If I had a nickel for everytime I heard a variation of this question, I wouldn’t need to write this blog. Whenever the discussion about the value of in-store sampling or in-store product demo, I always ask - “compared to what”?
CPG retail marketing strategy has a number of tools to create and/or improve customer demand which is the main goal of such investment. There are many people who would argue that nebulous terms like “brand awareness”, etc are also critical elements of retail marketing strategy. I would respectfully disagree with pursuing a goal that cannot be quantified in a meaningful way. Brand is what consumers think about a provider of products, based on their personal experience with these products or the personal experience of other consumers, they can relate too.
Therefore if products, collectively marketed by a brand A, consistently deliver an experience that exceeds consumer expectations over a period of time, the reputation of brand A is being built and its value is increasing. From this perspective any funds invested in activities promoting a brand outside of experiential marketing channels, are very expensive - because they deliver results which are very hard to measure or not relatable to actual business goals, i.e. Low or No Return on these investments.
There are many definitions of a retail marketing strategy that can be found online, in magazine articles and in thick paper books, but in simple words they all agree that retail marketing strategy is any set of activities that increase retail shoppers' traffic AND increase sales of the products in stores.
Marketing managers often use in store promotions to stimulate sales of the products and improve customer experience. Sow, why do so many CPG brand builders think that in-store sampling is more expensive than other marketing investments?
Here are a few reasons why some retail marketing strategy practitioners hold this opinion:
In conclusion, an in-store sampling is not “expensive” or “cheap”, it can be valuable or wasteful. It is not just WHAT you choose to do, it is HOW you decide to execute it. If you are ready to extract measurable value from your in-store experiential marketing investment, we can help to make it a reality.
Business publications and news outlets bombard us with news about rising inflation and upcoming recession every single day. Our lives are impacted by higher costs of everything we need as consumers, but we also are facing business challenges as providers of goods and services.
In the past few years, retail customers have been through a lot. Having a supply chain breakdown, experiencing social isolation, or having difficulty finding products all combine to create a negative effect. Consumers are on edge as prices rise, and brands as well as retailers are keenly aware of this. Because of this, 29% of retailers are concerned that any price change may result in negative consumer reactions
Most business leaders know that there are limits to consumer price elasticity and hard decisions will have to be made in order to maintain the proverbial “ship” afloat.
Of course there are no simple, binary answers to these questions. However, it is critical to remember that this storm will pass too, but decisions that may help you to weather this storm may cause structural damage to your vessel, if you are not careful.
When a company is looking to cut operational costs it is far too often an investment into a retail customer experience coming first on the chopping block.
Retail Marketing Strategy - Tale of two brands
They say history does not repeat itself, but it rhymes. During the 2007 recession most brands closed up the hatches to weather the storm. At that time if you were looking to buy a sailboat, computer images and magazine ads were only means for “experiencing” a product which sells for hundreds of thousand of dollars. No dealer in the US had a product in their inventory to actually come aboard and to take for a sale. No dealer, except the one who signed with a European sailboat brand whose name starts with “B”. They took massive loans to finance boat inventory in the dealer's showrooms when American boat manufacturers were waiting out the recession. Today, nearly every second boat sailing American waterways proudly carries the brand “B” name on their bows. Are they better built boats? Hell, no. As a sailor with a few thousand miles of open ocean sailing experience, I can categorically say that the “B” boats are substantially lower quality of design and construction than most brands they annihilated by gambling on providing better retail customer experience. No they are lower priced.
Another example is an automotive brand starting with “H”. They remembered what the word “brand” means. To consumer brand means trust, and while other competitors reduced their call center staff that helped and supported their customers, the “H” launched a buy-back program in the middle of recession. They allowed Americans to buy a new car which could be returned if they lost their jobs. Sales for “H” rose 5% in January and February 2009, a time when much of the rest of the auto industry experienced steep losses. This move established their brand in the United States’ consumer’s mind where before their name was a favorite target of late night TV comedians.
Consumers are now unusually anxious because of the rise in the price of products, but consumer resistance to higher prices can be reduced by an opportunity to have a highly positive experience of the product prior to purchase.
In Store Product Demo is a part of Retail Marketing Strategy
Instead of reducing the volume or quality of your product while maintaining your price, you can explore an in store product demo as a better retail marketing strategy. The moment you do this, you take your prospect's eyes away from the price and let them see for themselves how the value trumps the price. Leverage promotional scheduling calendar to make in store demos an ever present part of your store experience to make your customers focus on their experience of new products instead of sticker shocks of the products they used to buy.
According to Shopify, In Store Product Demo helps you test new brands or products, enhance in-store experience, improve customer loyalty, Increase sales and gather customer feedback.
Shopify also advises to do the following before embarking on in store sampling: review inventory levels, consider hiring brand ambassadors, combine demos with promotions to boost sales, be selective with demo products and promotional scheduling during business peak hours.
The impact of inflation on customers cannot be overlooked. It is a reality that has come to stay and retailers must combat to ensure viability and profitability. It has been established that price reduction and discounts are not the best strategies to achieve the best retail customer experience. Adopting an in store product demo strategy seems to be a more feasible approach to tackling consumers' response to inflation. Retailers should also be vigilant to observe new consumer behavior by occasional market research.
Facing inflationary pressure, many retailers and established brands are prone to making exactly the wrong decisions - serving less product at the same price as before, or reducing customer service. These decisions are designed to defend decreasing profit margins at the expense of their customers’ experience. Yet it is their prior extensive investments in their customer experience that made them what they are today. Betraying trust of your customers opens opportunities for fledgling startups who care more about cost of customer acquisition than the next quarter margin. In store product demo is the best tool of experiential marketing strategy to steal customers from those established brands who are spooked by inflation.
The pandemic-led sudden growth of eCommerce and widespread lockdown brought intense competition for brick-and-mortar stores. Physical retail has been severely threatened over the last few years, but as the world finally opens up, there may be some respite for store owners.
The good news is that despite the preference for online shopping, 55% of buyers still advocate for traditional stores because that's where they get to interact with products directly.
So, as social distancing restrictions are lifted, it's time to use exciting new retail marketing strategies to empower your traditional retail practices.
Your prospective buyers appreciate that your brick-and-mortar store can offer what eCommerce giants can't: instant gratification in the form of immediate purchases, no shipping costs, and no costly returns because they've tried or experienced the product before buying.
So, why not take advantage of demo scheduling software to consistently generate customer demand and optimize inventory turnover? This can be your secret to delivering the ultimate retail customer experience.
Let's explore this retail marketing strategy in further detail.
Taking Advantage Of The Shift In The Retail Marketing Paradigm
Retail marketing can surely help your business expand its reach, connect with customers, nurture long-term relationships and share your brand story. Not only this, but retail marketing also creates a competitive edge, keeping your business one step ahead of its rivals.
Modern retailers need to keep an eye on different channels, tactics, and activities that bring visitors to the store.
Use Demo Scheduling Software To Delight Your Store Visitors & Customers
For obvious reasons, in-store demos have become an integral part of retail marketing strategy. Retailers need reliable and hassle-free demo scheduling software that delivers cost-saving without compromising their retail customer experience.
It is not just an occasional promotional event to sell the dead inventory; it's the best way to introduce your customers to new products and record sales. It's a building block responsible for growing relationships between customers, vendors, and retailers.
In a nutshell, demo scheduling software helps with:
Embrace In-Store Sampling To Boost Your Brand Reach
Retailers have discovered the power of in-store sampling as an experiential marketing strategy. According to Win Sight Grocery Business, it's among the most potent experiential marketing tactics, recording a 475% increase in sales. Its when the customer is given a free sample of the product, which is an opportunity to try it.
Another study stated that in-store food sampling converted browsers into buyers with a 20% increase than the customers who didn't sample the product. It also revealed that the conversion rate for personal care and beauty products is 30% higher with the in-store sampling tactic.
Ready To Reinvent And Redefine Your Retail Customer Experience?
Promotional scheduling outlines the specifics of the marketing initiatives your retail store will take part in for the entire year. It ensures that the store staff, managers, and marketers are always on the same page while eliminating missed deadlines or forgotten ideas for good.
The retail industry has become hyper-competitive. Hence to improve the impact of its promotions, it's essential to create a promotion scheduling model designed to deliver enhanced ROI. According to research, an efficient promotion calendar showed a 4% uptick in-store revenues and a 14% increase in ROI.
The modern retail marketing strategy isn't restricted to the 4Ps of marketing; instead, it focuses on delivering the ultimate customer experience to keep those visitors coming. Demo scheduling software, in-store sampling, and promotional scheduling can help you win the retail sales game while delighting and engaging your customers better than ever before.
While the latest “model” of the virus still feeds passionate debates about masks and vaccines, many brands are starting to promote their products at retail stores again.
The companies, interested in re-starting their demo campaigns, find that the brand ambassadors they used to depend upon are no longer available. The lock downs and public health directives decimated the market infrastructure as people were forced into relocating and taking on a different career path. Of course the brand ambassadors' scarcity is only a small part of the overall labor shortage experienced by most retailers across the country, but my exposure is primarily to in-store demo management.
There are multiple approaches to managing labor scarcity:
Most high quality brand ambassadors are self-employed, and while $25 per hour for 40 hours a week sounds like a reasonable income, 5 - 7 demos per week at 4 (paid) hours per demo, with 1.5 hours per demo of unpaid overhead, is all they can expect most of the time. That is the difference of $1,600 per month, or the "real" rate of $18 per hour part-time with no benefits.
The point is you don’t need to bust your marketing budget to attract brand ambassadors capable of producing a healthy E2P (Experience to Purchase) conversion ratio. Playing it smart generates above average returns on your marketing investment. Let's discuss how to revive your store experience and brand activation strategies.
There is a widespread belief that in-store demos only benefit vendors. However, the truth is that they offer even more numerous benefits for retailers. The well designed in-store demo strategy will bring customers back to your store over and over again, and keep them engaged with the brands you offer, which are not being promoted at the demo time. Let’s look at some reasons why vendors retailers should initiate host in-store demos.
Why Retailers Should Host In-Store Demos
In-store demos offer many benefits for vendors such as creating brand awareness, boosting sales, and increasing long-term purchasing habits. However, they also offer many benefits for retailers. Some reasons why stores should initiate in-store demos include:
It’s no secret that in-store demos can make a retail store more popular. Customers are more likely to flock to a store if they believe they will receive free samples or coupons from a demo station. In a sense, in-store demos work as free promotion for retailers brands. However, like any promotion activity, it works best when there is a regular and steady schedule.
The costs of hosting in-store demos are usually borne by vendors. They pay for scheduling the demo, hiring brand ambassadors, and providing product samples.
One may believe that retailers must also bear some costs as the demo is being held within their store space. However, these come under the existing costs that the retailer is already paying. After all, retailers have already hired staff to manage their store. The retailer employees who will help organize the vendor demo are already being paid for their time, and would be present at the store regardless of whether a product demo is being held or not. However, they have many other responsibilities and demo coordination is quite low on their list of priorities. Thankfully, automation tools like Demo Wizard are available to resolve this problem.
Improving the Retailer’s Reputation
Vendors often strive to put on the best possible in-store demos to help their products stand out. They use various strategies to grab customers’ attention and wow them in different ways. All these techniques help elevate the consumer experience.
A great in-store demo will improve customers’ perception of your store and encourage them to return in the future. All this can be accomplished without the retailer having to make any additional investment.
Getting an Edge Over E-commerce Stores
In-store demos stand above E-commerce promotions because they engage each of the customer’s senses. For example, an in-store demo of a perfume allows visitors to smell the fragrance itself. They also get to learn about the fragrance composition from the brand’s representative directly. This is in contrast to online promos where they can only see a picture of the perfume bottle and communicate with faceless chat bots or clueless support associates.
Similarly, in-store sampling of food items allow customers to taste a new product. This deeper level of engagement helps win them over and encourages them to come back and try the brand’s other food products.
In-Store Demo Strategies for Retailers
Retailers can enhance the customer experience and increase their sales by implementing the right in-store demo strategies. Some of the methods they should consider include:
Scheduling Concurrent Demos for Multiple Product Categories
Retailers may notice an uptick in sales following a single in-store demo event for a particular product. This may encourage them to host in-store demos from many brands in the course of a single month. However, a smarter strategy may be to host in-store demos for multiple product categories simultaneously. This method works especially well if the products being demoed complement one another.
For example, a retailer can host an in-store demo from a smoked salmon brand around the same time as a demo from a food storage containers brand. Customers who sample salmon at the demo station will be eager to purchase the product. They may then shift their attention to the storage containers in-store demo and gain an interest in purchasing tupperware to store their newly purchased salmon in the fridge.
This strategy increases sales for both brands, giving the retailer a significant boost in revenue. Retailers who wish to attempt this strategy should spend some time deciding which brands’ in-store demos they wish to host simultaneously.
Hosting Themed Events
Retailers often capitalize on sales during special times of the year. For example, a grocery chain may predict an uptick in candy sales around Halloween. Similarly, they may expect an increase in sales for frozen chicken wings during Super Bowl season.
Hosting in-store demos for products related to such events or holidays is a great way to increase sales and attract higher number of customers. For example, retailers can encourage candy, costume and decorations vendors to set up in-store demos in the week preceding Halloween. They can then use this opportunity to brighten their entire store with Halloween themed decorations. This arrangement will wow shoppers and also attract new customers who wish to indulge in the Halloween spirit.
Offering Coupons During the Demo
Retailers can also enhance the shopping experience for customers by offering coupons during in-store demos. These coupons could be for the product being demoed, or they could be for complimentary products that customers may be interested in.
This strategy encourages customers to make a purchase quickly. It also increases their likelihood of returning to the store in the future in the hopes of obtaining new coupons.
Tips for Running Successful In-Store Demo Campaigns
Now that we have learnt the different ways in which in-store demo campaigns win over customers, here are some tips to use them successfully.
Involve Your Marketing Team
Too often in-store demos are being set-up as one off events by the Buyers and Category Managers. Involvement of the marketers to publish and promote monthly schedules of in-store demos, will greatly improve the outcomes.
Encourage More Demos With Great Brand Ambassadors
A brand ambassador could spell the difference between success and failure for an in-store demo. A great brand ambassador understands the vendor’s target audience and knows how to pitch the product or service to them successfully.
Retailers can use software such as Demo Wizard to evaluate the effectiveness of brand ambassadors for different brands. They can then encourage brands with the top performing brand ambassadors to hold in-store demos in their store more often and block those with disappointing performance.
Analyze and Refine Your Strategy
There is always room for improvement when it comes to in-store demo campaigns. Vendors should aim to collect data related to their campaign’s success and look for ways to improve it further. This is possible with the help of in-store demo management software such as Demo Wizard.
As you can see, retailers can benefit greatly from hosting in-store demos without having to invest additional funds or resources. Most retailers are aware of demos and experienced the results they generate, BUT they see it as one off events initiated by Vendors and tolerated by Retailers INSTEAD OF as a valuable marketing strategy initiated and promoted by Retailers. In-Store Demo Strategy is an intelligent design of how to manage continuous, consistent, or at least regular presence of demos at the retail store locations for effective generation of outstanding customer experience economically. So consider trying the aforementioned tips if you want to improve your store’s sales and reputation.