Consumer purchases are influenced by Product Placement, Sampling, and Word-of-Mouth

Consumer purchases are influenced by Product Placement, Sampling, and Word-of-Mouth Collectively and this varies by product category and consumer group.

Product Placement, Sampling, and Word-of-Mouth Collectively Influence Consumer Purchases

According to BIGresearch’s Simultaneous Media Survey (SIMM12), the effectiveness of product placements* varies by product category and consumer group. Consumers indicate product placements have the most influence on their grocery purchases with 14.8% saying so, up from 13.0% one year ago. Electronics and apparel round out the top three categories most influenced by product placements.

As marketers search for ways to increase marketing ROI, product placements are a viable option, says the report, particularly when targeting specific ethnic groups. African American, Hispanic and Asian consumers are more likely to be influenced to buy electronics, grocery and apparel from product placements*.

Influence of Product Placement On Purchases by Product Category & Ethnic Group (% of Respondents)

Source: BIGresearch, October 2008

Gary Drenik, President & CEO of BIGreserch, concludes “Though the use of product placements is growing… today’s savvy consumers… recognize when advertisers are trying to manipulate them… when executed effectively, product placements can… create highly influential word of mouth among specific consumer groups.”

45.8% of Caucasian, and 44.0% of Asian consumers, indicate their purchases are influenced by word of mouth**. 41.1% of African American consumers say the same when it comes to grocery. Dining out purchases appear to be most affected by word of mouth**.

Influence of Word of Mouth On Purchases by Product Category & Ethnic Group (% of Respondents)

Source: BIGresearch SIMM12, October 2008

And, while placement and word of mouth** impact future purchases, sampling*** can create an almost immediate impulse purchase. According to the Product Sampling Study by Arbitron, sampling successfully reaches 70 million consumers every quarter, and one-third of customers who try a sample will buy the sampled product in the same shopping trip, and 58% of those surveyed reported that they would buy the product again.

In the study, consumers were grouped into three categories:

• “Acquisitions” are those who were new to the sampled product
• “Conversions” are those who had heard of the product but had never bought it
• “Retentions” are those who had previously purchased the product

Consumer Purchases are Influenced by Key Factors

While 85% of the Retentions and 60% of the Conversions said they would purchase the sampled product in the future, sampled products encouraged 47% of the Acquisitions, those who had never heard of the product before, to purchase the product again.

Carol Edwards, Senior Vice President, Sales, Out-of-Home Media, says “… this study enforced that the sampling approach is both effective in making new customers aware of products, while also establishing a firmer identity with those consumers who have considered the product before.”

Highlights of the study:

• 28% of those surveyed reported that they have been offered product samples within the past three months
• 64% of those surveyed claimed they had accepted product samples. 66% of the customers characterized as Acquisitions accepted samples, as well as 63% of the Conversions, and 63% of the Retentions
• 35% of those surveyed claimed they purchased the sampled product on the same day. 26% of the Acquisitions bought the product right away, as well as 19% of the Conversions, and 31% of the Retentions
• 24% of those surveyed claimed that a sampled product had specifically replaced an item that they had planned on buying. 20% of the Acquisitions were planning to make the switch, as well as 33% of the Conversions, and 18% of the Retentions.

* Product placement, or embedded marketing, is a form of advertisement, where branded goods or services are placed in a context usually devoid of ads, such as movies, the story line of television shows, or news programs. The product placement is often not disclosed at the time that the good or service is featured. Product placement became common in the 1980s.

** Word of mouth is a reference to the passing of information from person to person. Originally the term referred specifically to oral communication (literally words from the mouth), but now includes any type of human communication, such as face to face, telephone, email, and text messaging.

*** Sampling isa method of encouraging product trial where consumers are offered samples, typically free-of-charge. See also:Accidental Sample, Convenience Sampling.
Source: Wikipedia & Jack Loechner