When you install micro markets you never want to just set them and forget them, right? But how do you stay on top of bringing in new products without breaking the bank or taking up valuable space in your warehouse to find out later that it wasn’t selling? Below are four proven ways to test new products in micro markets that are sure to drum up excitement, help boost sales, and benefit the overall consumer experience at your micro markets.
#1 Partner with Suppliers: Do you have suppliers who want you to test their new products in your micro markets? Well, here is an opportunity to partner with them and hopefully not take on all of the financial burden of buying product, warehousing it, and then it not selling. This is also a great opportunity to bring on entirely new suppliers and give them a shot at winning more of your business by helping you run the test program.
So, you picked a supplier, but now what? Once you have a supplier or two that you want to test new products with, consider the demographic that the product might appeal to. Think about the location types you have. For example, if the product you want to test is a salad that costs more than $5.00, consider putting it into high-tech, health conscious, or white-collar locations. However, if you are testing a new breakfast sandwich that is under $4.00, consider placing it into locations that are distribution centers, call centers, or more blue-collar type workers. Know your demographic and appeal to them appropriately with the right product mix.
#2 Communicate It… Proper Signage is Key: Your customers can’t know that you just released a new product into their market unless you tell them about it. Why do you think grocery stores or convenient stores have signage emphasizing a new product on an end-cap or merchandised with small signage next to it pointing it out? Because they want the consumer to not only know about the new product, but purchase it. Promotion is key!
So how do you promote it? Consider sending out a monthly or quarterly newsletter to your clients who can then forward it onto their employees. This is a great way to announce new and exciting products, promotions, or even events occurring in the market. Use signage in the market like shelf danglers to identify that an item is “NEW.” You can also advertise new products on a digital screen in the market, or within a consumer app. Not sure how you’ll come up with the time to create this material? If you don’t have an in-house marketing person, try partnering with your supplier to see how they can help execute some of these different tactics to promote their product in the test markets.
#3 Build on the Excitement and Hold Market Events with Product Demos: Ever wonder why you go into Costco and see product demos all the time? You see them because they work! I think I can safely say that we’ve all tried a product in the aisle and then purchased it! This is a tried and true sales tactic so why not try it in your markets? Plus, there are many additional benefits to holding product demos in conjunction with market events.
If you do a market refresh, meaning you re-merchandise the market each quarter or every six months, then you should consider holding an event around that time that also drums up excitement in the market. Do it in conjunction with a holiday, or hold a market customer appreciation event, or raffle off a prize sponsored by your supplier where you reward a loyal market user. Either way, create an event around the few hours you want to also hold a product demo. Ask your supplier to come in and setup a demo station. Test the product and get instant consumer feedback. By making this an event you are more likely to boost sales that same day in your market due to the activity and buzz it will create at the workplace. Don’t forget to follow these steps and promote it in advance to ensure people know about it.
#4 Analyze the Data: Data is your friend so let the results come from the data and make sure that you are leveraging the right technology to maximize each revenue gain or operational efficiency when it comes to merchandising in your micro markets.
Wondering where to begin when it comes to reviewing the data? Consider starting with just overall sales of the product for the given time period you were testing it for. Pull the data by total sales of the product, but then analyze the locations you ran the product at specifically because you may find that at certain locations it was a great selling item, but at others it was a low performer so understanding the differences of the location types is important to know where the product may be successful at in your entire network of locations versus not.
Next, evaluate the category sales and if that new test product performed well within its category. If it did, and is in the top 20% then you should probably consider expanding that product to other micro markets, if it is in the top 50% then consider just rolling it out slowly to other market locations to test further. The important note here is to ensure you gave the product enough time to test so that’s why we recommend running it for a quarter as a good benchmark of performance.
Testing new products in your micro markets can be fun, but it can also be time consuming if you don’t have a plan for managing it effectively. Think about how you bring product in and out of your vending machines. You remove low performing items to bring in new products, right? Consider that same approach and remember baby steps are the best way to achieve an effective long-term strategy.
Want to learn what the power of Seed Pro can do for your merchandising techniques? Curious how to layer on Seed Markets to manage your micro markets alongside your vending operations? Contact us today to learn more about our Seed platform and how it can help you manage both your vending and micro markets seamlessly.