Tons of money is spent every year on instore demos for CPG products. Customer feel more confident about buying your product if they try it out first, right? Because of this fact, many CPG brand builders are inadvertently led down an expensive and slippery path that can be counter-productive. Aside from price, quality, and appearance of their product itself, here’s are three big reasons why an in-store demo can work against your goals:
- You’re Only Working to Move Inventory
Retailers can views demos as a means of getting rid of your product inventory. You are helping them reduce their risk that your products will not sell and giving them a quicker turn on their investment. For them, it’s a no-brainer. In fact, it can get to the point where the retailer says, “ I won’t give you a display unless you commit to a demo.” Or worse, it can get to the point where your distributer’s representative actually says, “If you buy this product and put it on display, I will have the producer (that’s you!) come in and do a demo at your expense!) to get rid of it!” No thought of a permanent lift in sales here, just get rid of it! The rep makes their commission and is down the road!
- Your Representative Drops the Ball
You do a perfect demo. You have adequate inventory, you have adequate advance notice to promote and prepare, you have a personable, knowledgeable, and punctual representative, you have a great instore location, compelling signage, products for sale on the demo table. It’s on a payday, weekend, or other day with qualified traffic, and your product is a perfect price match for the neighborhood surrounding the retailer. You even have several conversions where folks who never bought your product are converted into buyers. But a fatal mistake is made! You or your representative, or your distributer’s representative, fail to ask for a reorder that is larger than past orders to create a larger footprint in the store and to service all the new customers you have created at the demo! When customers, who want your product come in, you are out of stock or worse, you are in stock but they can’t find you because you are lost on the shelf, they give up on you! They buy your competition instead…
- You Relied Totally on the Demo
You did not get a price reduction. You did not do outside demos in the neighborhood. In fact, you did not try to build your brand any place but in that one store. Because no folks from the neighborhood asked the decision maker in that store for your product by name, your demo had to stand on its own. Building a bricks and mortar brand is neighborhood by neighborhood. You don’t have to be national, statewide, or even citywide. You just have to get the customers that come into that store on a regular basis to ask for and purchase your product on a regular basis. They have to be familiar with your products. They have to have seen it at friends or better yet, at fundraisers where your product donation was visible. We used Worthy Cause Marketing to give the members of neighborhood nonprofits a social reason to buy our products.
If you don’t want sales to slow down after you leave the store, avoid these common mistakes. Go back and re-read #2 again about the “perfect” demo. And think about how you are either not making real ongoing conversions, not following up with another store visit within a week after the demo, or not gaining traction in the neighborhood. One surprising thing we found out in our business was this: a store that sold 10, 12-bottle cases a month of our products, did not have 100 customers that bought our products, not even 50, not even 25. They only have 10 to 12 who repeatedly and faithfully bought all that product! One new loyal customer can make a huge difference in the sales of your product after the demo. It’s manageable, it’s doable, but it requires some personalized attention.
There is only one reason for an expensive and time consuming demo, and that’s LIFT! Get lift, one new customer at a time and do everything else right (go back again and re-read #2!).
Who We Are
Michael Houlihan and Bonnie Harvey co-authored the New York Times bestselling business book, The Barefoot Spirit: How Hardship, Hustle, and Heart Built America’s #1 Wine Brand. The book has been selected as recommended reading in the CEO Library for CEO Forum, the C-Suite Book Club, and numerous university classes on business and entrepreneurship. It chronicles their humble beginnings from the laundry room of a rented Sonoma County farmhouse to the board room of E&J Gallo, who ultimately acquired their brand and engaged them as brand consultants. Barefoot is now the world’s largest wine brand.
Beginning with virtually no money and no wine industry experience, they employed innovative ideas to overcome obstacles, create new markets and forge strategic alliances. They pioneered Worthy Cause Marketing and performance-based compensation. They built an internationally bestselling brand and received their industry’s “Hot Brand” award for several consecutive years.
They offer their Guiding Principles for Success (GPS) & Shelf Smarts courses to help consumer product brand builders achieve success. Their book, The Entrepreneurial Culture: 23 Ways To Engage and Empower Your People, helps corporations maximize the value of their human resources.
Currently they travel the world leading workshops, trainings, & keynoting at business schools, corporations, conferences. They are regular media guests and contributors to international publications and professional journals. They are C-Suite Network Advisors & Contributing Editors. Visit their popular business site at www.thebarefootspirit.com.
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