What Is POSM? Retail Marketing Explained

POSM is an acronym heard in boardrooms around the globe. Without POSM, your retail marketing strategy is incomplete. But what exactly does POSM mean? 

POSM refers to visual communications delivered at the ‘point of sale’ (i.e. shop floor), which encourages customers to buy, buy, and buy some more. According to ADvendio, over half (54%) of UK shoppers are most likely to impulse buy in-store, compared to 41% who tend to make unplanned purchases when shopping online. 

To maximise sales, you need to boost your in-store POSM plan. Digital signage software has emerged as the most modern, effective form of POSM, forcing retailers to move away from more traditional POSM marketing strategies, such as print. But before we dive into the benefits of digital signs, let’s learn more about the meaning of POSM. 

What Is the Meaning of POSM? 

POSM stands for ‘Point of Sale Marketing’ (or ‘Point of Sale Material’). It’s a method of retail advertising, that communicates additional offers, discounts and products to customers at the point of purchase. 

If you have ever bought a product in person, chances are that you have experienced POSM marketing. Think about a till at your local shop; can you see banners, posters, and graphics that advertise other products? These are classic examples of ‘Point of Sale Materials’. 

The meaning of POSM also extends to online retail. When you purchase an item online, you may notice pop-up offers, banners and limited-time discount codes. Again, this is a POSM tactic to drive sales and increase the value of your checkout basket. 

Why Is POSM Important? 

POSM is important because it allows retailers to influence their customers. 

POSM sits somewhere between subliminal marketing and no marketing at all. It is a transparent invitation for customers to learn more about your products. Research reveals that 87% of UK consumers believe that brands should be transparent to gain trust. 

Despite the straightforward nature of POSM, it is responsible for hundreds of thousands of impulse purchases a year. Brands that invest in this marketing strategy can maintain a persona of transparency while enjoying all the benefits of a big boost in sales. 

Examples of POSM 

POSM is any in-store or online display that encourages customers to purchase other items. 

• Digital signage.  This type of POSM can take many forms, including digital shelf edge labels, freestanding kiosks and wall-mounted TV screens. 
• Leaflet holders. Bright, vibrant leaflet holders can attract customers and inform them about limited-time offers. 
• QR codes. By strategically placing QR codes next to the queue, you can encourage customers to learn more about your other products. This type of POSM helps to transition your brand from the physical world to the digital realm, which is great for brand engagement. 
• Bargain bins. Everyone loves a discount, so why not use bargain bins? Granted, this POSM tactic is not appropriate for every retail business, but it works well for products that are typically resold (i.e. bookshops). 
• Posters/banners. Posters and banners are great for communicating ideas quickly and succinctly, especially if they cover a large surface area. 
• Pop-up ads. Pop-up ads are an online form of POSM that seeks to capture customers’ attention when they least expect it. 

Benefits of POSM

Brand visibility. Branded POSM displays are a great way to reinforce your brand’s identity throughout your shop. 

Communication with customers. Customers learn about the latest deals and discounts, and you show how much you care about customer engagement. 

Boost sales. Research shows that POSM marketing has a positive influence on sales. 

Leverage digitisation. When you invest in digital screens and other digital methods of communication, you are staying up-to-date with the latest trends. 

Transitioning to New POSM Methods 

Although all Point of Sale Materials are effective to some extent, recent years have seen a shift in the retail marketing landscape. Similar to many industries in the UK, the retail industry is undergoing drastic digitisation. 

According to Statistica, traditional out-of-home (OOH) media accounted for $22.37 billion (63%) of global outdoor advertising revenue in 2023. Comparatively, revenue from digital out-of-home (DOOH) advertising accounts for $13.26 billion (37%). 

Despite the difference, research suggests that the gap is narrowing. The same source predicted that worldwide DOOH revenue is expected to surpass $20 billion by 2028 alone. 

Increasingly, retailers are anticipating this change and transitioning from traditional to digital forms of POSM. Remember, digital doesn’t just mean online. The advent of digital signage solutions means that business owners can bring the online world into their shops. 

So, what is digital signage? 

What Is Digital Signage?

Digital signage is an umbrella term that encompasses any digital installation that shows content, including TV screens, freestanding kiosks and tablets. These digital screens are designed to communicate information quickly and effectively. 

What Is Digital Signage Important for POSM? 

In a 2012 study, researchers analysed the role of digital signs as an atmospheric tool in retail environments. They concluded that digital signs have a positive effect on shopper behaviours, such as spending. One study reported a 6.1% increase in footfall after installing digital signs, whereas another study reported a massive 17% increase in sales directly after digital displays were installed. 

Another study found that digital signage positively influences customer satisfaction. In summary, the study found that the presence of digital signs is a “promising tool for waiting perception management in retail waiting areas because of their capability to positively influence shoppers’ emotional experiences.” Of course, the happier a customer is, the more likely they are to engage with your business. 

POSM Example: Supermarket Digital Signage 

A good example of digital signs becoming more prominent in the world of POSM is supermarket digital signage. 

• Freestanding kiosks. Lots of supermarkets use freestanding kiosks to improve digital wayfinding. 
• Shelf-edge signs. Digital shelf-edge signs can display the latest deals. These types of signs also reduce labour, meaning employees can focus on helping customers and replenishing stock. 
• Menu boards. Menu boards can be loaded with easily digestible information about the latest products and offers. 

Digital signage hardware is easy to use, cohesive and instant. Upload content and watch it pop up on all the screens across your shop. 

What Are POP and POS? 

Now that you understand the meaning of POSM, you need to learn about POP and POS.

POP (Point Of Purchase) 

POP stands for Point of Purchase, also known as the transaction location. As you might expect, this term refers to the location where the customer decides whether or not they want to purchase an item. It’s important to remember that POP is from the customer’s perspective. 

When we talk about POP marketing, we’re referring to the entire retail space. This includes the location itself, the banners and digital displays. 

POP marketing encourages customers to consider other products and increase their overall spend. 

Examples of POP

• Supermarkets
• Corner Shops
• Clothes Shops
• E-commerce Sites 
• Brick-and-mortar Shops

POS (Point Of Sale) 

POS stands for Point Of Sale, which refers to where the transaction occurs. Retailers are constantly trying to improve their POS processes. This can come in lots of forms, including hiring more staff to reduce wait times and installing a newer, faster transaction system to streamline the buying process. 

POS is just as valuable as POP. According to one report, POS terminals (barcode scanners, credit card readers, and receipt printers) alone were valued at $41.9 billion in 2021. The market is projected to be worth $255.5 billion by 2030. 

Examples of POS

• Handheld Scanners
• Online Shopping Baskets
• Tills

Digital Signs: An Emerging POSM Tool 

Digital Signage is here to replace more traditional forms of POSM. Instead of wasting money on endless reams of paper, you can install a single screen and reap the benefits for years to come.  

Modern consumers expect an engaging experience, and digital signs offer just that. You can upload information about different promotions, products and discounts at any time, any day.