The High Cost of Product Samples
During times of strong economic growth the often insidiousexpenditure associated with providing samples for customers gets overlooked. Across many industries the general policy of the early part of this century was to ship first and ask questions later. Entire internet communities sprung up to take advantage of these freebies and in many cases exploit the goodwill of stores that offered these niceties under the guise of potential future business. The end result is a growing list of online stores that no longer offer free samples because after careful analysis they realized it was a tremendous cost with little return.
An item such as the Quest Wheeled Cooler will run between twenty and thirty dollars depending on the distributor offering the product. The cooler is huge and will ship by what UPS calls dimensional weight. That means the cost of shipping will end up somewhere on the higher side of $30. Any vendor that ships this item without restriction would need to sell 7 to 10 of the same item just to break even on the one given away. Now repeat that by dozens of products a day and you get the picture the true cost of free samples is higher prices. A year ago online distributors advertised their very generous sample programs as a bullet point for doing business with them. As the recession deepened those policies have become much more restrictive. An increasing number now require a deposit that is credited to a future order within a set time frame. Otherwise the customer is charged for the item and shipping which seems very reasonable. A quick look at many of the top retailers this evening shows no evidence that those sample policies are still in place.
We talked recently about building custom promotional packages for success in a downturn. With the news now dominated by the spread of a potential pandemic consumers and businesses are rushing to find sanitation products. Bundling opportunities now exist in this area and the wise distributor would begin to combine inexpensive cleaning solutions with higher priced packages. As we highlighted earlier in safety goes mainstream in ad specialties there is a growing focus on product safety.