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Are Free Samples Retail’s Best Underused Tactic?
Insider and others have reported that free samples are making a return to the aisles of Costco and expanding into more supermarkets.
During the pandemic, Costco completely shut down its allocations of free samples but eventually resumed and served them prepackaged behind plexiglass. In the middle of 2021, around 170 out of the company’s estimated 550 locations brought back full pre-pandemic food samples.
Since free samples have been part of Costco’s successful allure for decades, it’s surprising that this strategy hasn’t been adopted more liberally by retailers. But it looks like that’s about to change.
The prevalence of samples has now reached a point where TikTok users have shared how they are able to make an entire meal out of Costco samples.
Additionally, alterations in the advertising market have provoked a rekindling of interest in samples among brands. Several brands have reported that paid online ads aren’t as effective as they used to be. This has led some to start distributing their products for free to potential customers, aiming to attract first-time buyers, according to Bloomberg.
Dude Wipes, for example, is not only using Freeosk dispensing machines in Sam’s Club locations to give away individually wrapped wipes — it’s also compensating people for handing out packs of wipes at Target. Brands like Oreo producer Mondelez International are also increasing their reliance on samples to “raise awareness about new and seasonal products,” Bloomberg noted. On the retail front, Walmart is expanding its free sample distribution to 1,000 locations, while supermarket operator Wakefern Food Corporation is installing free sample vending machines at 95 locations.
But do free samples really work? After all, Target has experimented over the years with free food and beauty product samples, but the vast majority of Target stores no longer offer any samples.
However, others have seen success with this tactic. After Snack Factory, the creator of Pretzel Crisps, started giving out samples, the company’s VP of marketing, Perry Abbenante, said that “the conversion rate of the sampling efforts was between 25 and 30%, meaning that at least a quarter of those who tried a free sample ended up buying the product,” according to Lightspeed.
From a psychological standpoint, samples serve up a sense of desire and reciprocity. Research has shown that giving out free samples can create a sense of loyalty, enhance the shopping experience, and stimulate hunger.
One last interesting development to note is how AI and technology are reshaping free samples. Allrecipes shared that Costco shoppers are starting to notice “the rollout of new self-service sample stations, which will likely replace the human-hosted kiosks.” Initially, this move hasn’t been to cut in-house costs since sample attendants are employed by a third-party company, Club Demonstration Services. Instead, the new technology may be a result of the labor shortage in the United States.
The new autonomous snack stations, resembling large storage vaults with openings on every side, seem designed for packaged snacks rather than fresh or hot foods. This style of dispensing may therefore offer fewer options for Costco customers.
There are also concerns that customers may not honor the “take one” policy displayed in clear instructions on these stand-alone stations. The prior system allowed customers to take as many samples as desired, but abuse was limited due to human monitoring. In contrast, these unmanned stations offer unregulated access, and some customers have already confessed plans to grab “handfuls” of samples.
Discussion Questions
Do you think free samples have a significant impact on customers’ shopping experiences? Should more companies be offering free samples of their products in some way, shape, or form? Why do you think free samples haven’t been as consistently successful at stores like Target?
Poll
Loading …BrainTrust
Ken Morris
Managing Partner Cambridge Retail Advisors
Carlos Arambula
VP of Marketing, FluidLogic
Free samples have been part of food retailing for decades, and there’s a good reason that brands and retailers are offering them again – it works. There is no substitute for actually tasting a product before you buy. The pervasive use of social media provides an extra pop that can be very helpful in getting people to try and ultimately become regular buyers. However, as noted, there are logistical challenges and costs with dispensing free samples and that creates barriers to using this strategy. Ultimately, brands and retailers need to decide if this marketing strategy is effective for their business, but from my perspective, this is an ‘oldy but a goody’ worth consideration.
Free samples work. It adds to the theater experience, creates engagement and, ultimately, customer intimacy. I’m not sold on the automated kiosk, though. I believe the banter is half the experience and to lose that would be like a cocktail party without people. That’s why I think live sampling, especially of food items, deserves a big comeback. It also deserves some fresh thinking. If I focus on grocery, I think grocers should be sampling their private label items more. Then look at the conversion data for private label vs. the brand competitor. There are probably new insights to be found there.
Sampling also offers the opportunity to steer traffic within stores. The sampling station can be placed far away from the shelf or refrigerator or freezer section where they’ll be told to find the item. Then, of course, the station can be placed in different locations for further testing. Grocers know that in-store traffic patterns and flow offer constant opportunities for improvement in merchandising. I’m sure they’ll see sampling as another way to boost their sales and get some impulse buys along the way.
Gimme Gimme. As always, the answer to whether free samples sways customer decisions depends on several variables. Food and beauty are popular categories for this practice–both of which categories work best when shared at a point of conversion/sale. Handing out samples off-site or at non retail locations have a softer attribution, but can be a piece of the marketing launch program.While automation is the future, I believe the human interaction needs to be considered. Who doesn’t like seeing a mini BBQ set up with fresh off the grill mini hotdogs being served? Yes, please.
Free samples are a great strategy for many reasons. For stores (like Costco) that promote owned brands, they give customers a chance to see for themselves if they’re giving up taste or quality by leaving the national brand. For new product introductions in food, it feels like offering a sample is almost table stakes to get exposure for their products. Finally, it makes the store a bit more fun to shop. It’s a differentiator that Amazon can’t match.
If it’s a good product, samples certainly can’t hurt. Samples also play a key role in elevating the overall retail experience- it’s good for both the brand being sampled and the retailer selling the product.
Free samples can be a great mechanism for answering questions and removing doubt about new or different product choices. Ken Morris makes a great point about grocers doing more sampling of their private label offerings. Head to head taste testing…!!! In the grocery store, when it’s private label versus national brand, what better way to prove to the shopper, at the moment of buying decision, that the private label is the superior value? If the grocer has been smart about the quality/value offering, it becomes an instant no-brainer, resulting in a long term switch to the private label.
In the absence of a taste test, and as an experiment, I recently bought a 12-pack of my grocers private label seltzer. $3.99 versus $5.99 for the branded 12-pack. I will now happily save $2.00 a week for the rest of my days. That’s on top of all the other private label offerings I take advantage of.
Who doesn’t love a free sample? When Costco pulls out the sample carts the atmosphere on the sales floor changes.
We connect through food. Shoppers get involved, talk about the product with the associate and other shoppers. Food sampling will always a great way to enhance the shopper experience.
Free samples elevate the in-store experience with multisensory product discovery and trial. Food samples are the tastiest retail media opportunity a brand can use to wow customers and drive sales.
CPG brands with distinct quality and innovation can win over customers by enticing them with free samples.
Despite successful private labels like Favorite Day, Target’s strategy prioritizes categories beyond grocery, which limits its use of free samples.
For some retailers, free samples are part of the shopping experience. It’s a great opportunity for the retailer to add to the customer’s experience and a win for the food manufacturer to get true exposure to an audience with money in their pockets/purses/wallets and is ready to buy that day. And while the customer may not buy that day, that doesn’t mean the next time the customer is in that store – or any store that sells that product – they won’t buy it.
Love free samples, both as a marketing tool and as a shopper. The question is, do they pay out – it’s a research question for a business. If I’m Costco though, maybe I don’t care – maybe I just accept that my customers love it (and my wife likewise makes a meal out of sample day), whether or not it pays out.
Free Samples? Where? Since Covid I have not seen any Food Free Samples in any grocery stores.
Last Saturday, the main aisle at Target One in Roseville, MN had sampling kiosks from front to back and people were definitely engaging. Looked like most products were Target’s house brands, as well.
Between COVID pullbacks and ongoing labor shortages, it’s no surprise we have seen less of this tactic – but it is nice to experience it again, as it does create more of a festival atmosphere & gets shoppers into a more receptive mindset even if they do not partake.
Samples are a GREAT way to engage with your customers. Trader Joe’s does a magnificent job at this, primarily because there is always someone there to discuss what it is you are tasting. Whole Foods does a miserable job with samples, because they put the sample out there for anyone to eat with no one monitoring it. Samples a a terrific, suggestive, way to sell items that you probably did not go in the store for, and I am surprised more retailers are not taking advantage of this tactic.
Taking the questions in order, free samples clearly work (just look at the BrainTrust enthusiasm for them). Sampling is effective, but not if everyone did it. Why not? Look at the congestion around a Costco sampling station and multiple it by 10, 20, or 30 more vendors. The store would quickly become unshoppable. As to why more stores don’t do it, I think that’s a question of flawed past execution, not the efficacy of the tool.
Indeed, free samples, can be highly successful in promoting and influencing purchase intent. In a prior company, I worked with one of the largest grocery retailers in Switzerland developing a series of mobile apps to support and augment dedicated, full time associates whose job it was to deliver a superior free tasting experience. The apps were designed to make associates more efficient with their admin tasks so they could spend more time creating delightful sampling experiences with shoppers. The apps also were designed to collect data, primarily shopper reaction/feedback, so that product marketing and innovation teams could understand issues and formulate tweaks to formulas, packaging, branding, etc. I’m not a fan of kiosk vending or some other robotic, sterile tasting solution. Sampling is experiential, and if associates are educated properly, they should be just as important and influential in the ‘selling’ process as the taste of the product item.
Sampling is a proven strategy across a number of retail formats and product categories. It’s an established lure within the wholesale club industry, as well as the grocery space. It is also a proven way to drive trial with consumers who are not familiar with your brand, your product, or a new version of an established product.
Free samples have a substantial impact on customers’ shopping experiences. They stimulate desire, enhance the shopping environment, and foster loyalty. The success stories of brands like Snack Factory, with a conversion rate of 25-30%, indicate that a considerable number of people who try free samples end up making a purchase. Moreover, the return of free samples to Costco and the expansion of this strategy to other retailers suggest that it remains a powerful tool for attracting and retaining customers.
Success stories of increased conversion rates for brands and the widespread adoption of this strategy by retailers suggest its ongoing significance in influencing consumer behavior. More companies should consider offering free samples as it can attract customers, and increase product awareness and conversion. Target inconsistency with free samples can be attributed to execution methods, product relevance, and demographic variations that may contribute to the effectiveness of the strategy.
Free samples have proven to be an effective in-store promotion if done correctly. Free samples MUST be accompanied by a coupon for the product. It is surprising how many times free samples do not come with a coupon.
Consumers like to be surprised and delighted. Sampling is one of the most effective ways to engage, involve, and influence purchases.
Free samples not for every product, they are for brands/products that require a risk on the part of consumers. One that is new or improved, or if a brand is trying to demonstrate its superiority to market leaders. No one wants to waste money on food they don’t like. It’s particularly effective for Costco for 2 reasons: 1) Consumers are generally purchasing large quantities of food and 2) It is a driver of growth for their private label brand. The number of people taking a risk on a large quantity of food, particularly when it’s private label, is going to be relatively small. Consumers may know what the branded version tastes like, but discovering that the private label version is as good or maybe even better by sampling is an instant win. Repeat that over and over and now Costco has customers who will automatically buy Kirkland because they have had consistent quality experiences with their products.
Free samples when integrated into a retailer’s overall strategy (think like a brand & act like a retailer) makes good sense. Sampling may give customers permission to bypass your competitors & visit your store.
The other concerns, previously noted, are all of the execution issues associated with free samples. Address these & integrate into your strategy & you have a potential winner.
Engaging consumers through sampling is a highly impactful approach to showcase the inherent benefits of a new product, essentially serving as the tangible proof of concept that influences their purchasing decisions. While certain products are naturally suited for traditional sampling, others can leverage experiential displays to captivate consumers and compel them to make a purchase. Regardless of the method employed, the overarching goal is to instill a sense of confidence and satisfaction in the consumer’s choice.
It’s important to note that this strategy is particularly potent in the realm of launching new products – and Club Stores are a great channel for new products. Once a product gains a foothold in the market and becomes established, more refined and efficient merchandising methods come into play. Retail giants like Target usually sell established products, trusted brands, or their extensions, employing merchandising strategies that align with the mature phase of a product’s lifecycle.
Whatever the value may be – and obviously that depends on how good a product you have – it’s clearly a strategy with limited potential; at least insofar as in store giveaways go…no store could suport such for even a faction of 1% of the products they carry.
Sampling has always been a great tool to lift sales, as tasting something is often the best tool to convince customers to purchase, and performance can be measured.
But there is a wide gap in the top line and bottom line performance of an open free-for-all sampling approach vs someone on staff who can actively teach customers about it, and help create a great experience at the dinner table. Passive sampling can often be an open money pit. Active teaching and tasting will always lift higher sales, but also create customer loyalty and drive better profitability. Food retailers must create a strategy to focus on items which will matter to their customers and make sure knowledgeable and friendly team members are driving this effort.
Free samples can be one of the most engaging forms of in-store experience but it doesn’t work the same for every category. By far, Food brands see a bigger impact than Beauty brands and OTC/Health has very limited options for in-store sampling.
Part of this has to do with mindset and barrier to entry. A decision to try a $3 snack item after a free sample can be made on the spot but the decision to try a $30 beauty product may require further consideration… even if the consumer liked the sample.
For some categories like beauty, its still good to have samples to-go, so consumers can try at home with due consideration. However, for food, it’s an easy win to sample in-store and drive on the spot conversion.
For retailers that have a significant food/grocery business, in-store sampling can be a key driver for additional revenue. Sampling is still valuable for non-food/grocery retailers as well but the conversion timelines may be a bit longer.
Samples are underutilized, in part because the cost of in-store staffing is prohibitive. New technology companies are integrating samples into the online process to create loyalty. Walmart is doing this very effectively, selling sampling programs to brands targeting specific orders and shoppers. SoPost is a company offering sampling as part of advertising and online programs (with Macy’s fragrance for example) showing remarkable increases in advertising conversion. Outform has a cool staff-less, sampling vending machine for in-store exchanging a sample for customer information via QR code. Expect more innovation here to address the costs of sampling delivery to make these programs more cost effective and widespread.
Offering samples is another way for retailers to create an engaging experience for customers, which helps build loyalty and leads to conversion. A prime example of where samples are used successfully is Duty-Free shops in airports where the experience is refined and well-executed. Providing samples increases the likelihood of purchase because it allows consumers to familiarize themselves with the product before committing to a larger spend. Samples also introduce consumers to a purchasing pattern that is outside the norm – one that is usually associated with a positive experience overall. Retailers that offer samples also tend to experience increased word-of-mouth marketing, which can help drive purchases outside of the retailer’s original environment. Despite the benefits of offering samples, sometimes this strategy falls flat. This occurs when the cost associated with sampling outweighs the ROI generated. For example, it’s expensive to create sample sizes of products, maintain the frequency of availability, and staff the locations where samples are available. In addition, not all store locations are set up for success, especially those with low foot traffic or those with challenging store layouts.