GETTING THE MOST OUT OF SAMPLING

April, 2011

PMA Game Changer Conference

Lisa Bobb-Semple, Product Manager, U.S. Postal ServiceMarc McCrery, Manager, Specialty Services, U.S. Postal Service Larry Burns, President, Start SamplingMark Mitchell, Canoe Ventures

Who we are

Why Sampling Works and what’s new in sampling

A Case Study: Sample Showcase

Canoe Ventures: RFI and Sampling

Questions and Answers

Agenda

Helping PEOPLE connect with BRANDS… to turn TRYING into BUYING

Who We Are

Canoe is making TV the next great digital medium

Decade old marketing services company

Led the creation of on-line sample request solutions market

Creative force in the at-home sampling market

Manages the StartSampling network which can help brands reach nearly 200 million uniques/month

A self-supporting government enterprise, the U.S. Postal Service is the only delivery service that reaches every address in the nation.

With 32,000 retail locations and the most frequently visited website in the federal government, usps.com, the Postal Service has annual revenue of more than $67 billion and delivers nearly 40 % of the world’s mail.

The Postal Service has been named the Most Trusted Government Agency six consecutive years and the sixth Most Trusted Business in the nation by the Ponemon Institute.

Canoe VenturesTM is changing television. We're creating innovative products and services for networks to enhance programming and empower viewers to interact with their TVs.

We are accelerating TV's evolution by combining the impact and reach of traditional TV with new technologies and marketing solutions that will better connect consumers with brands.

Founded in 2008 by the country's leading cable operators, Canoe is making TV the next great digital medium.

Delivering the Future

Who we are

Why Sampling Works and what’s new in sampling

A Case Study: Sample Showcase

Canoe Ventures: RFI and Sampling

Questions and Answers

Agenda

Sampling is a Powerful Brand Building and Discovery Mechanism

92%

84%

75%

63%

Have purchased after trying a sample

Would consider changing brands if they like the sample

Became aware of a product through a sample

Were “very” or “extremely” likely to buy the product

after sampling

The case for product sampling is clear. It converts consumers to brand buyers.

Source: All about Sampling & Demonstrations, Art Averbook, Russ Brown and John Karolefski, PMA Promotion Marketing Association

Product Sampling reaches 70 million households each quarter.

In home (via the mail) In-Store Demonstrations Events and Venues: college campus, community

fairs, concerts, sports, and other “targeted” venues Non-traditional locations: Malls ,Movie Theatres,

Salons, Cruise ships, Fitness centers, etc On-Pack Catalog Package Insert / e-Commerce Ride Along On-line sample Request Integration with Retailers via Online Requests Newspaper & Magazine Pouch Door Hanger and/or Direct Delivery Integration within “Community” Media aka Social New Forms of Shared Marketing Platforms

In effect, if you can imagine it – there is a vendor to help you deliver that product experience ….

The popularity of sampling among consumers has led to an increasingly wide range of sampling opportunities

The Sampling Landscape

We all know people like samples and there is vast data to support this:– “92 percent of consumers find free samples the most influential source of information about

new products”.– Research shows that 80% of consumers prefer free samples to coupons.– 33% of consumers would be willing to pay for something they tried and liked.– 76% of consumers are making their purchase decision at home—more focus now on how to

reach consumers before they go in-store.

Samples are also playing a very important and sometimes overlooked role in the path to purchase. People not only enjoy samples - they also enjoy talking about them, hence…

Samples are a very effective conversation starter

Source: O'Leary, Noreen. "KFC's Grilled Chicken Tops Most-Recalled '09 Launches." Brandweek 50.44 (2009); Washington, Kelli, and Richard K. Miller. "CHAPTER 35: SAMPLING.“; Ad Age

Why Sampling Works …

Brands are utilizing social tools to offer people the chance to request samples (mailed “home”) and then join into conversations.

Facebook’s Sampling Engagement Ad can target specific demographic groups and brands are using these tools more and more.

A few examples - Chick-fil-A and Pepperidge Farm have engaged with people around sampling.

V-8 created attention for it’s V-Fusion + tea drink by giving away 1000 samples a week on Facebook. They continually ran out within hours.

Many other brands are increasing their use of social tools as a means to offer samples

Source: Quinton, Brian. “V-8 Fusion Opts for Facebook as Sampling Channel.” 22 Jul. 2010.PROMO. 28 Jul. 2010. <http://promomagazine.com/socialmedia/facebook/0722-v8-fusion-facebook-sampling/>.

“Community” (Social) Media

Broad Trend - Single execution … across multiple distribution channels

Full integration cross channels while combining both on and off line sampling

Leveraging social networking tools that can enhance the brands messaging in very creative ways while finding ways to deliver true ‘peer-to-peer’ sampling

Reaching people in new ways – e.g. RFI you’ll hear about from Canoe Ventures a bit later; across retailer web sites that directly influence purchasing

Creative sample packaging designs - extending brand presence directly via versions of brand shelf presence rendered at miniature scale

Surprise and delight placements- in unexpected venues that can break through clutter e.g. distribution at Post offices, entertainment venues, and the

I’ll cover much more @ PM WEBINAR: Converting Trying into Buying … Product Sampling circa 2011.  Next Tuesday 12th @ 2pm EST/1PM CST/12noon MST/11AM PST

Some of what’s new in sampling

Agenda

Who we are

Why Sampling Works and what’s new in sampling

A Case Study: Sample Showcase

Canoe Ventures: RFI and Sampling

Questions and Answers

Case Study: Sample Showcase

• Cost of sending samples via mail has become expensive.

• USPS looking for innovative ways to regain the market.

• Brands need lower postage cost to make ROI work.

• Researched what others Posts were doing• Interviewed prospective customers• Interviewed industry experts • Conducted customer focus groups

• Sample Showcase• Breaks through clutter• Cost effective

Case Study: Sample Showcase

Situation

What we did

Solution

The USPS, launched a new sampling vehicle called “Sample Showcase”. It is a nationally distributed, highly targeted, multiple-sample mailer intended to turn consumers into loyal brand buyers.

Introducing the “Sample Showcase”!

Sample Showcase

Branded; high-end materials

and participants

Sample Showcase

Branded; high-end materials

and participants

The box was designed to fit

in most mailboxes. and can be branded to

your company for any custom

release*

The box was designed to fit

in most mailboxes. and can be branded to

your company for any custom

release*

USPS Co-Branding

evokes trust and visibility

USPS Co-Branding

evokes trust and visibility

8 – 12 productstargeted

right to the CEO of the

home

8 – 12 productstargeted

right to the CEO of the

home

* Companies can create a customized mailing & timeline if all the spots are purchased. This includes co-branding the outer carton.

Box

A new sampling opportunity: A targeted sampling platform at an attractive price point

Dimensions: Box size: 12” x 5.0” x 1.5” Contents:

–Theme based –8-10 product samples –Product Samples and promotional materials

Branding: Branded and “Brought to you by The U.S. Postal Service”

Pricing: $0.30 – $0.50 per item per box

Audience

Sent to target list of consumers based on demographic and lifestyle profiles

Consumers can also opt-in to receive additional “Showcase Boxes“ if they qualify

Themes

include

HispanicsNew MoversBack to School

Sample Showcase: Details

Sample Showcase - Inside the box

Account Brand Product

6. J&J Splenda Splenda with Fiber

7. McCormick Grill Mates Montreal Steak

8. Nestle Nestle Coffee Strips

9. J&JShower to Shower

Sport and Shimmer Powder

10. P&G SecretClinical Strength Deodorant

11. J&J Bengay Moist Heat Pads

Account Brand Product

1. Hershey Reese’s Dark

2. Mars DoveSilky Chocolate / Peanut Butter

3. J&J Aveeno Body Wash

4. J&J AveenoHair Shampoo & Conditioner

5. J&J AveenoPositively Ageless Moisturizer

Illustrative

A selection of product samples were sent to 200,000 total households. The audience: a mixture of opt-in customers and targeted purchased lists (Pittsburgh and Raleigh).

Sample Showcase: Website

How likely would you be to purchase each of the following brands in the next 6 months?

Three rounds of survey questions are administered to customers. Questions include…..

Pre-Research e.g.

Box-ResearchWhat was your initial reaction when you received the Sample Showcase Box?

e.g.

Post-ResearchWhich of the following products have you purchased in the past 6 months

e.g.

Sample Showcase: Research

Results of Sample Showcase……….

What we learned

Three rounds of consumer surveys intended to understand the impact of the event on brands and the perception of recipients. Consumer participation in these surveys was exceptional and provided robust data for analysis.

Measure Results

Sample Showcase Research MeasurementMay 2010

Measurement*

Box Survey (An online consumer survey completed by recipients immediately after receipt of the Sample Showcase)

Consumer reaction to the Sample Showcase and its contents

N = 25,418

Product & Conversion Survey (An online consumer survey completed by consumers 6-8 weeks post-trial)

Post-trial brand awareness, lift, purchase intent, and word of mouth

N = 6,306

Pre-Sample Survey(An online consumer survey completed by recipients prior to receipt of the Sample Showcase)

Pre-trial brand awareness & prior purchase

N = 25,376

* 200,000 Sample Showcase recipients; 2010 release

What we learned: Sample Showcase Hits the Target

Nearly 12% of consumers logged on to give feedback on their Sample Showcase experience.

• The products were relevant to me 97.3%

• The mix of products inside appealed to me 98.4%

• I felt like I was opening a gift 95.8%

• I was very excited when I received Sample Showcase 95.9%

• Sample Showcase is a good fit with the USPS 92.5%

• The products were easy to use 96.2%

• Sample Showcase is for someone like me 97.3%

Q7 - Please rate your agreement with the following statements (five point agree / disagree scale*)

* Top 2-box on a five point scale, N=25, 418

• Based on all respondents answering this Product survey question• Q10 of the study• Base sizes vary by product

Nearly four in five (77%) respondents reported purchasing at least one product included in the Sample Showcase since receiving it.

What we learned: Purchase Since Sampling

• Based on all respondents answering this Pre-Survey and Product Survey question• Base sizes vary by product• Note: Pre-Survey respondents were only asked this question if they indicated awareness in Q4

Summary of Top-2-Box “Definitely/Probably Purchase” Responses

Nearly three-quarters (73%) of consumers expressed Top-2-Box average purchase intent. This represents an increase of twenty-two percentage points from the pre-sample survey.

What we learned: Future Purchase Intent

Q: Which one phrase best describes how likely you would be to purchase each of the products included in the Sample Showcase Box in the future?

What we learned

Sample Showcase compared favorably with traditional “offline” approaches along key targeting and delivery factors.

Initial Sample Showcases have averaged 26% purchase since

trial

Initial Sample Showcases have averaged 26% purchase since

trial

Limited tracking available; runs approximately 10% as industry

standard

Limited tracking available; runs approximately 10% as industry

standard

Targeting

Information

Efficiency

BrandMessage

Conversion*

BreakingThrough

SAMPLE SHOWCASEOTHER SAMPLING: In-Store, Event, etc

Combination of self-selection (online) & demographically

targeted lists

Neighborhood clusters; event or store demographics

Real-time, actionable consumer feedback (pre & post) and destination confirmation

Consumer response rate hovers at 3%, if executed; post-program

reports only

One item per household; no waste or duplication, the brand is in

control

Freebie mentality, consumers “take what they can get”

Uncluttered time @ home where it’s tried and used. Online

engagement enhances exposure

Unrequested while “running for the train, shopping, reading”

Multiple points of contact for more exposure; opt-in names can be

added to a brand database

One-time shot; difficult to reconnect or re-market to that

household

The result? A lower cost per converted consumer!

The result? A lower cost per converted consumer!

* Case study results for 2010 release

What’s next for Sample Showcase and The U.S. Postal Service…......

Continue with themed releases: Hispanic box, New Mover box, Back to School box

Engage retailers as a means to drive traffic to retail

Incorporate QR codes to increase customer engagement

Explore other sampling offerings to develop a portfolio:Samples at PO BoxRadiant sampling programs e.g. Saturate around a store or a market“Flat rate Sample Box”Detached address label with samples

Agenda

Who we are

Why Sampling Works and what’s new in sampling

A Case Study: Sample Showcase

Canoe Ventures: RFI and Sampling

Questions and Answers

Agenda

Who we are

Why Sampling Works and what’s new in sampling

A Case Study: Sample Showcase

Canoe Ventures: RFI and Sampling

Questions and Answers

USPS Contact for Samples: Marc McCrery marc.d.mccrery@usps.govOffice: (202) 268-2704

USPS Contact for Samples: Lisa Bobb-Semple lisa.n.bobb-semple@usps.govOffice: (202) 268-3391

Canoe Ventures:Mark MitchellMark.mitchell@canoe-ventures.comOffice: (212) 364-3643

Start Sampling:Larry Burnslburns@startsampling.comOffice: (630)-868-2003

Questions/Comments