs because of the plates, screens and films that are needed. Typical traditional printing is not able to print runs under 50 because the cost is far too high. With short runs, digital printing (depending on
technology) can be price competitive and often the only viable solution.
For more information contact I.T. Strategies, Inc., 781-826-0200 fax 781-826-0151 or visit their website at www.it-strategies.com.
This article originally appeared in the Janaury 2001 issue of Recharger.