/ E-Commerce

How To Effectively Use Free Samples In Your Business

Every day I get a few messages from friends and acquaintances asking for samples of CILTEP.

Everyone wants to try before they buy. And in theory it makes sense.

But we’ll never do it.

Why?

Selling a sample version of your product is like introducing a competitor into your own marketplace.

A sample is a smaller quantity of the product. It performs exactly the same as the normal offering.

ciltep-sample-pack

example — 9 CILTEP capsules found in this package

A sample is not to be confused with a demo. A demo is a trial where the full offering of the product is not realized.

tesla

example — riding around in a Tesla for a day isn’t the same as owning one

Generally people believe the flow for samples works something like this:

  1. Person receives a sample of the product.
  2. Person either likes the product or doesn’t like it.
  3. Person decides to purchase a larger size.

This flow is only effective when a business is able to eliminate friction between steps two and three.

The best example of this is the fast food hibachi style chicken that’s found at your local shopping mall. The worker hands out the free chicken on a toothpick, the msg hits your tastebuds and you either move into the line to purchase or you continue on your way.

It also helps that you’re probably already hungry if you’re browsing the food court and because they gave you something for free, you feel obligated to compensate them in some fashion.

This is when samples work. The user is able to instantly act on their judgement of the sample and determine whether they want to purchase a larger offering.

So when Roy went to the Transhuman Visions Conference in San Francisco, we gave away samples of CILTEP and also sold the product using the Shopify POS app on an iPad. No friction involved.

There has been serious demand for sample packs of CILTEP. We could make incredibly margin on the product if we added them to our product lineup. But there’s no way that we will ever add them for sale in our store.

Why you absolutely do not want to offer sample products in your own marketplace

Let’s say you offer three different versions of your product.

Package A — $40

Package B — $60

Sample Pack — $5

Immediately this does two very negative things:

  1. ) All of the attention is driven towards the outlier
  2. ) It makes Package A and Package B look more expensive and risky

Instead of considering and comparing the respective value and attributes of Package A and Package B, the attention is turned towards price.

You want to sell your products to them based on the value that they’ll receive from buying the product, not based on the price.

They’ll be asking themselves questions, “Do I really need to spend the $40 or can I just get by with the $5 sample?” This is amplified times 1,000,000 if the individual hasn’t had an experience with the product before. They’re almost always going to go with the sample pack because the option has the least amount of risk.

This will directly cut into the sales for your higher priced items and drive down revenue. So after moving the customer all of the way down your funnel to the point of buying, you’re limiting their value by providing a cheaper option.

Sure they may come back and buy the full version later, but wouldn’t you rather have them do that the first time?

In the example above, you’d need to sell eight sample packs to generate the same amount of revenue as Package A or twelve to match Package B.

After factoring in your customer acquisition costs, you’re missing out on a ton of additional revenue for your business!

Here’s what you need to remember:

Samples are good when the friction from judgement to decision to purchase is minimal.

Samples are bad when they compete with the products in your own marketplace.

They’re also very useful in creating a sense of obligation between the user and your business.

Free samples are not to be confused with free trials or demos that are commonly found in sales processes for bigger ticket items or SaaS products.

Notes:

I’ve also found that people who purchase a full version or place a large initial order are generally nicer, not insane and pleasant to deal with. They are people you’re thrilled to get on the phone with, help troubleshoot their issues and generally build some sort of relationship or friendship with. The noisy, make your hair turn gray customers are almost always those who provide the least value.

If you’re all in favor of free samples in a products business, please send a link over of a company doing an effective job at it!

A lot of supplement companies offer “free trials” and then re-bill your credit card until you call a 1-800 number and cancel it. I despise these companies.

benhebert

I make money online through websites and business consulting. Everyday I'm challenging myself to learn and do more.

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