Effective Sampling Strategies

There is no better way to get people to try a product than to give it to them. And there is an art to giving away products so that you get a good return on your investment. This article explains the whys and hows of cost-effective sampling, and lists resources that can help.

OVERVIEW

"Try before you buy." What could be more enticing? Everybody loves to get something for free. And when you receive a sample of something you're not familiar with, not only is there no financial risk, there's also the anticipation of discovering something you'd like to taste, use, or experience again. No wonder people eagerly reach for samples.

But why do marketers offer samples? Because they work. Studies repeatedly show that the most effective way to get someone to try a product--and subsequently buy it--is to give that person a sample (see Statistics). That's why Neutrogena many years ago began placing sample sizes of its glycerine soap in hotel bathrooms. That's why Butler and Procter & Gamble give dentists toothbrushes to pass on to their patients, why Hall's puts bins heaped with its cough drops in theater lobbies, Warner-Lambert puts Dentyne gum packs into plastic pouches slipped into Sunday newspapers, and Kellogg hands out single-serving packs of its new Smart Start cereal on street corners. "If you have a quality product, the most impactful tactic to generate trial and gain new users is to give a free sample," says Paul Theroux, president and chairman of the Promotion Marketing Association (PMA).

PMA's Product Sampling Council (PSC) defines a sample as "a regular or special size of product designed to generate consumer trial." A sample can be used to introduce a new product, encourage nonusers to try an existing product, encourage current buyers to use the product in a new way, or expand distribution into new areas. Product sampling is a tactic intended primarily to develop users who will remain loyal over the long term. It is therefore unlike such tactics as price reductions, sweepstakes, or contests, which are intended to boost purchases during a specified promotional period.

WHY SAMPLING IS POPULAR

Because sampling is such an effective sales promotion tactic, its use is growing. Companies spent $924.8 million on product sampling programs in 1997, up 9 percent from $856.3 million in 1996, according to Promo magazine's 1998 Annual Report of the Promotion Industry (see Key Research). In 1996, the gain was even higher: 11 percent.

Two developments are contributing to the increased use of sampling. The first is the expanding means for delivering product samples. No longer is direct mail--that is, samples delivered by the United States Postal Service--the only choice. Trial & Conversion III, the third edition of a special report issued by the PMA's PSC, lists many other options, including the following:

• Canvass sampling: Teams travel outdoors in a specific geographical area, handing samples to consumers.
• Cooperative sampling: Several samples are packaged and distributed together, and their manufacturers share all costs.
• Event sampling: Samples are given to consumers during an event, such as a concert or sporting event.
• In-pack/on-pack: The sample is either affixed to the package of a related product or is packed inside.
• In-store sampling: Samples are distributed to consumers in a retail outlet that sells the product.
• Magazine/newspaper sampling: Samples, usually polybagged, are delivered to subscribers along with the periodical.

The second reason for the growth in product sampling stems from the first: With the arrival of new means of delivery, sampling is much more affordable. For example, cooperative programs enable manufacturers to share all costs, and in-packs/on-packs and magazine/newspaper sampling reduce distribution costs.

COST STRUCTURE

Cost reduction is important because sampling is an expensive form of promotion: product is given away. But the product is not the only cost. When, say, direct mail is the vehicle, there are the added costs of postage and packaging. If the sample is handed out, perhaps demonstrated as well, the individuals doing the demonstrating and distributing must be paid. According to Tim Quinn, co-chair of PMA's PSC, cents-off coupons cost a manufacturer $6 to $8 per thousand for printing, distribution, and redemption. Product samples sent by direct mail, however, cost between $200 and $600 per thousand by the time the packaging and distribution are factored in. (Cooperative sampling and other forms of alternative delivery can lower the range to $160-$200 per thousand.)

Although the use of product sampling is growing, it still accounts for a mere 1.2 percent of the $79.4 billion spent on promotion last year, according to Promo magazine's 1998 Annual Report of the Promotion Industry. "Sampling was always the forgotten idea," says Quinn, noting that the PSC was founded to make manufacturers aware of the effectiveness of the technique. So committed is the PSC to its mission that its members, all industry suppliers (and thus competitors), will, on request, jointly present a small trade show on the premises of manufacturers who want to learn more about the whys and hows of sampling.

Usually thought of as a way to promote consumer products, sampling is also an effective business-to-business tactic. Perhaps the most common usage is the sampling of advertising specialties. For example, a company might send an executive a free desk diary or wall calendar imprinted with his or her company's name, hoping that the recipient will like it enough to order several as gifts for clients. And the free issue of a periodical is routinely used as an enticement to subscribe to business as well as consumer publications.

STATISTICS

Numerous studies of sales promotion techniques provide valuable insights into the use of product sampling--how effective it is, which vehicles consumers prefer, and the differences between men and women in responding to it.

The primacy of product sampling is revealed in Yankelovich MONITOR 1997, a consumer survey prepared for clients of the market research and consulting firm Yankelovich Partners, Norwalk, CT (see Key Research). When 2,500 consumers nationwide were asked to rank 17 inducements to try a new product or brand, 65 percent ranked "a sample package or free trial size" as number one. Product sampling thus ranked significantly higher than coupons (preferred by 35 percent of the respondents), refund/rebate offers (32 percent), TV advertising (25 percent), magazine advertising (19 percent), and newspaper advertising (17 percent). When the results were segmented by gender, 73 percent of women and 57 percent of men ranked product samples number one.

Target Marketing & Research, Inc., a Huntington, NY, company that specializes in hand-to-hand sampling, conducted two series of consumer-intercept interviews, one at state fairs and special events, the other in business districts. More than 4,000 consumers in 21 cities were interviewed for the study, The Second Annual Survey of Consumer Preferences for Product Sampling. Among the major findings:

• Free samples were the number-one brand influencer, with a rating of 7.78 on a scale of 10. They outranked word-of-mouth (7.18), coupons (5.91), advertising (5.61), and games and contests (1.24).
  
  
• More than seven out of ten "special-event" respondents and nearly six out of ten "business-district" respondents said that a free sample would encourage them to try a product.
  
  
• Nearly seven out of ten respondents at special events and nine out of ten respondents in business districts said that they would switch brands if they were satisfied with a free sample.
  
  
• Men prefer, and are more likely to use, hand-delivered samples, whereas women prefer, and are more likely to use, mailed samples.

In the Cox Direct 19th Annual Survey of Promotional Practices, nearly half (47 percent) of the consumers responding agreed that "they would switch brands if they liked the free sample," and 42 percent agreed that "they often become aware of new or improved products through samples or coupons."

CRITICAL ISSUES

The following guidelines will help marketers realize the greatest return on investment from a sampling program:

Determine if the product will benefit from a sampling program. Does it have a competitive advantage? "If it's parity or worse, the last thing you want is for people to try it and not like it," warns PMA president Theroux. Another concern: If purchases in this category are based on price, your product's quality advantage will be unimportant.

Be sure that sampling is an appropriate--and legal--tactic for the product. Most states have laws prohibiting distribution of samples of alcoholic beverages, for example. Quinn of the PSC also cautions against offering samples of a product that could potentially be harmful if used incorrectly or by the wrong person. Example: cleaning products for sink drains. Another poor candidate for sampling, he says, would be a perishable or fragile product that might not be in prime condition when it reaches the consumer.

Offer a sample that is large enough to be persuasive. It takes only one bite for a person to know if he or she likes a food item being sampled. But a product like shampoo must be used a few times before the consumer can evaluate it, Theroux points out. For such a product, he advises providing either a large sample or several small ones.

Evaluate costs at each step. Consider, for example, whether it will be less expensive to give away a full-sized sample than to retool to produce (or pay a supplier to produce) a smaller size. At the same time, remember that a larger, and thus heavier, sample will cost more to deliver. That holds true even if you're not using the mail: Sampling companies charge by weight also. Samples that are awkward in size or shape, or difficult to handle or insert, also cost more to ship.

Target recipients as specifically as possible so you don't waste distribution. Demographic and geographic criteria are important. So are lifestyles (for example, sports enthusiasts, photography hobbyists, pet owners) and life stages (new mothers, parents of children of certain ages, college students, active adults). Some suppliers have finely focused databases that can make your program more cost-effective.

Select the appropriate vehicle. Based on your target audience, decide whether you can expect the best results from direct mail (solo? co-op?), in-store, on-pack/in-pack, and so on.

Consider including a coupon. This adds little to the cost of the promotion, and there are two major benefits. First, research shows that by encouraging the first post-sample purchase, a coupon increases the conversion rate, the percentage of triers who become buyers. Second, redeemed coupons are an effective way to track post-sample purchases and thus evaluate the effectiveness of the sampling effort.

Understand that sampling costs are fixed. When marketers offer cents-off coupons, for example, they pay redemption costs only for the coupons actually used. But 100 percent of samples are distributed. The downside: The full amount budgeted for the program is spent. The upside: There are no surprises; the total cost is known in advance.

Select a professional supplier. There are many parts to a sampling program, and it's important to select a supplier that can do everything right. The sample must be carefully filled or packaged and properly wrapped for distribution. Whoever receives the samples for distribution must protect them, give them only to the intended recipients, and give each recipient only one sample. The distribution list must be properly targeted. Choose a supplier from a reputable source and check references (see Finding a Supplier).

Have a method for evaluating results. "If there's no way to measure results, people are wasting their money," says Quinn. As mentioned above, coupons provide an easy way to track response. But amount of product sold isn't the only consideration. Increased publicity, or retailers responding by stocking more product or allotting more shelf space, can also indicate success. Remember that sampling is a long-term tactic, and any result that can build sales over the long term is a plus.

FINDING A SUPPLIER

Many suppliers can handle all the steps in the sampling process. These include: taking the sample from the client or finding a co-packer to fill the sample size; providing or developing a targeted list; putting the sample into a pouch, sample bag, or whatever is appropriate; shipping the sample; distributing it. The following sources list full-service suppliers as well as those that can handle segments of the process:

SourceBook from Promo magazine includes a listing of suppliers that can help with sampling programs. Categories include FSI (free-standing insert) Programs, In Pack/Out Pack Programs, Mall Marketing, and Sampling Programs. 228 pp. Free to subscribers, $49.95 to others. Call 888-892-3613; fully searchable online at http://www.promomagazine.com.

Promo magazine includes a Resource Center, a guide to services and suppliers, in each regular issue (see Publications for subscription information).

Promotion Marketing Association, Inc.'s annual membership directory includes an extensive listing of suppliers that can assist with sampling programs or provide turnkey programs. 164 pp. For sale to members only, $45. Call 212-420-1100.

ASSOCIATIONS

Promotion Marketing Association, Inc. (PMA) has 700-plus member companies worldwide representing all aspects of the promotion marketing industry, including goods and services companies, promotion agencies, service supplier firms, and law firms that specialize in promotion and advertising law. PMA's Product Sampling Council (PSC) aims to raise the standards of the sampling industry and, by providing educational forums, assist marketers in their quest for excellence. PSC has 60-plus supplier members and a Senior Advisory Council consisting of ten manufacturing companies. It co-sponsors the annual Stand-Out Sampling Strategies Conference, meets during Promo Expo and Update '99, and produces periodic Trial and Conversion reports (see Publications). Call 212-420-1100; go to http://www.pmalink.org/.

CONFERENCES AND TRADE SHOWS

For a list of Industry Events, go to #9510, Calendar of Industry Events.

KEY RESEARCH

Cox Direct 19th Annual Survey of Promotional Practices (1997) is divided into three sections. The Consumers section reveals consumers' preferred sources of product samples and how they are affected by sampling programs, as well as other types of promotions. The Packaged Goods Manufacturers and Grocery Retailers sections analyze respondents' usage of various promotion types. 60 pp. $195. Call Cheryl Ingle at 800-213-9250.

Yankelovich MONITOR is an annual survey of 2,500 American adults that tracks values, beliefs, and lifestyles. Available only to clients of Yankelovich Partners Inc., a marketing research and consulting firm, as part of a client-customized package. Call 203-846-0100.

The Second Annual Survey of Consumer Preferences for Product Sampling reports on consumers' preference for various sample-delivery channels. Results segmented by gender, lifestyle. 250 pp. $175 from Target Marketing & Research, Inc. Call 516-271-1130.

The 1998 Annual Report of the Promotion Industry was published in the July 1998 issue of Promo magazine. It describes spending and trends in the 13 categories that make up the $79-billion promotion industry. 38 pp. $17.95. Call 888-892-3613.

BOOKS

Analyzing Sales Promotion: Text and Cases, by John C. Totten and Martin P. Block. Uses sales data generated by in-store electronic scanners to explain sales promotion strategy and its place in an integrated marketing program. 226 pages. Dartnell Corp. $34.95; through Amazon.com, $24.47.

The Dartnell Sales Promotion Handbook, edited by Tamara Brezen Block and William Robinson. More than 30 of the world's leading sales promotion authorities share their marketing wisdom in this book, which is filled with sales promotion plans that prestigious companies have found successful. 910 pp. Dartnell Corp. $69.95; through Amazon.com, $48.96.

The Only Sales Promotion Techniques You'll Ever Need, edited by Tamara Brezen Block. Explains the basics of a wide range of sales promotion techniques, sampling included, and makes suggestions for effective implementation. 267 pp. Dartnell Corp. $39.95; through Amazon.com, $27.97.

Promotional Marketing: Ideas & Techniques for Success in Sales Promotion, by William A. Robinson and Christine Hauri. 192 pp. NTC Publishing. $23.95; through Amazon.com, $19.16.

Sales Promotion Essentials: The 10 Basic Sales Promotion Techniques . . . and How to Use Them, by Don E. Schultz, William A. Robinson, and Lisa A. Petrison. A comprehensive treatment of ten key sales promotion techniques, including product sampling: how each one works, pros and cons, how each can be used alone or as part of a long-term sales promotion or marketing plan. Especially useful is the description of the varying degrees of consumer loyalty and recommendations for which consumer groups are most responsive to which sales promotion techniques. 208 pp. NTC Business Books. $19.95; through Amazon.com, $15.96.

PUBLICATIONS

Brandweek, 47 issues per year, bills itself as being edited for marketers of America's top 2,000 brands. Includes information on marketer/retailer relationships, promotion, new products, media strategies, and agency/client relationships. $130/yr. Call 800-722-6658; go to http://www.adweek.com.

PROMO, monthly. PROMO defines promotion trends, presents critical "how-to" information and case studies about promotion, and serves as a meeting ground for companies and professionals in the industry. Free for qualified subscribers, or paid subscription is $65 p/year. Go to http://www.promomagazine.com.

Promo's Fast Fax offers Promo magazine special reports by instant fax. Topics include promotion research, product sampling, mall marketing, in- and on-pack promotions. $9.95 each. Call 800-254-1785.

Trial and Conversion study. Published periodically under the auspices of the Promotion Marketing Association's Product Sampling Council; usually inserted in major industry magazines and also offered for individual sale. Topics include guidelines for sampling success, case histories, glossary. Next issue: November 1998. Call 212-420-1100.

The following publications occasionally include articles on product sampling strategies:
Advertising Age. Weekly. $109/yr. Call 800-678-9595.
Sales & Marketing Management. Monthly. $48/yr. Call 800-821-6897.
Sales and Marketing Strategies and News. Nine issues. $49/yr. Call 815-963-4000.

ONLINE SERVICES

• Adweek/Brandweek/Mediaweek. All three publications can be accessed at this site. Subscribe here, search the Articles archive for all articles published since 1991, and download articles for a small fee. Go to http://www.adweek.com/.

RELATED SMN ARTICLES

For information related to product sampling, see #9110, New Product Launches.