Transforming Sampling into Shopper Marketing: Walmart’s “Bright Ideas” Event Program

October 2009

The world’s largest retailer is hosting in-store events that present a “next generation” model for sampling and demonstrations by:

° assigning personnel to a specific store permanently, thereby facilitating strong ties with Walmart associates and trusting relationships with shoppers;

° executing events from a branded cart that is fast becoming a familiar aspect of the store environment and a shopping destination in its own right;

° emphasizing themed campaigns that offer lifestyle solutions addressing the unique needs of the Walmart shopper;

° coordinating the activity with Walmart’s other marketing and merchandising opportunities to help national brands create fully immersive campaigns.

Since fall 2008, Walmart has been undertaking an ambitious plan to re-engineer its stores in an effort to create an environment that its 140 million weekly shoppers will find easier and more pleasant to shop.

Known as “Project Impact,” the unprecedented transformation involves nearly every aspect of the store, from SKU counts, product assortments and category adjacencies to merchandising tactics, in-store communications and customer services. The underlying goals echo key tenets of Walmart’s corporate mission: to offer its customers lower prices, higher-quality goods and a better store experience.

Walmart’s plan comes during a seminal period in the marketing industry, a time when product manufacturers have embraced the store as an important venue for consumer marketing; retailers have leveraged their environments to build their own brands and strengthen their relationship with customers; and both parties are developing the skills needed to conduct “shopper marketing,” a dramatically different philosophy that requires a deep understanding of shopper needs and the development of collaborative, insights-driven marketing programs to satisfy them.

The company’s efforts to improve the shopping experience also entailed a re-evaluation of its in-store marketing practices to identify programs that would better resonate with customers — especially the “Moms” who account for more than 70% of the chain’s business. In short, the company wanted to reduce the number of in-store communication vehicles it utilizes while making the existing programs more meaningful. The resulting changes include the ongoing conversion of “Walmart TV” into the “Walmart Smart Network” and a de-emphasis on in-store radio messaging.

Among the more significant developments in this respect was the February 2009 launch of “Bright Ideas,” a weekly program that makes product sampling and demonstrations an integral part of the store experience. The program is managed by Shopper Events LLC, Bentonville, AR, a company formed last fall to serve as the official — and exclusive — planning and coordinating company for all of the retailer’s in-store events.

The Shopper Events operating model takes the promotional practice of sampling to a new level by assigning specific personnel to each store; utilizing a unique, branded sampling station that becomes a destination in its own right; and striving to deliver integrated, themed programs that provide shoppers with lifestyle solutions rather than simply handing them trial-size products.

By transforming the traditional tactic of in-store sampling — a product-focused activity, often with only short-term sales goals in mind — into a customer-centric strategy designed to drive sales while simultaneously improving the shopping experience, building customer loyalty and fostering brand affinity, the “Bright Ideas” concept could even be viewed as a prototypical example of “shopper marketing.”

“The in-store sampling experience at Walmart is absolutely best in class,” boasts Stephen Quinn, the retailer’s chief marketing officer. “We’ve renewed our dedication to our customers by providing them with a clean, friendly and consistent experience throughout all of our store formats.”

BRIGHT MARKETING

Sampling has long been one of the more widely used promotional tactics among consumer packaged goods manufacturers. Demonstrations are well known to be an effective means of introducing new products in consumer electronics, toys and a variety of other categories. Simply put, the easiest way to induce trial is to literally put the product into the consumer’s hand.

The immediate “day of” impact that a sampling/demonstration event can have on sales has been documented extensively. While there has been no definitive work as of yet, some academic research suggests that in-store events can also increase sales in the long-term. One recent study by Knowledge Networks/PDI identified substantial sales lifts as much as 20 weeks after the sampling event was conducted.1 Other studies have hinted at the potential effect of sampling on total-store sales and customer loyalty.2

A 2008 Arbitron survey3 of roughly 1,900 U.S. residents found that:

° 64% of consumers try the product after receiving a sample;

° 35% of those who try the product (22% of all consumers) buy the product on the day they receive the sample;

° 24% of those day-of purchasers buy the product in place of another one;

° 58% of consumers who sample the product plan to buy it in the future.

In the case of several retailers, sampling has become an integral part of the in-store experience, perhaps most notably at warehouse clubs Costco and Walmart’s own Sam’s Club. Formal programs also offer a point of differentiation from competitors. Supermarket chain Publix, for one, has leveraged an ongoing recipe program (in which the meals are cooked and sampled in stores) to not only influence purchase but also build customer loyalty.

A syndicated national consumer survey conducted by Simmons found that Walmart’s shoppers are 15% more likely than the average U.S. consumer to be influenced by sampling events (Walmart’s “Moms” are 16% more likely). Coupled with the fact that Walmart shoppers also are more likely to make impulse purchases (“buy things spur of the moment”), according to the study, that fact makes the prospect of conducting sampling events at the world’s largest retailer even more enticing.

BRIGHT PLANNING

But Walmart wasn’t looking to simply launch a formal calendar for sampling when it began searching for a new in-store event solution in early 2008. The retailer’s goal was to develop a program that could truly generate excitement among shoppers — to serve as another pillar of the “Project Impact” mission.

“We want everything that we do in-store to be relevant to the customer,” says Terry Nannie, who as senior director of marketing oversees the execution of both Bright Ideas and the Walmart Smart Network. “We needed to create a professional, on-brand strategy.”

Previously, Walmart had employed a roster of nine different in-store event companies, which made it impossible to create any kind of consistency from one event to another, or often even from store to store during the same event. While individual events were often successful — the sheer volume of traffic in stores would almost guarantee at least “day-of” success — they collectively did little to enhance the customer experience or further Walmart’s efforts to communicate more clearly with shoppers. (Until last year, the marketing department wasn’t even responsible for in-store events, which instead were managed by the business development group.)

After evaluating possible vendors and testing potential programs, Walmart decided in October 2008 to contract with Advantage Sales & Marketing, Irvine, CA, and CROSSMARK, Plano, TX. The two giants of sales and marketing services agreed to share executional responsibilities and co-manage Shopper Events.

The new partners had roughly 12 weeks to get the program up and running for Walmart’s targeted launch during Super Bowl weekend, Jan. 30 – Feb. 1. “We had 47 tasks associated with starting up the Shopper Events organization, and the process we used helped us compress a normal timeline to build a successful organization with speed and launch into 1,000 supercenters
that weekend,” explains Brian Pear, vice president and general manager of Shopper Events.

The program was added to 500 more supercenters in March and another 500 in April. (The stores were selected based on their overall performance, according to Nannie.) By the end of the summer, “Bright Ideas” had also launched in 27 Neighborhood Market supermarkets, four Marketside by Walmart stores and the two Hispanic-focused Supermercado de Walmart sites that opened in the spring.

Shopper Events now is conducting thousands of events each month via eight or more different weekly programs, and delivering an average 26.7 million customer interactions and 2.8 million samples per week. While not every Walmart shopper is exposed to the events, Pear estimates that 75 million per week could be, making the program’s reach stronger than nearly any other mass media option — probably with the one exception being a television ad during the Super Bowl.

BRIGHT CONCEPTS

The basic premise of the “Bright Ideas” program is relatively simple. Sampling/demo events are run every Thursday through Sunday from 11 a.m. until 4 p.m. The events are conducted at mobile, state-of-the-art carts that are equipped with refrigeration, microwave ovens and an ample surface area to maximize customer interactions.

Employing Walmart’s standard color palette and featuring the company’s spark logo to help them blend with the surroundings, the carts are branded with the “Bright Ideas” name. Three carts are deployed at each supercenter, two of which are designated for programs in grocery departments (dairy, deli, bakery, produce, general grocery, snacks, paper goods and cleaning supplies) and one for other areas of the store. The exact locations vary so that the events can be conducted as close to the sampled product’s shelf position as possible.

“Our experience has shown that there’s a very small window of opportunity to really capture the shopper’s attention. The traditional approach, with its fold-up tables, may attract her briefly, but she’s back on course in an instant,” says Tanya Domier, president of Advantage Sales & Marketing’s Marketing Services Division. “With a more interesting sampling station featuring collateral, P-O-P and — best of all — the merchandise itself, we’ve
effectively elongated the purchase-consideration time frame.”

Participating brands receive a 7.25 inch by 19.5 inch sign that attaches at eye level to one of the cart’s canopy poles. They also receive merchandising space on both sides of the cart’s front facing. That space — roughly the equivalent of a side stack, Pear estimates — offers an opportunity for immediate conversion.

Shopper Events charges a flat rate of $200 per store per day, which includes all labor costs, event-day signage, required sampling materials (napkins, cutlery, etc.), appliance rentals, and kitting/shipping fees. That makes the price of a program in all 2,000 supercenters a flat $400,000, or roughly the cost to air one prime-time TV ad. (Accompanying marketing collateral or premiums are optional, and come at an additional cost.)

BRIGHT DIFFERENCES

Beyond the basics, however, the “Bright Ideas” program creates a new blueprint for the sampling industry in a variety of ways. The most significant differences are:

The Staff.
The program’s “Event Specialists” were hired by Advantage Sales & Marketing and CROSSMARK specifically for this task. They all are food-safety certified, having undertaken 16 hours of advanced training before hitting the field. CROSSMARK president Joe Crafton jokes that “they could run a restaurant with the training they get.”

The specialists are notified about upcoming events two weeks in advance, and typically receive their training packets and instructions one week out. Although they are guided on how to present the product, “most of them don’t read from a script,” says Crafton. “We want them to be friendly, assertive, knowledgeable, and to make eye contact. At the same time, they are trained not to be overly aggressive.”

Permanently assigned to one store — and even selected to complement that location’s specific customer profile — these field reps serve as de facto employees, who not only can become intimately involved in their surroundings, but also can establish an ongoing relationship with shoppers.

“It’s the same people all the time,” says Nannie. “Our average customer is in the store five to six times per month, and they are starting to get to know these specialists. There’s a trust that’s developing there.”

Each store is assigned two specialists, one of whom acts as the “Team Lead.” Above them are 75 district managers responsible for overseeing operations at 20 to 35 stores, and eight regional managers who oversee roughly nine district managers each. (Not coincidentally, the structure mirrors Walmart’s own organizational chart.) Additional event specialists can be brought in when needed.

The Experience.
With the same faces manning the branded carts four days each week, the “Bright Ideas” program is fast becoming a natural part of Walmart’s shopping environment. Crafton notes that one store he’s familiar with has been leaving its cart in position all week long as a permanent, natural part of the scenery. (The formal plan is to store them in the backroom on off days.)

“Mom gets used to seeing the cart, and will even get to know the Event Specialist’s name,” says Pear. In that way, the Shopper Events employees become trusted advisors “as she looks for new ideas and solutions,” he says.

After six months of operation, customer satisfaction levels are very positive, according to Nannie, who believes “Bright Ideas” ultimately will help improve loyalty by becoming a reason for shoppers to choose Walmart over other retailers. “Our customers really like the experience,” he says.

“We’re seeing a lot of heavy traffic around those carts,” says Gina Thomas Allgaier, a member of the Walmart team for Kraft Foods, which recently concluded a summer-long event.

A ‘Solutions’ Focus.
While some past events may have involved straightforward product handouts, that tactic doesn’t quite fit with the program’s goal: to present Walmart shoppers with lifestyle solutions that help them “live better.” To that end, Shopper Events works with product marketers to develop promotional themes that are “solutions-based and, of course, value-driven,” to frame the events, explains Pear.

Shopper Events can help clients develop creative to be used in take-ones, brochures and other types of handouts that provide additional connection points and (at least potentially) send the brand message home with shoppers.

A personal favorite of Nannie’s is the take-one that explained how best to core a pineapple, along with tips on selection (a ripe one “shows no sign of green”) and storage. Distributed — big surprise — during a pineapple sampling event, the handout was designed to be a “keeper” that consumers would hold onto for future reference (thereby keeping Walmart’s name fresh in their minds).

“We want different suppliers working together — crock pots and food, for instance — so that we can offer solutions and not just samples,” says Nannie. (And, not insignificantly, so Walmart also can generate cross-category sales.) The more innovative the collaboration, the better, he suggests, citing one event in which Kraft promoted Jell-O sugar-free gelatin as a healthy snack option alongside Nintendo’s wildly popular Wii Fit videogame.

Themed “Get Fit with Walmart,” the program ran from June through August in eight supercenters each weekend. (The 100 total locations were selected for their high sales volume in both Jell-O and consumer electronics.) Video screens and Wii Fit pads were positioned on either side of the demo cart to let shoppers play games. Event specialists handed out six-page healthy living guides offering tips on dieting and exercise along with the samples.

“It created a lot of excitement in the stores” and, in addition to gaining strong trial, generated a sustained sales lift in the stores that executed early in the promotional window, says Kraft’s Allgaier. “Early indicators are that it was a success.”

For Earth Day in April, Frito-Lay handed out mini-versions of the fully compostable bags in which SunChips will be packaged beginning in 2010. An accompanying brochure explained the decomposition process.

Nannie advises, however, that the concepts “have to go along with our own strategic plan.” (Naturally, Kraft’s healthy initiative and Frito-Lay’s sustainability theme were right on point.) Walmart reserves the right to reject any proposal that conflicts with its own promotional calendar or distracts from its key messages. In fact, the EventTrack planning software developed specifically for Shopper Events can prevent many such potential problems: “It’ll keep you from sampling fried chicken wings during Women’s Health Week,” Crafton says.

Walmart also programs the “Bright Ideas” schedule with a number of its own vendor-supported events, such as the aforementioned Super Bowl effort and a “Joy of Ice Cream” program last spring. It also has been using “Bright Ideas” to introduce shoppers to a variety of private-label offerings, including events this spring to help relaunch the Great Value brand. “It offered a great opportunity to show how good the quality is,” Nannie says.

Also fitting well with the strategic plan has been a series of “split demos” pairing fresh produce with relevant packaged goods: lettuce and salad dressing, celery and peanut butter. “We’re taking brands from the center store out to the produce department” to the benefit of both, notes Domier.

The Drive for Integration.
Walmart doesn’t view “Bright Ideas” as an isolated program for product demonstrations, but as a key component of the integrated, collaborative campaigns with national brands that have been the retailer’s marketing directive for nearly two years now. The goal is to partner on programs that
cut across all consumer touchpoints inside the store (including the Smart Network and secondary merchandising), and out (such as circular placement and even mass-media advertising).

“This fits in with everything else that we’re trying to do,” explains Nannie. “We look at the products that will be demo’ed, and we find ways to integrate them — into the tab, with ads on Smart Network, and elsewhere.”

The process works in the opposite direction as well: Walmart evaluates the brands scheduled for other activity — like endcap space or Smart Network programming — to determine if they’d also benefit from a “Bright Ideas” program. “We’re assessing everything that comes in to see what would fit with the other opportunities we have,” Nannie says. “The merchants are very fond of this program.”

P&G’s Swiffer, as an example, utilized both “Bright Ideas” demos and Smart Network ads concurrently and saw very positive results, Nannie says. “The mix is pretty strong.”

“I think an integrated, 360-degree approach works very well at Walmart,” especially for launches or products that require some consumer education, says Allgaier. “The numbers that we’ve seen show a greater lift” when marketing vehicles are used in tandem, she says.

Starting the process of developing an integrated campaign is “as simple as making a phone call” either to Walmart or Shopper Events, Nannie says.

BRIGHT FUTURES

Of course, the aspect that most sets “Bright Ideas’ apart from other previous sampling programs is its venue: Walmart, the world’s largest retailer and, based on those weekly traffic counts, the world’s largest media opportunity, too. “You have the best of both worlds: reach and a direct, proven tactic for influencing behavior,” says Domier.

Nannie thinks that, ultimately, the program can expand beyond the grocery and household departments to encompass pets, toys, appliances and other parts of the store (although some areas would require additional staffing). He also believes that the concept can find a home in just about any store format that Walmart launches.

“We can reach out to customer groups that we haven’t been able to focus on before,” says Nannie, citing the Hispanic-flavored events taking place at the Supermercado de Walmart stores. “This program really has a chance to shine.”

BRIGHT RESULTS

Although sales figures vary by product category and program, the average day-of sales lift for “Bright Ideas” programs has been 123%.

Shopper Events understands, though, that measuring sustained sales lift is extremely important for proving that sampling can be more than just a short-term tactic. Using Walmart’s peerless Retail Link data-sharing system, Shopper Events analyzes sales trends up to four weeks post-event. Ultimately, it hopes to track sales up to 12 or even 16 weeks out, Pear says.

In-house analysts examine sales lift versus nonevent stores on the Wednesday after the program runs, and results can be shared with the client almost immediately. Four-week sales are later compared with that store’s sales in the four weeks prior to the event. The 650-odd supercenters that don’t carry the “Bright Ideas” program also come in handy for comparative purposes, Nannie points out.

Frito-Lay’s endless pipeline of new product introductions — for which awareness and trial are “pretty critical” — has led the PepsiCo division to already conduct a number of “Bright Ideas” programs, says Marissa Solis, the snack maker’s senior brand manager-Walmart Shopper Marketing. While results have varied, “we are seeing some longer-term lifts” from some of the programs, especially for brands with high established awareness, she says.

Shopper Events evaluates and amalgamates all results to build a library of knowledge that can be shared with clients. “We’re learning which products are most responsive, and which products work best together,” says Domier. “We can provide quite a lot of quantitative and qualitative data.”

Pear also firmly believes that the influence of “Bright Ideas” programs goes beyond the shoppers who physically take part. “Brand impressions certainly have an impact. Although it’s historically challenging to quantify event impressions, our sustained event-sales lift analysis is showing impressive results,” he says.

BRIGHT IDEAS AT A GLANCE

Days of operation: Thursday-Sunday
Hours of operation: 11 a.m. to 4 p.m.
Avg. event duration: two days
Avg. no. samples/demos: 700,000 (350 per store per day)
Avg. no. brand impressions: 3 million (1,500 per store per day)
Cost: $200 per store per day ($220 for two brands; $240 for three)
Minimum store count: None
Lead-time: Six to eight weeks (ideal)

SHOPPER EVENTS AT A GLANCE

Founded: Formed in October 2008 to launch and manage Walmart’s new “Bright Ideas” in-store event program.
Location: Rogers, AR
Phone number: 1-888-364-3033
URL: www.shopperevents.com
No. of employees: 28, two of whom are “embedded” fulltime at Walmart headquarters just a few minutes away in Bentonville. The personnel came primarily from marketing agencies, packaged goods companies (General manager Pear’s background includes work at Coca-Cola, Nestle, PepsiCo and Kimberly-Clark) and event management firms. “We wanted diverse backgrounds, because we didn’t just want to build another demo company,” Pear says.

Capabilities:
° Event planning and scheduling
° Inventory forecasting (based on an in-house algorithm)
° Collateral creative development, printing, kitting and shipping
° Premium soucing and distribution
° Integrated marketing coordination
° Event execution (exclusively via Advantage Sales & Marketing and CROSSMARK)

ABOUT ADVANTAGE SALES & MARKETING

Advantage Sales & Marketing LLC is one of the premier sales and marketing agencies in North America, with revenues approaching $1 billion and a roster of more than 1,200 clients that includes some of the most prominent Fortune 500 companies and brands in the packaged goods industry.

Formed in 1987, Advantage Sales & Marketing has specialized in outsourced sales, merchandising, category management and marketing services to manufacturers, suppliers and producers of food products and consumer packaged goods. The company works in a variety of trade channels including grocery, mass, convenience, drug, dollar, club, hardware and home centers, and has more than 20,000 associates in the U.S. and Canada.

Advantage Sales & Marketing launched its Marketing Services division a decade ago “after noticing several gaps in the traditional promotion agency model,” says division president Tanya Domier. “With no linkage to sales, traditional agencies operated in a vacuum, producing ideas that just weren’t executable in a store environment or within brand budgets. They lacked the knowledge and resources needed to tailor campaigns to customer priorities and tactical preferences.”

The company now operates a complete portfolio of marketing solutions through five business units: PromoPoint Marketing (account-specific campaigns), Integrated Marketing Services (full-service promotion), Marketration (events), TFI (health and wellness, diversity marketing and custom publishing) and Campaigners (event strategies and execution).

Having long understood that the store environment provides “one of the most relevant ways to connect with consumers,” Advantage Sales & Marketing has been preparing itself for the industry’s shift to shopper marketing by, among other initiatives, building up its tactical expertise through acquisition — after meticulously evaluating all available options to identify the ones that produce the best results for clients. “We’re very excited about using the in-store experience to bring the concept of shopper marketing to life,” says Domier.

Naturally, the company is also thrilled to be working with its new retail client. “Walmart had the foresight to see that an enhanced demo program could be an intrinsic part of improving the shopping experience,” says Domier. “We helped them recognize weaknesses in the existing model that, if fixed, would send a dramatically different message to shoppers — one that was far more consistent with who Walmart wanted to be.”

Shopper Events is “more than an execution company,” she says. “Instead of a third-party temp handing out free samples, you have a familiar face who can inspire you with ‘Bright Ideas.’ That sends a significantly different message to shoppers.”

ABOUT CROSSMARK

CROSSMARK has more than 100 years of experience as a sales, marketing and merchandising services company. Its global workforce of more than 20,000 employees includes nearly 13,000 in-store associates who make more than six million annual retail calls on behalf of such blue-chip clients as Frito-Lay, General Mills, Johnson & Johnson, Kimberly-Clark, L’Oreal, Nestle and Reckitt Benckiser.

The company has been working with Walmart on behalf of its packaged goods clients since 1962. In the 1980s, as the retailer first began to emerge as a major force in the industry, CROSSMARK began building a dedicated national project team to better serve clients’ growing businesses at the chain.

While witnessing the increasingly important role that in-store marketing has taken among its clients, and the corresponding shift of mass-marketing dollars into retail activity, CROSSMARK began to envision new opportunities beyond its traditional realm of sales and marketing services.

In 2006, the company acquired Marketing Solutions International (MSI) to use as a springboard for a stronger push into event services, explains president Joe Crafton. The plan was to use CROSSMARK’s national platform
and deep client relationships to help the small demo company grow.

The acquisition added another set of capabilities to CROSSMARK’s existing Retailer Solutions practice, which already included headquarter selling, category resets, private-label merchandising, data collection and field marketing. In spring 2009, strength in those areas led drugstore giant Walgreens to tap CROSSMARK as its preferred vendor for all in-store merchandising activity.

Soon after the MSI acquisition, CROSSMARK learned that Walmart was unhappy with its current demo activity and met with the retailer to understand how it could improve the program. The company even helped the chain begin testing new models. The allure of working with the world’s largest retailer made CROSSMARK willing to devote significant resources to Walmart’s review process — and even to join forces with rival Advantage Sales & Marketing to gain an edge in the review, Crafton says. (As a rule, Walmart doesn’t award service contracts to a single supplier.) “It made sense for us to normalize operations, as opposed to each of us having our own protocols,” he explains. “We both had a common goal: to win the account and bring Walmart’s vision to life.”

“We really think Walmart has enhanced the customer experience with this program,” says Crafton. “There aren’t a lot of messaging opportunities in the store today. We’re trying to give brand marketers a really great lever that they can pull — and, it’s 100 feet from the cash register.”

FOOTNOTES

1 “Sampling’s Long Tail Extends 20 Weeks Out,” an In-Store Marketing Institute analysis of research from Knowledge Networks/Promotion Decisions Inc., August 2009
2 Heilman, et al. “The Effect of In-Store Free Samples on Short- and Long-Term Purchasing Behavior.” June 2005
3 “Arbitron Product Sampling Study,” 2008

ABOUT THE IN-STORE MARKETING INSTITUTE

The In-Store Marketing Institute is a global organization of brand marketers, retailers, agencies and manufacturers focused on improving retail marketing strategy worldwide. The Institute serves the needs of its membership by providing information, research, education and training, networking opportunities, trade publications and a trade show designed to further the understanding, acceptance and effectiveness of in-store marketing. For more information, go to www.instoremarketer.org.

Shopper Events
903 N. 47th Street, Suite 201
Rogers, AR 72756
www.shopperevents.com
Ph: 1-888-364-3033

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