When it comes to launching any new retail product, branding, awareness, and education are essential for success. This is especially true for one of the most talked about, asked about, and misunderstood plant-based remedies in the marketplace: CBD.
The good news? Retailers may stimulate product interest, create brand loyalty, and improve overall sales by hosting in-store marketing, education, and demonstrations.
Non-traditional distribution
According to Joseph Caruso, founder and chief executive officer of Green Helix, the company discovered through data research that its key demographic—high-end, wellness-oriented consumers—shops at health food establishments, grocers, wellness shops, and spas. The list includes grocer Erewhon and fitness chain Equinox. Caruso said attracting brand loyalists required “boots on the ground” and a lot of in-store education.
“Part of what makes Green Helix special is our accessibility,” he said. He makes sure sales representatives develop good relationships with buyers and are available for in-store training and consumer education. “Our in-house demo team has done a fantastic job,” he said. “It’s a thrill when the consumer walks away pleased and then follows up with positive feedback.”
Green Helix’s partnership with Erewhon, especially, has been smooth and rewarding. “The reaction has been absolutely fantastic,” Caruso said. “We live by ‘you get out what you put in’; it’s all about accountability. We feel Erewhon is not just a [business-to-business] relationship, but more like extended family. We are regularly in their establishments with our branded demo tables, educating and just taking all the time necessary to interact with consumers and employees.”
Like Green Helix, Sera Labs sells to big retailers and grocery stores. The company’s CBD line includes topicals, capsules, gummies, and a pain crème, all formulated with premium hemp. Founder and Chief Executive Officer Nancy Duitch knows a thing or two about retail marketing. She’s spent more than twenty-five years in the consumer products industry representing large brands. She said the team she hired specializes in serving the mass retail space so Sera Labs could “go big right out of the gates.”
Launched in the summer of 2018, the company’s distribution deal with the American Asian Trade Organization for independent convenience stores gave the company access to the association’s 88,700 stores. Knowing many consumers who frequented such stores would be curious about CBD products but have very little real information or firsthand awareness, Duitch allocated a big budget to in-store marketing, or what she calls plus-advertising. “We will always send out brand ambassadors to train and educate,” she said. “I feel this plus-advertising is the key to success. We are building this company by gaining consumer trust through an educational process and bringing quality products to market with an unprecedented marketing campaign.”
In-store events
Coming from mainstream retail, where a premium is placed on demonstrations, sampling, and education, Duitch would like to see more managers implement in-store demos. “Educational materials and training are critical in this space, especially considering the legal [issues] and lack of any definitive compliance [regulations],” she said. “We have even commissioned a book, From Killer Weed to Miracle Molecule, [and we] offer multiple videos explaining how CBD is made that we bring on-site. We look the consumer in the eye and tell them the good, the bad, and the ugly, which gives a clearer understanding of the quality differences. Premium products through intelligent science is the key.”
Demos offer a unique opportunity to connect directly with the customer. The more connection, the higher the sales.
—Kirsten Osolind, senior vice president, Re:invention
After seeing an uptick in web traffic, social media engagement, and sales after the first few in-store demos, Duitch is parlaying her plus-advertising model to land even bigger accounts. The company plans to announce two big retail partners, one on the grocery side and the other in the home-care, wellness, and beauty sector.
According to Kirsten Osolind, senior vice president of marketing and public relations firm RE:INVENTION, CBD is an ideal product for in-store demos. “Demos offer a unique opportunity to connect directly with the customer,” she said. “The more connection, the higher the sales. But more importantly, in today’s economy consumers want to know what they’re getting. Whether it’s a dietary supplement, body lotion, or new beverage, demos and sampling are a way to gain consumer confidence and lower the perceived risk of trying something new.”
Although CBD sampling currently is prohibited by law in many places, market research firm Arbitron’s data suggests more than a third of customers who stop by a sampling demo table buy the product during the same shopping trip. Furthermore, according to a 2009 study, “Report on In-store Demo Effectiveness” by Knowledge Networks PDI, a store demo not only increased an item’s sales by a whopping 475 percent but also boosted sales for all products in the line by as much as 177 percent.
Shane Nance, co-CEO for MarketHub, a company specializing in mass-market retail sales, marketing, distribution, and brokering for the CBD industry, puts emphasis on brand representatives appearing in-store to educate and talk about their product. Nance trained a team of employees who have demoed an array of CBD products. “It’s very effective and needed for a new category,” he said. “The CBD sector is just now being considered for mass market distribution. It’s imperative that brands are able to make it to the stores to provide education for both store employees and customers.” MarketHub goes a step further: When they distribute to a retailer they brand the area with “HempHealthZone.com,” an educational website employees and consumers may utilize for information about CBD. “It’s like CBD 101,” Nance said.
Perry Abbenante, former senior global director of grocery and private label at Whole Foods, agrees with the approach but emphatically added in-store promotions are a “must-have” element of a successful brand in today’s world. “Without them, the brand will fail,” he said. “I tell clients they shouldn’t get into the trap of believing they’ll save money by avoiding the investment in retail promotions. You won’t save money. You will lose shelf placement.” He also said developing winning in-store promotions starts with a good relationship between the retail buyer and the marketing brand manager. “If you ask them what you can do to support them and their merchandising programs, you’re more likely to get more shoppers near your product,” he said.
Successful pairings
Grocery chain Erewhon has experienced significant success selling CBD. In addition to carrying Green Helix, the chain also stocks Honest Hemp, Irie, and Reed’s Remedies. According to Kaya Chyla, nutrition clerk at Erewhon in Calabasas, California, what initially separates the products is their branding and packaging. “Getting consumers’ attention with great labeling and packaging is very important,” she said. But, she added, what makes the sale and creates brand loyalty are regular in-store demos. “One of our top brands is effective because the owner comes in and demos consistently,” she said. “Demos are direct education for the customer. Trainings for the store staff also very much help the brands. If staff do not know about the products or what makes the brands unique, it’s hard to guide the customer to the right product.”
Chyla has participated in many training sessions and demos and said she has noticed consumers love to hear how the company was founded, where they source materials, and why their brand is different. “Stories are what help people connect to brands,” she said.
Chyla offers simple advice for store managers when it comes to selling CBD products: Have brand representatives provide more in-store appearances. “There is no better way to connect the customer to the brand,” she said. “It helps to build trust.”
Keys to Successful In-Store Demos
Educated ambassadors. According to Kirstin Everard, founder and president of Turn-Key Marketing & Promotions, the worst mistake is investing in a demo and not having the right people presenting the information. “If the people behind the table don’t make a positive impression, it can be counterproductive,” she said. “The consumer will just move on to the next brand.”
Know what can and cannot be said. “If you have a brand ambassador come in, make sure they know what not to answer,” Sera Labs CEO Nancy Duitch said. “There are lots of medical claims that cannot be made, and you don’t want to get in trouble with the [Federal Trade Commission] or [Food and Drug Administration]. I tell my people, ‘If you don’t know the answer, get it from a trusted source, and if you can’t find that, then don’t answer.’”
Be interactive. “It’s nice to have a tablet and a tri-fold leave-behind booklet,” Duitch said. “We even go a step further and do live chats on the spot through the Telegram app. This has been popular.”