It's no secret that sampling programs can get people to try and occasionally purchase products. However, new research suggests that such giveaways can also help drive long-term sales and increase purchases of other items from the product line.
Whether it is a new product launch, line extension or established brand, sampling programs drove a 475 percent sales lift the day of the event compared to non-sampled households, per the "Report on In-store Sampling Effectiveness" conducted by Knowledge Networks-PDI on behalf of the marketing services company PromoWorks.
Those who sampled an item were 11 percent more likely to purchase it again during the 20-week period that followed. They were also 6 percent more likely to buy another item from the brand franchise.
"It's always been understood to a certain degree that there is a lift during the event. The big 'aha' is the long-term impact and the effect a sampling event has on the franchise overall," said Neal Heffernan, svp, gm at Knowledge Networks-PDI.
Participants were nine times more likely to purchase a line extension on the day of the sampling event. The sales lift continued, up 107 percent after a 20-week period.
For older, established brands, the sales lift the day of the event was 177 percent greater than the control group, which received no samples. It remained up 57 percent after a 20-week period. The sampling event also casts a halo over the entire brand portfolio, said Heffernan.
The parent brand of the product sampled received a 107 percent sales lift the day of the event and a 21 percent sales increase after a 20-week period.
(Source: AdAge.com, 08/04/09)
Tuesday, August 18, 2009
Friday, August 14, 2009
"Crisis Inspires Breakthroughs"
Steve Clark, a sales trainer that I like, wrote this in his newsletter this morning. I liked and thought I would share.
Have a great weekend!
Jeff
"Our greatness lay not so much in being able to remake the world as in being able to remake ourselves" ~ Mahatma Gandhi
Have a great weekend!
Jeff
"Crises Inspires Breakthroughs"
by Steve Clark
"Our greatness lay not so much in being able to remake the world as in being able to remake ourselves" ~ Mahatma Gandhi
"Psychological suffering, anxiety and collapse lead to new emotional, intellectual and spiritual strengths. Confusion and death can lead to new scientific ideas." ~ Dr. Ilya Prigogine
"A personality is born of chaos. Resistance to chaos can only beget more chaos and resistance" ~ Stephen Wolinsky
Failure and adversity are better teachers than success and prosperity because they require us to dig deep and discover new talents and resources not yet recognized or understood. A trip to the bottom is what fuels the trip to the top.
We learn to deal with adversity by dealing with adversity. Therefore, failure is not to be avoided it is to be embraced. This counter intuitive concept is hard for most people to understand and accept because our environment teaches us that failure is bad and should be avoided.
The kid who never falls off a bike seldom becomes the best bike rider. The salesperson who avoids rejection never gets good at selling. The best at anything have all failed thousands of times in their attempt to become good.
When we experience adversity it is hard to think beyond the immediate pain and disappointment. But moving beyond the immediate pain is what we must do if we are to grow and mature emotionally. Instead of pissing and moaning when we experience adversity we should accept it, acknowledge it and then move on by using it as a lesson learned.
In our sales training, we teach taking every failure and rejection and reflecting and debriefing in a written journal what happened, why it happened and then analyzing what we will do differently next time we are faced with that same opportunity. Failure to debrief and to rehearse how we will do it differently next time ensures that we will repeat the same behavior over and over again with the same result.
Walt Disney used his experience of being fired as a cartoonist from a Kansas City newspaper to fuel his desire to create Disney Studios. Oprah Winfrey used her experience of being fired as a news anchor in Baltimore to launch her show. Lance Armstrong used his battle with cancer to propel him to his seven Tour de France wins.
As the bumper sticker says "Shit Happens". And it happens to every one of us. Sooner or later if you live long enough you will experience failure, disappointment, a near death experience, loss of a loved one, a debilitating illness and more. Life is full of disappointment. You cannot escape it. When you are faced with these situations you can use them as stepping stones to become something greater than what you are or you can use them as excuses to self-destruct.
Since you cannot avoid failure and disappointment in this life it only makes sense that you get good at using them to make you something greater than what you are. There really is no other choice except to crawl in a hole, feel sorry for yourself and wither away. That's a miserable way to live.
(source: Steve Clark www.newschoolselling.com)
Thursday, August 13, 2009
Recession Forcing Consumers to Change Where They Shop; Who's Winning?
The recession has significantly changed the shopper mix in virtually all retail channels, according to a new report from WSL Strategic Retail. Supermarkets have regained the No. 1 share of shoppers for the first time in 10 years, ahead of supercenters. And dollar stores are in the right place at the right time with the right brands.
Meanwhile, convenience stores and drug stores are increasing their share of shoppers because they're quick, easy, less tempting and save gas, according to the report. Mass merchandisers, including Wal-Mart and the Internet, are picking up more affluent shoppers. And, with unemployment reaching 10 percent, more men are doing more of the family shopping.
Smart retailers will heed the warnings of the retail-channel shift and adapt their businesses to realize the new opportunities, the report states.
The channel shifting in the recession has had some obvious moves:
* Wal-Mart has been a winner; Target has not.
* Supermarkets and dollar stores are doing well; mall stores are not.
However, beyond the obvious, WSL said many of the shopper shifts open some immediate opportunities for retailers.Beyond that, the WSL "How America Shops PULSE" report, which compares the demographic shift in shoppers by retail channel from the second quarter 2009 vs. the same period 2008, offered these other observations:
* If your retail strategy has been very Wal-Mart-focused, it might be time to take another look at the supermarket channel.
* The obvious reason for the growth of supermarkets is the spending cuts shoppers have made in take-out food and eating out, which means more cooking at home with food purchased at the supermarket.
* 46 percent of shoppers stay out of stores where they are tempted to overspend. When you only need to buy food, the mass merchandiser has too much temptation.
* Dollar stores are in the right place at the right time --with more of the right brands. Over the last five years, dollar stores have moved well beyond their rural Southern roots to open stores in middle class neighborhoods around the country. More manufacturers are realizing the dollar-channel opportunity and selling them more national brands.
* Convenience stores and drug stores are increasing their share of shoppers, which may seem contrary to the frugal shopper mindset, but it makes sense. When shoppers don't stock up, they run out, the report states.
* C-store growth may seem like a contradiction in an era of price-conscious shoppers, but remember how shoppers are cutting back on groceries and not stocking up on sale items. That leads to running out. C-store prices may be higher, but if it's nearby and you save on gas and time, then the trade may be worth it.
* Drug stores are seeing their strongest lift among middle-aged, middle-income shoppers, who, as with c-stores, may need the drug store when they run out of something, or find it a better choice, where a trip to a mass merchandiser to save a few cents turns into overspending on so much more than what was on the list. (It's that temptation again.)
* Internet Shopping is up among the affluent, who are certain they find the best price online. From our last "Online Shopping PULSE" report in April 2008, we know that half of affluent shoppers feel they save money shopping online, and saving money is what they are looking to do more of now.
* Mass merchandisers have an increase in affluent shoppers. For the first time, the share of affluent shoppers in mass merchandisers equals that of lower- and middle-income groups.
* Warehouse Clubs have had a significant decline in younger shoppers who may have discovered that their smaller households were wasting much of what they thought they were saving by buying big club sizes.
* The mall has lost across the board -- men, women, young and old -- but with the biggest losses among middle-income families who just don't need all that temptation.A final note about male shoppers: Unemployment has taken a larger share of adult men than adult women out of the workforce, so it is not surprising that stay-at-home men are taking on more of the family shopping errands.
(Source: Convenience Store/Petroleum News, 08/10/09)
Meanwhile, convenience stores and drug stores are increasing their share of shoppers because they're quick, easy, less tempting and save gas, according to the report. Mass merchandisers, including Wal-Mart and the Internet, are picking up more affluent shoppers. And, with unemployment reaching 10 percent, more men are doing more of the family shopping.
Smart retailers will heed the warnings of the retail-channel shift and adapt their businesses to realize the new opportunities, the report states.
The channel shifting in the recession has had some obvious moves:
* Wal-Mart has been a winner; Target has not.
* Supermarkets and dollar stores are doing well; mall stores are not.
However, beyond the obvious, WSL said many of the shopper shifts open some immediate opportunities for retailers.Beyond that, the WSL "How America Shops PULSE" report, which compares the demographic shift in shoppers by retail channel from the second quarter 2009 vs. the same period 2008, offered these other observations:
* If your retail strategy has been very Wal-Mart-focused, it might be time to take another look at the supermarket channel.
* The obvious reason for the growth of supermarkets is the spending cuts shoppers have made in take-out food and eating out, which means more cooking at home with food purchased at the supermarket.
* 46 percent of shoppers stay out of stores where they are tempted to overspend. When you only need to buy food, the mass merchandiser has too much temptation.
* Dollar stores are in the right place at the right time --with more of the right brands. Over the last five years, dollar stores have moved well beyond their rural Southern roots to open stores in middle class neighborhoods around the country. More manufacturers are realizing the dollar-channel opportunity and selling them more national brands.
* Convenience stores and drug stores are increasing their share of shoppers, which may seem contrary to the frugal shopper mindset, but it makes sense. When shoppers don't stock up, they run out, the report states.
* C-store growth may seem like a contradiction in an era of price-conscious shoppers, but remember how shoppers are cutting back on groceries and not stocking up on sale items. That leads to running out. C-store prices may be higher, but if it's nearby and you save on gas and time, then the trade may be worth it.
* Drug stores are seeing their strongest lift among middle-aged, middle-income shoppers, who, as with c-stores, may need the drug store when they run out of something, or find it a better choice, where a trip to a mass merchandiser to save a few cents turns into overspending on so much more than what was on the list. (It's that temptation again.)
* Internet Shopping is up among the affluent, who are certain they find the best price online. From our last "Online Shopping PULSE" report in April 2008, we know that half of affluent shoppers feel they save money shopping online, and saving money is what they are looking to do more of now.
* Mass merchandisers have an increase in affluent shoppers. For the first time, the share of affluent shoppers in mass merchandisers equals that of lower- and middle-income groups.
* Warehouse Clubs have had a significant decline in younger shoppers who may have discovered that their smaller households were wasting much of what they thought they were saving by buying big club sizes.
* The mall has lost across the board -- men, women, young and old -- but with the biggest losses among middle-income families who just don't need all that temptation.A final note about male shoppers: Unemployment has taken a larger share of adult men than adult women out of the workforce, so it is not surprising that stay-at-home men are taking on more of the family shopping errands.
(Source: Convenience Store/Petroleum News, 08/10/09)
Tuesday, July 28, 2009
Speaking to consumers who are keeping their cars longer
Below is a recent article from AutoPacific that discusses how Americans are keeping their cars longer than ever before. I don't think that this is a surprising fact to anyone, but how do businesses that touch the auto industry take advantage of it? Here are a few ideas:
Americans Keeping Their Cars Longer
An annual survey of new vehicle buyers shows a significant increase in the number of people planning to hold on to their cars and trucks. In 2005, just over 46 percent of new car acquirers indicated they would not be shopping for a new vehicle for four years or more; in the just completed survey that number has risen to about 59 percent -- an increase of almost 13 percent. At the same time, the number of people intending to replace their vehicle within the next two years has fallen.
In April, automotive research firm AutoPacific conducted a national Internet survey which revealed that the general public was very hesitant to invest in a new vehicle; with 72 percent of those surveyed saying it would be more than a year before they would be in the market to buy a new car.
That finding supports other surveys which indicate that the public is wary about the current condition of the American automobile industry and the U.S. economy as a whole. It also confirms that not only are consumers wary, but those that did make the investment intend to hold on to their vehicles longer.
"Rapid replacers don't seem to be changing their pattern, but people who previously bought a new car every one or two years have significantly scaled back their purchasing, and those who before bought every three to four years are now waiting at least an additional year," said George Peterson, president of Tustin, California-based AutoPacific.
"We'll not be seeing the frequent replacement pattern brought about by strong incentives and financing programs that made it easy and financially reasonable over the last decade for consumers to get into a new car frequently. This may also tell us that consumers will be putting a higher priority on vehicles with a reputation for quality and durability that meets not only their short-term needs, but also their long-term expected needs."
(Source: AutoPacific, 07/14/09)
- Sell New Cars? - You better be talking about the long life and value!
- Sell Pre-Owned Cars? - Discuss value for the money vs. new.
- Do you do repair? - We extend the life of your car, no need for a car payment when we can get it back up and running for less than you would expect!
- Sell Auto Parts? - You are golden these days! Why get a new car when you have the parts to get going again, discuss how relatively easy it is to do most of the work yourself. If you have the knowledge to give the customer advice - shout it from the mountaintops!
The consumer knows what is going on in with the economy and the auto industry these days, so speak to them about things they care about. Have fun & go make some money!
Jeff
Americans Keeping Their Cars Longer
An annual survey of new vehicle buyers shows a significant increase in the number of people planning to hold on to their cars and trucks. In 2005, just over 46 percent of new car acquirers indicated they would not be shopping for a new vehicle for four years or more; in the just completed survey that number has risen to about 59 percent -- an increase of almost 13 percent. At the same time, the number of people intending to replace their vehicle within the next two years has fallen.
In April, automotive research firm AutoPacific conducted a national Internet survey which revealed that the general public was very hesitant to invest in a new vehicle; with 72 percent of those surveyed saying it would be more than a year before they would be in the market to buy a new car.
That finding supports other surveys which indicate that the public is wary about the current condition of the American automobile industry and the U.S. economy as a whole. It also confirms that not only are consumers wary, but those that did make the investment intend to hold on to their vehicles longer.
"Rapid replacers don't seem to be changing their pattern, but people who previously bought a new car every one or two years have significantly scaled back their purchasing, and those who before bought every three to four years are now waiting at least an additional year," said George Peterson, president of Tustin, California-based AutoPacific.
"We'll not be seeing the frequent replacement pattern brought about by strong incentives and financing programs that made it easy and financially reasonable over the last decade for consumers to get into a new car frequently. This may also tell us that consumers will be putting a higher priority on vehicles with a reputation for quality and durability that meets not only their short-term needs, but also their long-term expected needs."
(Source: AutoPacific, 07/14/09)
Friday, July 24, 2009
Do you have time suck?
Twitter? Facebook? YouTube? Blogs? Streaming? Video games?
Sure, we all need to keep up on digital, but not at the expense of getting our most important daily activities done. However, rarely will you or your team make much money letting the time bandit of Twitter or other internet temptations get in the way. Know what the top 3 important activities are for your business, then reinforce those activities regularly with your staff.
Sure, we all need to keep up on digital, but not at the expense of getting our most important daily activities done. However, rarely will you or your team make much money letting the time bandit of Twitter or other internet temptations get in the way. Know what the top 3 important activities are for your business, then reinforce those activities regularly with your staff.
Wednesday, July 15, 2009
The Number One Factor
Customers rely on their emotional experiences with salespeople more than any of the traditional factors, according to research by the Peppers & Rogers Group.
The research showed that:
* 60 percent of all customers stop dealing with a company because of indifference on the part of salespeople.
* 70 percent of customers leave a company because of poor service, which is usually attributed to a salesperson.
* 80 percent of defecting customers describe themselves as "satisfied" or "very satisfied" just before they leave.
* Customers who feel their salespeople are exceptional are 10 to 15 times more likely to remain loyal.
Source: Don Peppers, founding partner of the Peppers & Rogers Group (from The Selling Advantage, 07/28/09)
The research showed that:
* 60 percent of all customers stop dealing with a company because of indifference on the part of salespeople.
* 70 percent of customers leave a company because of poor service, which is usually attributed to a salesperson.
* 80 percent of defecting customers describe themselves as "satisfied" or "very satisfied" just before they leave.
* Customers who feel their salespeople are exceptional are 10 to 15 times more likely to remain loyal.
Source: Don Peppers, founding partner of the Peppers & Rogers Group (from The Selling Advantage, 07/28/09)
Tuesday, July 7, 2009
What Happens If You Cut Media Spending?
Predictive Modeling by ThinkVine Indicates One Brand Would Never Close Sales Gap
In the short term, marketers can get away with cutting media spending without much real harm. But that term is as short as a quarter, and the harm, once it begins, can last long after the media switch gets turned back on.
Those are recent findings of ThinkVine, a Cincinnati analytics firm that does predictive media modeling for marketers such as PepsiCo, MillerCoors and Colgate-Palmolive Co. ThinkVine CEO Damon Ragusa said lately he's been getting a lot of inquiries about the potential impact of going dark altogether for a quarter or more.
An analysis the firm did for one unnamed brand looked at the impact of turning off media entirely for a year, then turning it back on the next year at prior levels. For about 16 weeks, sales volume was about the same. By the end of year one, however, sales volume was about 20 percent lower without media than with it.
Turning media back on in year two reversed the sales decline as the brand began growing again at the same rate it would have otherwise. But it never closed the gap in sales results compared with what it would have achieved had it maintained media spending both years.
Different brands respond differently to media cuts, Mr. Ragusa said, and some brands with dominant positions or in less advertising-responsive categories may get away with cutting budgets unscathed. But for many, possibly most, getting back sales and share lost from cutting budgets can be a lengthy and expensive process.
"There is a downside risk," he said. "The cost of getting back what you lose is often greater than the savings."
A brand that is on a downward trajectory anyway because of the economy is much more at risk from a temporary withdrawal of media support than one with flat or rising sales growth, he added.
ThinkVine uses correlation and regression analysis and sales data. But it bases its predictions on the makeup of each brand's consumers, including detailed data on the media and spending habits of various consumer segments. It then crunches as many as a trillion data points for each forecast.
The results aren't perfect but tend to come within 2.4 percent of the real-world sales data in ThinkVine's validation work, Mr. Ragusa said.
(Source: Advertising Age, 06/29/09)
In the short term, marketers can get away with cutting media spending without much real harm. But that term is as short as a quarter, and the harm, once it begins, can last long after the media switch gets turned back on.
Those are recent findings of ThinkVine, a Cincinnati analytics firm that does predictive media modeling for marketers such as PepsiCo, MillerCoors and Colgate-Palmolive Co. ThinkVine CEO Damon Ragusa said lately he's been getting a lot of inquiries about the potential impact of going dark altogether for a quarter or more.
An analysis the firm did for one unnamed brand looked at the impact of turning off media entirely for a year, then turning it back on the next year at prior levels. For about 16 weeks, sales volume was about the same. By the end of year one, however, sales volume was about 20 percent lower without media than with it.
Turning media back on in year two reversed the sales decline as the brand began growing again at the same rate it would have otherwise. But it never closed the gap in sales results compared with what it would have achieved had it maintained media spending both years.
Different brands respond differently to media cuts, Mr. Ragusa said, and some brands with dominant positions or in less advertising-responsive categories may get away with cutting budgets unscathed. But for many, possibly most, getting back sales and share lost from cutting budgets can be a lengthy and expensive process.
"There is a downside risk," he said. "The cost of getting back what you lose is often greater than the savings."
A brand that is on a downward trajectory anyway because of the economy is much more at risk from a temporary withdrawal of media support than one with flat or rising sales growth, he added.
ThinkVine uses correlation and regression analysis and sales data. But it bases its predictions on the makeup of each brand's consumers, including detailed data on the media and spending habits of various consumer segments. It then crunches as many as a trillion data points for each forecast.
The results aren't perfect but tend to come within 2.4 percent of the real-world sales data in ThinkVine's validation work, Mr. Ragusa said.
(Source: Advertising Age, 06/29/09)
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