How To Acquire New Customers & increase profit with an on-premise sign
As a business owner I am sure you are always looking for new ways to increase your customer base. Many businessowners have been in business for years and have never purchased a sign. Signs are so beneficial. It is important for everybusiness to have one.
With this article I want to share with you a study that was done that shows just how valuable a sign is to the bottom lineof every business.
In 1995 the University of San Diego did a study on the performance of on-premise signs. This study was done in two parts.The first part of the study involved analyzing a group of variables such as signage, location, population’s demographics, hoursof operation, etc.. at 162 southern California major fast food chains. Each variable was tested at each of the 162 locations tohelp predict the impact on-premise signs have on:
1. annual sales revenues 2. annual number of transactions 3. the average dollar amount spent per transaction.
The study showed that the number of signs at a particular location directly affected both annual sales revenue and the number ofannual customer transactions. Here are the exact findings of the study:
1. On average, one additional on-premise sign resulted in an increase in annual sales revenues of 4.75%. This translates to a $23,750increase in average sales revenues for a typical store in the study group with annual sales of $500,000. 2. On average, one additional on-premise sign increased the annual number of transactions by 3.93%. This translates into more than3,900 additional transactions for a store with an annual average of 100,000 transactions. 3. On average, one additional 36-square-foot wall sign added $0.06 per transaction, while one additional 144-square-foot pole signadded $0.78 per transaction.
Now for part two of the study. In part two of the study seven years of weekly sales data for Pier 1 Imports was analyzed. The data wasanalyzed so they could measure the effects of modifications, additions, or removal of on-premise signs on sales performance. As a resultresearchers found, and I quote, "on-premise signage has a statistically significant and financially substantive impact on the revenues of a site[and]... is a significant constituent of the factors causing the success of a retail endeavor." Here is a very brief summary of what the study found:
1. The addition of new signage to previously unsigned buildings, and the replacement of existing signage (generally, with larger signs) resulted in anaverage revenue increase of 5%. 2. The addition of a pole sign, or a plaza identity sign including the store's name, resulted in an average increase in weekly sales of 5-10%. The increasewas attributed by the researchers to the new signs' enhancement of site visibility to passing traffic. 3. The addition of small directional signs indicating entrance and exit routes resulted in weekly sales increases ranging from 4-12%. The increases wereattributed to the signs' ability to guide a site-bound shopper more than any specific advertising effect.
As you can see an on-premise sign can have a very positive affect on profitability. If used properly an on-premise sign will pay for itself many times over.