How brands buy online copiers

Cure Hydration’s happy break came at a strange time.

Walmart, CVS, and the Whole Foods owned by Amazon began carrying the constructive fruit flavor hydration powder during the pandemic. Yet there were boxes and packets of electrolyte drinks in the back of the stores, while busy employees tried to replenish shelves with well-requested items such as hand cleaners and paper towels. His main sales manager – who offered free samples at sporting events such as triathlon or after class in fitness studios – has come to a standstill. Customers did not discover the brand when they shopped online or did not see it when they drove through the hallways traveling to the store.

Instead, Cure Hydration founder and CEO Lauren Picasso decided to try a different strategy to get her products in the shopping cart: free samples brought in Walmart’s takeaway orders.

“As an emerging brand, we wanted to find a way to reach out to customers, knowing that they are not browsing in stores as much as before,” she said.

She said the samples increase sales while costing less and being scaled more easily in about 1,000 stores.

Add sampling to the list of pandemic-related changes that may hold. As more groceries and deliveries are purchased at grocery stores, consumer packaging businesses need to experiment with new ways to get their products in front of people. Large retailers are trying to capitalize on the increase in demand by asking brands for access to their buyers and data they have collected about their preferences – while also delighting customers with free offers.

For years, companies with consumer packaging have paid retailers for the best real estate in stores that help them attract the buyer’s attention – like end caps, an exhibition of products at the end of the aisle. The comparison changed as more shoppers picked up their groceries in a store’s parking lot after ordering them online.

Online grocery sales in the US grew by 54% in 2020 and are expected to exceed $ 100 billion for the first time this year, according to eMarketer. The market research firm said the habits will survive the pandemic because the retailers see it as a more convenient way to buy, even after being vaccinated. By next year, eMarketer expects more than half of the U.S. population to be online grocery buyers. By 2023, online grocery sales are estimated to account for 11.2% of U.S. grocery sales.

Walmart’s US e-commerce sales grew 79% last financial year compared to the previous year, fueled by grocery orders, but have yet to make a profit.

Sampling is a money-making opportunity for Walmart. The retailer started a sample pick-up and drop-off program in 2014, but it is getting more attention as more customer traffic shifts to the parking lot. The retailer asks companies when their product is added to a porch or delivery order.

Walmart is looking for new revenue streams because it includes additional costs with online orders, such as taking grocery orders off the shelves and sending purchases to customers. At a recent investor meeting, Walmart CEO Doug McMillon said he wants to use his reach as the largest retailer in the world to grow other businesses, including advertising. He said it wants to make money from the information it gathers about buyers.

Even the big brands take notice. General Mills adjusted the number of samples he paid to place in pickup orders at retailers, including Walmart, Kroger and Target.

Jay Picconatto, brand experience director of commercial marketing at General Mills, said that sampling in the grocery bowl ‘is something we would not even touch two years ago or 18 months ago.’ While store traffic declined last year and retailers restricted in-store demos, he said the company was aggressively bending.

Some Walmart buyers, for example, received an example of Old El Paso taco seasoning with recipe cards around Cinco de Mayo. Walmart handed out its Annie’s Fruit Snacks and Bunny Grahams during a Walmart drive-in movie event.

“Then, we found, hear, it works and we actually like what’s happening,” he said. While shopping for more groceries at home, he said, “This is a place we want to keep playing.”

Alvis Washington, Walmart’s vice president of marketing, store design, innovation and experience, said the sample program could help connect brands with the right customers. Personalizing the samples a customer receives is an important goal.

It could also be used to deepen customer loyalty with Walmart, Washington said. It made some of its parking lots into a drive-in movie theater and a trick shop. In one store near its Arkansas headquarters, it held a special event for Mother’s Day. It illuminates the sky above several shops for a holiday drone program.

At each event, participants were surprised with a swap bag samples. Washington said the company wants to scale it into more of its Walmart and Sam’s Club stores. He described it as a ‘triple win’ – making Walmart a more attractive shopping destination, providing a fun activity for customers and creating an opportunity for suppliers “to put their new and innovative products in front of customers.”

He said Walmart would be able to charge an insertion fee for the weak bags, as with its business model for takeaway samples, and that companies should cover the cost of the products.

Walmart has also tested a welcome box for customers joining Walmart +, its subscription service it launched this fall. Each contains a Walmart + briefcase and product samples. He said the retailer is expanding the program and plans to adapt more to the customer’s preferences in the future.

Picasso said the new approaches to product discovery are easier and more cost-effective. On a good day, she said that a demo in the store handed out about 300 samples – which cost about 50 cents per sample, including the fee for booking space in a store and its crew. She said the cost of including a sample in a delivery order or a weak bag varies according to the retailer, but it usually varies between 10 cents and 30 cents per piece.

“It’s ultimately much more advantageous to get people’s hands in other ways,” she said.

Picasso said the company is again testing demo stations at several Whole Foods stores, with a pandemic twist. Each powder pack is packaged separately and people can pick up a stick of power and a bottled bottled water so they can try the product safely at home.

For other food and beverage products, however, she said the factor ‘ick’ could survive the pandemic, as the buyer is germ-conscious and does not want to eat a hacked granola bar.

Plus, she said, retailers are becoming more sophisticated, allowing companies to add samples to some delivery orders and not others, based on a customer’s purchase history – a more targeted approach than targeting the right strangers trust to cite an example.

General Mills will continue to pay for store exhibits, Picconatto said. But he said the pandemic has changed “how we think about the balance between in-store levers and online levers” – especially as e-commerce increases a higher percentage of its total sales.

“What we finally really care about is getting on that shopping list,” he said.