Thursday, April 27, 2017

Attention Brand Managers!! Is there a Price to your Free Sample?

Trial generation through sampling is a widely employed strategy in FMCG industry. Though numerous factors contribute to the success of your sampling campaigns, have you ever wondered whether customers pay any attention to the MRP or perceived price of such free samples or in other words, is there a correlation between the sample price and the performance of a sampling initiative? We know price does sound like one of those remote variables with little or no consequence,  but here's something interesting we found.

We conducted a small study of 10 GT sampling campaigns closely similar to each other in terms of target market, brand value, campaign promotional efforts, product utility and mode of sampling. The only distinctive factor among these campaigns was the price of the product being sampled. We studied redemption rates, satisfaction percentage & general feedback to analyze whether there exist any relationship between Sample Price & Campaign Success Rate.

 So here’s what we found.

Although product samples are priced at zero for customers, surprisingly Price of a sample has a strong correlation with Sampling Campaign Success rate.

Customer Enthusiasm is observed to be much higher when the pack price is anything higher than Rs. 20. A jump in redemption rates was observed varying between 10-14%. Customers felt rather more incentivized for their effort while availing a pricey sample.

However, Customers also seemed to be far more critical for such expensive sample since they associate high perceived value. 65% of respondents agreed to have strong expectations from a sample priced over above Rs.50. They attach positive perceptional utility value to such samples even before trial and thus the zone of tolerance contracts.

A sample priced anywhere below Rs. 10 triggers a connotation of the sampling Brand as an unestablished one among at least 45% consumers. Consequently, consumer interest in trials significantly reduces.  In such cases even if the consumer takes off such product from store, there is high likelihood that it would not be experienced.

Recommendation & Conclusion

Price of sample since strongly correlated with the success ratio of sampling campaigns should be defined after a thoughtful consideration of the target markets. In our experience a FMCG product sample priced anywhere above Rs. 10 is certain to drive better results. For assistance on right sampling strategy to meet your market objective, Get in touch with our team of experts at +91 11 39586001.


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Alicia Thompson said...

Great article! I love that you've covered the topic of product samples. It especially important for review of, as you always need to read the sample of the work before you can order it.

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