advertising regulation, on-premise business signage has increasingly come under ... findings of a study of small businesses conducted by. Signtronix that found ...
Misplaced marketing
How excessive restrictions on signage backfire Charles R. Taylor College of Commerce and Finance, Villanova University, Villanova, Pennsylvania, USA and American Academy of Advertising Abstract Purpose – The aim of this paper is to explore the impact of efforts by some municipalities to place various restrictions on on-premise signs and to examine the impact of strict regulations on local communities. Design/methodology/approach – Provides examples of restrictive sign codes and reviews articles providing empirical evidence on public perceptions of signs as well as the impact of signs on businesses and communities. Findings – Excessive regulation of signs is counterproductive; contrary to the beliefs of proponents of harsh restrictions, signs are helpful to consumers and business, and they contribute to a community’s economic vitality. Practical implications – In developing and implementing sign codes, municipalities should consider what research tells us about the value of onpremise signs. Members of the general public who have an interest in municipal affairs should consider research findings when forming opinions about the regulation of signs as opposed to relying on a limited number of individuals who may ignore the marketing functions of signs in developing and implementing sign codes. Originality/value – Demonstrates the importance of signage to consumers, businesses, and local communities. Keywords Advertising, Retailing, Regulation, Local government Paper type Viewpoint
ordinances is aimed at limiting heights to less than 10 feet, regardless of the location of the business, and associated traffic patterns. Other restrictions seek to dictate color, materials, illumination sources, and acceptable “types” or architecture of signs. A proposed ordinance in a Mississippi town exemplifies the problem. The proposal states that signs shall be constructed with traditional materials such as finished wood, glass, copper or bronze; cannot be internally illuminated; and cannot display bright yellow, orange or red on white. This framework, and others like it, ignores what credible research tells us about the role of signs. Readable and conspicuous signs play an integral role in marketing in our society and are helpful to both businesses and consumers. Signs serve multiple marketing functions. These roles include communicating the location of the business, reinforcing the advertisements as part of integrated marketing communications, branding the site, and enhancing store/brand image (Taylor et al., 2005). Perhaps the most obvious function of the on-premise sign is to communicate the location of a business to consumers. High visibility of the sign is essential in communicating that a store exists at a given location (Berman and Evans, 1998). The importance of the identification function is illustrated by the findings of a study of small businesses conducted by Signtronix that found signs to be the number one source via which consumers learned about the business, accounting for 50 percent of first visits. Lack of access to an easily detectable and readable on-premise sign can lead to lost sales. This effect is pronounced for small retail businesses, as they often do not have any alternative to communicate their location. Research on billboards affirms the impact that signage can have on bottom line sales for many businesses. In a national survey, Taylor and Franke (2003) found that billboard users reported
It is not uncommon for local municipalities to place significant restrictions on the size, height, illumination, and even the content of on-premise business signs, often at the behest of local planners and special interest groups. Arguments for restrictive codes include improving the commercial environment through aesthetic enhancement, which, in theory, is supposed to increase tourism. Unfortunately, the theory does not fit the fact and misunderstanding of marketing leads to mistaken regulations. A report on Scenic America’s (2003) web site captures the view of many who would like to restrict signs: The visual character of a community – the appearance of its streets, neighborhoods and business areas – is essential to its long-term economic viability and helps determine how residents and visitors alike perceive it. Sign control is an integral part of improving visual character and quality of life. Nothing destroys the distinctive visual character of our communities faster than uncontrolled billboards and signs.
In response to the anti-sign agendas of Scenic America and other “visual environment” watchdog organizations, many communities have enacted highly restrictive sign ordinances. While there is a history of controversy over outdoor advertising regulation, on-premise business signage has increasingly come under attack. The thrust of many of these The Emerald Research Register for this journal is available at www.emeraldinsight.com/researchregister The current issue and full text archive of this journal is available at www.emeraldinsight.com/0736-3761.htm
Journal of Consumer Marketing 22/6 (2005) 304– 305 q Emerald Group Publishing Limited [ISSN 0736-3761] [DOI 10.1108/07363760510623885]
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How excessive restrictions on signage backfire
Journal of Consumer Marketing
Charles R. Taylor
Volume 22 · Number 6 · 2005 · 304 –305
that they could expect an average loss of sales in excess of 12 percent if they lost access to billboards. Studies of larger businesses also demonstrate the profound impact of signs. For example, a study conducted by Pier One imports indicated that inadequate signage for one of its stores in Germantown, TN depressed sales by 30 percent. Spurred by a restrictive sign code in Agoura Hills, California, Burger King conducted a field study which indicated that 60 percent of its store’s business was attributable to its on-premise signs, while a trial court found that removal of McDonald’s pole sign at its Agoura Hills store would result in at least a 35 percent loss of sales (US Small Business Administration, 2003). Signs play a vital role in integrated marketing communications (IMC). Belch and Belch (2004) note that the consumer’s perception of a company is a synthesis of the bundle of messages they receive and contacts they have with the business. Signs interact with advertising media to help form both store image and the overall impression the consumer has of a business. Excessive regulation of height, illumination, or colors of the sign does not impair the ability of the sign to build and reinforce the image of the store effectively. Based on their role in IMC and their ability to serve as visible symbols of the company, signs contribute to brand equity. As noted by Keller (2000), building brand equity is now a top priority of companies of all sizes and types. This role of signage in building brand equity was readily apparent in a recent case involving the Lanham Act (Blockbuster Video, Inc. & Video Update v. The City of Tempe, 1998). The case involved Tempe’s requiring that mall signage conform to certain color schemes. One of the plaintiffs, Video Update had not been allowed to use its logo unless its red letters were changed to white. The City also found that Blockbuster’s blue and yellow ticket logo did not conform to the code. The outcome of this case was that Blockbuster and Video Limited were allowed to use their logos, but it is not yet clear that a precise interpretation of the Lanham Act across Courts has been settled. A clear interpretation of the Lanham Act in these types of cases is needed, as misguided regulations on color, size or height should not be allowed to impede company’s ability to build brand equity through via the use of its trademark. The notion that communities gain business as a result of restrictive sign codes is completely lacking credible research support. Scenic America (2003) argues that sign free communities are more attractive to people, and, hence, foster business and tourism. However, reliable evidence demonstrates that the opposite occurs when signs are restricted. For example, Lilley et al. (2001) used government tourism indices in finding that Vermont and Maine, two states that have banned billboards, significantly lag behind other states in growth in income from tourism. Thus, the argument that restrictive sign codes are good for business and tourism is without verifiable merit – and clearly misplaced. Consumers understand that signs help them to find businesses and expect to easily detect and read them. Most
consumers do not find signs obtrusive or irritating. A metaanalysis of 36 public opinion polls on billboards found that just 27.8 percent of the American public believes that billboards are annoying, while 83.7 percent find billboards to be informative (Taylor and Franke, 2004). The overwhelming majority of the population also views billboards as helping businesses and creating jobs. While the public does express some reservation about the aesthetic qualities of billboards, when asked directly, over 70 percent indicate that the benefits of billboards outweigh the costs. Highly restrictive sign codes are not good for businesses or consumers; the critics’ primary arguments in favor of sign regulation are misguided and have been refuted by credible research. Signs are an important contributor to economic vitality. While there is a segment of the public that dislikes signs from an aesthetic viewpoint, the subjective opinion of what is a minority should not drive regulation.
References Belch, G.E. and Belch, M.A. (2004), Introduction to Advertising and Promotion, 5th ed., McGraw-Hill, New York, NY. Berman, B. and Evans, J. (1998), Retail Management, Macmillan, New York, NY. Blockbuster Video, Inc. & Video Update v. The City of Tempe (1998), 141 F.3d 1295 (9th Cir.). Keller, K.L. (2000), “The brand report card”, Harvard Business Review, Vol. 78, January/February, pp. 3-10. Lilley, W. III, DeFranco, L.J. and Buffalo, C. (2001), An Analytical Inquiry: Do States that Ban Billboards Have Increased Tourism and Improved Economies?, iMapData Inc., Washington, DC. Scenic America (2003), Billboard Control: Fighting Visual Pollution, Scenic America, Washington, DC. Taylor, C.R. and Franke, G.R. (2003), “Business perceptions of billboards in the US economy”, Journal of Advertising Research, June, pp. 150-61. Taylor, C.R. and Franke, G.R. (2004), “An assessment of the highway beautification act’s consistency with American public opinion”, Proceedings of the 2004 Marketing and Public Policy Conference, pp. 83-5. Taylor, C.R., Claus, S. and Claus, T. (2005), On-premise Signs as Storefront Marketing Devices and Systems, US Small Business Administration, Washington DC. US Small Business Administration (2003), Signage Sourcebook: A Signage Handbook, US Small Business Administration, Washington, DC.
Further reading Claus, R.J. and Claus, K. (1975), Visual Communication through Signage: Sign Evaluation, Vol. 2, STC Media, Tuscon, AZ. Scenic America (n.d.), “Why do we need billboard control?”, www.scenic.org/billboardsign/billboardcontrol.htm (accessed April 20, 2005).
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