Why Brands Need to Have Visual Equity

Which Korean noodle would you choose and why? (source of image)

What is the most important marketing strategy for FMCG products?

Is it developing a strong brand? Advertising on TV, radio and newspapers? Embracing social media and citizen marketing? Or all of the above?

Well, these strategies are important. However, the trick to generating more sales is as simple as getting the right shelf spaces in retail outlets.

According to research studies done by INSEAD Marketing Professor Pierre Chandon, visibility on the shelves is critical to marketing success for most brands. The only exceptions would be the leader brands.

In this article, Chandon shares that visual equity - the act of being visible in stores - can exert a strong influence on sales. Quoting from him:

“If you’re located at the top of the shelf, it increases the percentage of people who see you by about 20 per cent, but it also increases (the likelihood of) your brand being chosen by the same amount."


"...if you’re in the middle of a shelf placement and if you can increase the number of facings, the chances you’ll be seen and bought are increased.”

For low market share brands (ie the newcomers with low brand strengths), the differences can be even more significant. According to Chandon, the right shelf placings can increase the probability of being chosen by up to 67%.

Being visible don't just apply to supermarkets and department stores. The same rules also work on the web with online stores. This is why being the first few names on a Google search matters.

How does this impact marketers?

Well, one should pay more attention to prime placement - on store shelves or online - rather than spend prodigious sums on fancy advertising, huge events, clever viral campaigns, or big-time Facebook splashes. Chandon suggests that marketing managers should "re-allocate their budgets to pay more attention to point of purchase and think more about brand presence instead of just brand preference."

In essence, the point of purchase is no longer just a distribution channel but a communication channel. Visual merchandising and in-store displays are thus more important than ever before.

As consumers become immune to the over-the-top efforts of numerous brands trying to drill themselves into their heads, their purchase choices appear to be influenced more by visibility than brand values. Instead of focusing on brand awareness, preference, and top-of-mind-recall, companies may want to look at where the real action takes place and grab a piece of it.

Unless, of course, you're Apple, Coke or Mercedes.

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