|
Page 1 of 2
By Ellen Pearlman
Strategic Thinkers: Matthew Egol and Christopher Vollmer
Credentials: Egol is a partner in Booz & Company's global consumer and media practice in New York; Vollmer is a partner at Booz & Company in New York where he leads the North American media and entertainment practice. He is also the author of Always On: Advertising, Marketing, and Media in an Era of Consumer Control published by McGraw-Hill, March 2008.
Big Idea: The last bastion of prime-time mass marketing may be the retail store
Article: "Major Media in the Shopping Aisle" by Matthew Egol and Christopher Vollmer, published by Strategy + Business, Winter 2008.
Place-based media is the latest marketing trend that seeks to reach consumers in various locations beyond their home—such as retail stores, gyms, trains, gas pumps—using digital and video technology. It's not a surprise that the shopping aisle is seen as a marketers' nirvana. After all, this is where consumers can now be reached with targeted video messages tied to a specific product at just the moment when the customer is in the aisle looking at her purchase options.
Many of the in-store advertising models are still in their infancy as marketers, media companies, agencies and technology companies work to figure out the challenges and the right mix of creative messages. But Matthew Egol and Christopher Vollmer, Booz & Company partners writing about in-store media for strategy + business, believe that this sector is poised for rapid growth. In-store media is a $500 million annual business now, but it could equal or exceed the growth rate of its online counterpart, say the authors. "It took cable television 25 years to reach ad sales of $20 billion," they say. "It took Web-based advertising about half as long…to reach the same milestone. Could in-store media reach it even faster?"
The technology to make this possible is Internet protocol television (IPTV) used by the in-store ad networks. The signal is downloaded through high-speed Internet connections, making it possible for thousands of different videos to be available at any screen or kiosk in a store. Premier Retail Networks (PRN) is expanding its use of IPTV after its tests in 2007 showed that sales were at least 10 percent higher in stores using this technology rather than less targeted methods. PRN's in-store network reaches 650,000 shoppers a month and was acquired by Thomson in 2005.
It's no surprise that Wal-Mart is in the forefront of testing the value of IPTV. In September 2008, the retailer announced its Wal-Mart Smart Network in 2,700 stores in partnership with PRN. The retailer spent two years and $10 million identifying the optimal locations, applications and programming for reaching consumers who shop at their stores. The smart network will allow relevant content to be customized for shoppers by store, by screen, by time of day.
Stephen Quinn, chief marketing officer, Wal-Mart Stores, U.S. said, "The Smart Network is intelligent too, because every screen and every message has a purpose and we will be analyzing point of sale data on an ongoing basis to deliver a shopper-centric communications platform. In short, the Wal-Mart Smart Network is a win-win: improving the shopping experience for our customers and driving results for our supplier partners."
Next, Bringing Advertising to the Shopping Cart
|
