The days of hum-drum, in-store sampling may be numbered.
Retailers said they want more than locally funded promotions with bored demonstrators handing out, say, a wedge of cheese to disinterested shoppers. They are looking to engage their customers with stylish, well-orchestrated events funded by national marketing dollars. Such events aim to do two things: one, boost category sales by providing an incentive to buy the product, and two, enhance marketing by providing a "live" advertisement for the brand.
"Sampling is effective because it gives customers an opportunity to see, smell and taste a product," said Mona Golub, manager of public relations and consumer services at Price Chopper Supermarkets, Schenectady, N.Y.
"We sample everything from a dip that has five ingredients to a meatball sauce that has less than five ingredients. We hand out recipes at the samplings. Customers have come to look for them and keep them. So it gives us the opportunity to not only sell the item being sampled, but also the items in the recipe," she said.
Tim Hawks of Arc Marketing USA explained that elaborate events are funded nationally but coordinated locally. "It's a new age of spending that's bought out of consumer budgets but managed by local sales and marketing folks," said the managing director of retail marketing for the Greenwich, Conn., firm.
He used the example of Morningstar Farms, which has provided samples of its vegetable burgers to shoppers around the country for the last two years. Working with most major supermarket retailers, Morningstar -- a division of Kellogg USA, Battle Creek, Mich. -- drives a vehicle to the store's parking lot and stages an event. Trained personnel prepare the burgers so the quality is consistent and the brand message is memorable.
Makers of grocery products such as Morningstar are intrigued by the idea of working with retailers to deliver a dramatic brand message directly to consumers at the point of purchase. Many are dismayed by the steady decline in the effectiveness of television advertising and mass marketing in general. Executives who study sampling believe retailers can stage live events that rival television commercials.
"With any type of sampling of a new product, the relative advantages are very difficult to talk about via advertising. You need to show [the consumer]. It's like a TV infomercial, but right in front of you," said James Maskulka, associate professor of marketing at Lehigh University, Bethlehem, Pa. "Sampling permits live interactive product-use experiences. TV has never been able to deliver those advantages."
Because 70% to 90% of purchase decisions are made in-store, Greg Kahn of the Kahn Research Group said manufacturers who focus on the in-store marketing will fare better than those who focus on traditional advertising. "In fact, we often tell clients to let their competitors bring customers into the store through traditional advertising and then steal those customers through effective in-store marketing efforts," said the CEO and founder of the firm based in Huntersville, N.C.
Research about the decline in the effectiveness of traditional media continues to mount. According to a report by Forrester Research, Cambridge, Mass., consumers with personal video recorders -- half of the U.S. population in five years -- will watch TV on their own schedules, increasingly skipping the commercials. The firm predicted a 30% decline in commercial viewing, leading to the loss of $18 billion in traditional ad revenues.
Recent studies indicate that consumers have been spending less and less time viewing traditional media, including watching network TV, reading magazines and reading the newspaper, especially in Internet-connected households.
"Research shows that more consumers -- our customers -- are watching less television in favor of spending time online," said John Leonard, divisional vice president of grocery sales and merchandising for Kmart Corp., Troy, Mich. "We must make sure that we continue to generate methods of reaching customers with our brands and our products."
Price Chopper is certainly investing in sampling to target shoppers at the point of purchase. The chain stages 400 sampling events each week in its 101 supermarkets in six Northeastern states.
"Some messages in the media are diluted because they're sent out over broad airwaves," said Golub of Price Chopper. "But the customer who comes to the store is open to the experience of grocery shopping. Anything you do -- including sampling -- to enhance that experience also enhances the opportunity to not only sell product, but to interest consumers."
"Live commercials have impact at the point of purchase," added Suzanne Gocke, senior vice president, retail at Mass Connections, a national marketing management company based in Cerritos, Calif. Peter Leech, managing partner of Chicago-based Equilum Consulting, said that manufacturers are beginning to appreciate the power of "retail media" and its ability to target consumers. "I am a big believer in the idea that retailers are media companies, and that they are a medium to the consumer," he said. "Many manufacturers are getting more comfortable with the idea of national marketing dollars being spent at the retail level."
If in-store sampling events are to compete effectively with national marketing vehicles such as television, there must be a measurement in place to quantify the results of sampling, according to Bill Bishop, president of Willard Bishop Consulting, Barrington, Ill. His firm has taken the first steps toward such measurement by suggesting a system of "gross rating points."
"If [in-store] wants to be seriously considered as an advertising medium and compete with other mediums, we have to have our own measure of effectiveness," he said. "To begin the process, we have to show how we can generate gross rating points on a cost basis that turn out to be competitive to -- if not superior to -- what's going on with TV." Bishop pointed out that both in-store sampling and TV advertising can create brand awareness. But the former has an edge of lifting sales via promotion at the point of purchase.
"When you do any kind of in-store sampling, you're actually doing two things at the same time," he explained. "You're selling product and you're in effect doing an advertisement inside. You've got to add those two benefits together. You need to go through the traditional lift analysis, which would be selling product, and then you need to add the gross rating point measurement to get the credit for the advertisement component. Add those two together and then make a judgment about the value of the proposition. It seems to me that being able to do two things at the same time with the same set of expenses is likely to have certain advantages.
"There is a certain increase in style and grace and messaging if we are going to do in-store advertisements that qualify for gross rating points. If the occasion around the in-store event causes us to pause and change our mood, it becomes a moment of relaxation, a moment of relief from pressure, and a moment of discovery. Those are experiences that have value in their own right," he said. By working together, trading partners said they can maximize the image of the brand and the store, as well as stage an event with enough merchandising flair to engage the shopper and ensure a return trip. All it takes is a little collaboration.
Timelines, goals and communication are critical to successful sampling events, according to Kmart's Leonard. "The most successful events happen when sufficient time, information, preparation and training are implemented. Collaboration is key. It is imperative that you allow each entity -- retailer, manufacturer and the management company -- to be included in the inception of any large-scale or high-profile events," he said.
Golub of Price Chopper said the relationship with manufacturers is "critical" to the success of a program. "We are basically selling our services to promote whatever that manufacturer has to offer right in front of the consumer," she said.
"It is an opportunity for a deeper partnership than some other parts of the marketing mix because it's both organizations truly reaching the customer together," said Steve Michaelson, who until January was senior vice president of marketing at Wegmans Food Market, Rochester, N.Y. The upscale chain in the Northeast successfully stages "meal-oriented demos" involving several brands. "It's more challenging than pouring a cup of soy milk," he said.
"If it's not done on a truly collaborative level, then I'd rather not do the demo," said Jeff Tripician, who is a partner with Michaelson in TM Branding, a consultancy based in Boulder, Colo.
