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In-Store Sampling: Crunching the Economics

Economics of In-Store Sampling

Store sampling is a time-honored marketing technique in which potential customers are given small samples of a product to try before they buy. This can be an effective way to generate interest and create a favorable impression of the product. However, it is important to consider the costs and benefits of in-store sampling before deciding to use it as a marketing tool.

If you sell products that can be experienced by shoppers before they buy them, the in-store demo is the most effective method to promote them and generate a favorable word-of-mouth marketing impact. In-store sampling has been known to increase sales by as much as 2,000 percent.

Economics of In-Store Sampling

However, the short term sales spike is not the only benefit of store samplings. They introduce new consumers to your brand and often convert them into loyal, long-term customers.

In-store demos now offer an opportunity to connect directly with the customer,” says Kirsten Osolind, CEO of re:invention, a Coronado, Calif.-based marketing and public relations firm. “The more connections, the higher the sales.”

According to a study by Columbia, Md.-based market research firm Arbitron, more than a third of customers who tried samples said they bought the product during the same shopping trip. Better yet, among the more than 1,800 respondents surveyed, 58 percent said they would buy the product again after trying it. Further, a store demo not only significantly increased an item’s sales (by 475 percent), but it also boosted sales for all products in the line by as much as 177 percent on the day of the demonstration.

There are several costs associated with in-store sampling. First, there is the cost of the samples themselves. If you are giving away free samples, you are essentially giving away money. Second, there is the cost of staffing the sampling event. This may or may not include the cost of paying employees or contractors to coordinate and staff the event and the opportunity cost of their time (they could be doing other things).

The cost of an in-store demo is relatively low. Most brands pay $25-$35 per hour to Brand Ambassadors for promoting their products to the shoppers of the stores that carry them. In a good traffic store that may easily translate into 20-30 opportunities per hour for shoppers to become buying customers after they taste or try your product.

Additional costs may include Brand Ambassador's travel expense ($10-$30 per demo) and the cost of sample products. The administrative overhead of demo scheduling and coordination may add up, unless you use automation tools like Demo Wizard. Another alternative is to have a fixed cost demo company as a partner.

All this means that you can buy a few minutes of qualified (they are in the store) and interested (they stopped to listen and try) prospects for less than a dollar. Try to get such results using any other retail marketing strategy. Compare it with the cost per click in online advertising to buy a few seconds of someone's attention. Depending on your product, this cost can easily exceed $5 per click (eyeballs) of someone who is nowhere near any store that sells it.

When it comes to retail marketing, in-store sampling is one of the most economic ways to reach potential customers and increase sales and generate consistent customer demand. In-store sampling allows businesses to provide potential customers with a small sample of their product or a demonstration of the product in order to pique their interest and encourage them to purchase the product.

Not only does in-store sampling provide customers with a chance to try out a new product, but it also allows brands to create a personal connection with potential customers. After customers sample or experience products, they share their opinions and recommendations with their friends and family members to act as influencers and create a significant word-of-mouth marketing impact.

There are a number of reasons why in-store sampling is such an effective retail marketing strategy. First, in-store sampling allows brands to reach a wide range of potential customers. Unlike other marketing strategies that require businesses to target a specific audience, in-store sampling allows brands to reach anyone who happens to be in the store at the time of the sampling. This means that brands can reach potential customers who might not otherwise be aware of their product.

Second, in-store sampling allows CPG brands to create a personal connection with potential customers. When customers are given a sample of a product, they are more likely to remember the brand and the product. This personal connection can be a powerful tool in persuading customers to purchase a product.

Third, in-store sampling is an effective way to increase sales. Customers who try a product are more likely to purchase it than customers who do not have the opportunity to try it. This is because in-store sampling allows customers to experience the product for themselves and see the value in it.

In-store sampling is an effective retail marketing strategy because it allows CPG brands to reach a wide range of potential customers, create a personal connection with potential customers, and increase sales.

When it comes to in-store sampling, the economics are quite simple. Sampling is a relatively low-cost way to generate awareness and interest in a product, and it can be a very effective way to increase sales.

This free tool helps you estimate in-store demo Cost of Customer Acquisition for your product.

There are, of course, some costs associated with in-store sampling, including the cost of the product itself, the cost of staffing the sampling table, and the cost of advertising the sampling event. However, these costs are typically more than offset by the increase in sales that results from the sampling.

In-store sampling is an effective way to generate interest in a product and increase sales. The costs of in-store sampling are typically more than offset by the increase in sales that results.

That is why "One Taste Sells More Than 1,000 Ads©".