If you are considering new marketing strategies and are wondering about the cost of a point of purchase display, I have a formula that can help you decide if POP displays will fit your budget.
Point of purchase displays (also referred to as POP displays) are wonderful marketing tools that increase brand awareness, product credibility, and sales.
Point of purchase displays come in a variety of sizes and shapes to accommodate any product, as well as any floor space or counter space restrictions.
Temporary POP displays are generally made of corrugated board while more permanent displays are often made of plastic, metal and other more sturdy materials.
What is the Cost of a Point of Purchase Display?
Because custom POP displays can range from simple and utilitarian to complex and lavish, it can be difficult establishing a budget for such a project. Below is a formula I use to help clients decide on an appropriate budget and cost guideline.
The following is for a custom-designed, temporary POP display (made to be used less than a year) that is made from corrugated board. This type of display is considered the more affordable, introductory low-end option.
50% of retail value of your product x 8% = non recurring merchandiser display (excluding tooling, pack-out and transportation)
Example:
- ABC Gizmo to be sold in grocery and convenience stores
- 500-1000 stores.
- 48 count floor display.
- Product retail value is $8.99
[(48 x $8.99) x 0.5] x .08 = $17.26 for each display (excludes tooling, pack-out and shipping)
Therefore: $17.26 / 48 units = $0.36 extra cost per unit
If, after plugging in your own values into this equation, you find that your additional cost per unit is too high, it may not be the time to invest in a custom point of purchase display just yet.
Point of purchase displays are great for introducing new products in addition to establishing permanent shelf space. And they should, ideally, be tied in with other marketing efforts.
This has been a part of my tutorial series called How to Buy Packaging 101. So click the link below to head back if you haven’t finished reading it yet. 🙂
5 Responses
Sara, how are you… I am doing research into trends in global markets for Printed PoS display and signage in the retail environment. Your orientation about budgets is pretty good. Next time I will send you several inquiries, if you don´t mind helping me. Thanks.
Best regards,
Sara Ruiz
The best research is to attend industry events and talk with various people, as you’ll get nuggets of information from different perspectives. An event such as Global Shop happening in Las Vegas this year at the end of March. I’ll be there, if you would like to chat while there please message me via my contact form.
Thanks for the insightful pricing formula! I am wondering about industry norms regarding who pays for displays. My CPG company sells food items to grocery retailers. We have one potential retailer who wants a cardboard floor display for a few of our items. We have never used display shippers before. Can you comment on industry standards as to who is expected to pay for the displays? Do we pay part or all of the display? Or are costs sometimes passed through to the retailer? Thanks in advance
Hi Mike, you’ll need to resubmit your quote for your items to your retailers in order to include a display – ADD that additional cost into the unit cost. And keep in mind its just not the display, your weight will change as you add more corrugated materials which means your shipping costs will also change. There are two ways to do this, either you continue to ship your items as normal, with a flatten display that the store will have to set-up, OR you ship your product within the display itself so that the retailers don’t have to anything up. They may have requirements or preferences and it would be best to ask first. Always include everything into your unit costs – it covers you and they won’t have extra bills to pay.
Thanks for the reply. Say the displays cost about $40 a piece (3 tier, custom printed, corrugated floor display) that holds 36 units. That’s a fairly large upfront cost. Assuming the display will have a service life of 1 year, how would you add that cost into the wholesale cost?