In-store TV Networks Could Make a Big Difference
An Economist article about in-store TV networks maintains that they have worked well only for some retailers in some countries, despite the fact that they can improve sales (by 2% on average according to RSR), provide additional advertising venues for retailers, keep shoppers informed and entertained, and become a lucrative source of advertising revenue.
Examples provided include Wal-Mart which has the world's largest in-store TV network (built in conjunction with PRN) - over 3000 of their stores have screens that constantly show six channels (food, electronics, health, etc.) and more than 140 firms pay to advertise on them.
Wal-Mart's lessons from the past decade include the following:
- A 30-second spot created for TV
is too long, except for people stuck in check-out lines.
- Spots of five
to 15 seconds, with one or two messages, work best.
- Ads need to be mixed with
entertainment, weather reports and cooking tips.
- On average, customers
watch one minute of programming per visit.
- The volume needs to be turned down when shops are less busy.
Another example is the UK's Tesco which launched a similar system in 2004, only to realize that they couldn't find advertisers. It has since relaunched the network in only 100 of their stores with closer tie-ins between the ads and other in-store promotions. This format "is said to have lifted sales of some products by as much as 25%."
In terms of business models - it could be an outside company that manages the whole project (screens, advertising, etc.) and gives the retailers a cut, or it could be that the retailer pays for the screens and keeps the revenue while another firm runs the network. In either case, the networks make most sense for the bigger retailers.
Bottom-line: Since studies suggest that
"three-quarters of all decisions to buy something are made inside shops, in-store TV advertising could, in theory, make a big difference."
Posted by Universal Ad
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