Why Display Compliance Matters More Than Ever | Podcast with Conversations on Retail

Display compliance isn't just a best practice. It's often the difference between hitting your sales target and missing the year. Tune into this episode of "Conversations on Retail," where Storesight's Henry Ho (Chief Strategy Officer) and Marc Yount (Chief Operating Officer) dig deep into why CPG growth relies so heavily on temporary displays, and why an alarming 58% of planned promotions fail to execute as intended.

They introduce Storesight's "third revolution of retail data," explaining how their always-on platform combines a massive connected shopper crowd with advanced AI to deliver near real-time shelf visibility. They show how this intelligence helps brands close the critical execution gap and offer a first look at new, actionable KPIs like Share of Display that are changing the way senior leaders guide sales strategy and protect major promotional investments.

Video Transcript
Why Display Compliance Matters More Than Ever (Conversations on Retail Podcast Transcript)
Featuring: Henry Ho (Chief Strategy Officer, Storesight) and Marc Yount (President and COO, Storesight)

Introduction
Henry Ho: Welcome to the latest edition of Conversations on Retail, the Storesight podcast. I'm Henry Ho, and joining me is Marc Yount, President and COO of Storesight. We're excited to discuss how CPG brands can win at retail by sharpening their display execution.

Marc Yount: Sounds great. Thanks, Henry. For anyone who might be new or not know about us at Storesight, we like to say that we are lifting the black box off of the retail store to show our customers and the industry what's actually going on inside the store, at the shelf, at scale. It's a big venture. We call it the third revolution of retail data. We know there's a lot of great POS data out there. We know there's shipment data out there, but most people haven't solved for getting great data from what's actually going on at the store to understand their execution.

We do that at a large scale across multiple countries. In the U.S. alone, we regularly are checking over 50,000 retail locations. We do that through a crowd of connected shoppers that we call Field Agents who use our app to gather information, take pictures, and submit that data. Then we're able to layer our AI on top of that to extract even more data off those photos and roll it all up together for our customers.

The Criticality of Display Execution
Henry Ho: That's great, Marc. You know, you and I just came back from Chicago. We were at the Path to Purchase conference where a lot of marketers were there talking about their business. We actually gave a talk on the future of retail intelligence and we said the future is here. We certainly heard a lot of talk about the importance of displays. Give us a little bit of perspective on what you heard.

Marc Yount: More than I expected and actually timely. We knew we'd be recording this podcast, but we didn't know we'd be getting so much fodder from the industry. One of the common themes was about how displays are being executed, especially where we're at right now in a key season of retail. People hearing our talk about unveiling that black box went, "We know you can see planograms. We know you can check on pricing and out-of-stocks, but can you check on displays?" Of course, the answer is an easy yes.

The key question back is why? What we hear from customers and prospective customers is that it's so critical that every one of their displays is executed per plan. They built their guidance and their planning off of it, and it drives so much of their business. We'll talk about some stats in a minute that really back that up, but we certainly heard that display understanding and display execution is critical, maybe more than it has been in a long time.

Henry Ho: So today we're going to zero in on display compliance, one of the most impactful and challenging areas for in-store success. At retail, we always say, "It's always been about execution, execution, execution," and for the span of my career, it hasn't really changed. Today, there are new tools that help people get their arms around this. To put it in perspective, on average, 24% of CPG sales are driven by products featured on temporary promotional displays such as endcaps and freestanding racks. For seasonal brands, this can be much higher. If you miss your goals on display compliance in the early part of the year, your year is shot.

Marc Yount: As we record this today on November the 14th, it is the season. It's the season that people, especially in certain categories, make hay while the sun shines. The season is huge. We work with a lot of customers. One of them that relies on us a lot for displays during the season is a major tape and adhesives company. Those packages need to be taped. Guess where those customers get that tape? In-store, in the display area, when they walk by and realize, "I need some of that tape because I've got some wrapping coming." It has to be visible. If it's not there, the odds of them going into the department that houses it in-line are pretty low.

The Startling Execution Gap
Henry Ho: But here's the catch. Only 58% of planned secondary displays are executed as intended.

Marc Yount: That's the stat that stood out to me. You have to pause there for a second and go, "Are we just okay with 58% nowadays? Have we just gotten used to it?" I'm betting a lot of people listening to this that deal with execution issues are not surprised by that stat, which is kind of sad.

It's more nuanced than that, Henry; the channel matters.

Grocery stores see about 57% compliance, and from those displays, the brands see an average of about 19% sales lift.

Mass merchants in mass channels have only about 40% compliance. It's a bigger box, a lot more space to get wrong or right. More times than not, it's gotten wrong versus the plan. But it matters so much more in mass because of foot traffic. Just from those 40% compliance, brands see on average a 32% sales lift. Imagine if it was 80% compliance. It would make or break their year.

In smaller channels like dollar stores, there's 78% compliance with just a 9% sales lift. The channel matters.

Henry Ho: Those numbers are startling. 58% on average. I used to sell into a seasonal category, Lawn and Garden, and the one or two endcaps we could get during those critical three months usually made up about 20% of our total sales for that channel. That number lines up beautifully with the data that we have. Many brands allocate up to 20% of their gross annual revenues for promotional activities. And they're only getting 58% compliance!

Real-Time Solutions to Save the Day
Marc Yount: Let me tell you a recent story about a program we developed in the C-store channel. For a lot of companies, especially salty snack, confectionery, and beverage, C-stores matter. The story here is about a beverage company that we work very closely with. In their C-stores, certain cooler displays make or break their business, and they have almost zero visibility into execution of those displays.

We've partnered with them to develop an ongoing way to regularly and consistently view what's actually going on with their cooler displays at a major convenience store chain like 7-Eleven, which has over 12,000 locations. They are then able to use that information to go back and make decisions about how they can partner better with a retailer like 7-Eleven to ensure compliance, therefore meet their sales, make their bonus, and all the good things that come from that.

Henry Ho: C-stores are just one important channel. The club channel is another area where it's really important to get it right. People make major investments to get into club, and one of the largest retailers in that channel doesn't share any data. For most people, they operate blind. It's critically important to know what is going on with those fence displays and end aisle displays because so much of your annual volume is in those "dark spots" in the industry.

Marc Yount: So, how do we address it? Customers come to us and say, "I've got these displays that should be out," or "I've got a display calendar I want to put in front of you." We configure it, launch it out to the crowd, and in mostly days, we gather very fast, at-scale data, photos, and proof about whether it is or isn't going on. Our customers are able to ingest that data and go do something about it.

Henry Ho: That just triggered a thought from when I first started my career. Back in the day, if you could find out what happened to a display program, you would get data maybe three, four, five weeks after the event. That was the standard. Today, there are tools that can give you insights within days. The folks out there listening to this podcast, you have the ability now to start understanding what is going on with your execution from the moment it's supposed to be in-store on the floor.

Marc Yount: If you're someone who just heard that and said, "I still rely on four or five-week old data to understand display execution," you need to pause this podcast and go do something about it. The tools to be able to solve for quick, at-scale insights are here. If you're relying on old, stale data, you're missing the opportunity and you're just reporting historically.

Storesight—created by the merger of Field Agent and Shelfgram—is the company we have today. Shelfgram basically is the AI processing and visual layer on top of all the photos being taken out in the field. It provides this always-on view of what's going on across retail. One of the specific modules inside Storesight is the display module. It's a distinct way that the AI parses out things that are displays, end caps, side wings, four-ways—anything that might qualify as a display—and puts them in a separate bucket.

So, someone who really cares about display execution can look at what was happening that week, that day. I've been scrolling while we're talking, Henry. I went back into Halloween and I'm looking at a Kroger in Indiana and a big endcap of Tyson Spooky Chicken Nuggets. The tool allows someone to go in, and I literally saw one of those. I clicked on the text search, put in spooky chicken nuggets, and it pulled up a hundred other locations from that week where we had captured that same endcap.

Henry Ho: I can remember a time where a major customer had a major gift set promotion going on. It was the day before Thanksgiving holiday. I got the call and this customer said, "I'm in trouble. I need to know what the execution of my gift pack is like at this particular retailer." We got all the info and we pulled that audit off for him in the middle of the night. He was able to get timely enough data over a two-day period to save that execution. This is just another example of how real-time information can help you save off a disaster.

The Future: Share of Shelf and Share of Display
Henry Ho: As we think about the future of display compliance and this whole idea of always-on retail intelligence, tell the audience what we're working on.

Marc Yount: I think if we're really going to bring in a third revolution of retail intelligence, if we're really going to lift up that black box, what has to come are new metrics. When POS really rolled out in the '90s, it unleashed new metrics. We started talking about market basket data and share of sales. What are those metrics going to be when we lift up that black box at scale, the metrics that are actually going on at the shelf that help us drive our business?

Henry Ho: I know we're working on some really fun things around Share of Shelf. Tell us about that.

Marc Yount: That's a perfect one. We think that's the biggest one to start with: Share of Shelf. What we mean by that is more of a real dynamic Share of Shelf. If we're looking at all these stores all the time and aggregating those and putting them through AI to extract data, we can extract number of facings, number of facings by brand, size and space by brand, and how out-of-stock the shelf was.

All of a sudden, what used to be this time-honored tradition of comparing your share of sales with what the planogram was supposed to be, or comparing it to a few store walks that you did, is transformed. Now, you have millions of photos that have come in that week. Why can't we just let you sort, filter, and look at the regions, the stores, and the categories that you want, click a button, and get a real-time aggregated view of Share of Shelf? Picture going into a buyer meeting and saying, "Look, this is an objective data set. We have 20% share of sales from our Nielsen report, but we've only got 15% of the space. We need some more space." That's a common problem.

Henry Ho: Share of Shelf is one. Share of Display is another. I know we actually have some customers that we are also calculating and helping them figure out their Share of Display.

Marc Yount: I actually think that's going to be one of our biggest unlocks. I would be willing to bet most people listening to this, especially if you're a brand or supplier in the CPG world, do not have a good aggregate view of what brands are on display, what types of display are actually happening at the shelf. At scale and aggregate, to know how much of it was endcap, how much of it was sidekick, how much of it was a clip strip, and how much of that was your brand or not—with the photos to back it up at scale—we think that's really big. This is introducing a new metric called Share of Display.

It's one thing to do the examples we gave where somebody's got a pre-Thanksgiving problem. It's another thing to plan out this idea of understanding that I regularly expect these displays to be up in certain departments in certain retailers, and then have a trending dashboard over time that week over week, month over month, at scale. Am I compliant? I paid for this. I was told I was going to get it, and now I'm trending it over time. And so I have a great ongoing story with my retailer partner about what our display compliance looks like.

Henry Ho: Some of our most innovative customers that are partnering with us are driven from the top. The CEO is saying, "I know that this is one of the biggest investments I can make by fixing display compliance." On the other side, we're seeing senior sales leaders are saying, "If I understand what the Share of Shelf is, I can either reward or challenge my sales team to do better in these areas. I need to have an objective KPI and dashboard to understand these things." These metrics will change the way people work, the decisions they make, and grabbing that extra one or two points of share along the way.

Conclusion
Henry Ho: Mark, to wrap this thing up, the future of retail intelligence, it's here, it's now. If today's discussion has resonated with you in the audience and you'd like to learn more about our AI-powered platform and custom audit capabilities, please reach out to us via storesight.com.

Marc Yount: We'd love that. Thanks everybody for tuning in to the Storesight display compliance podcast. We hope to hear from you so that we can help optimize your display performance. See you next month for more strategies to help your brands win at retail. This is Storesight. Let's go.