Mott’s Fruity Rolls. Tide detergent pods. Art of Shaving razors.
These are just some of the surprises e-commerce shoppers have found when their packages arrived – tucked, for instance, inside the children’s pajamas from Zulily, the sheets from Bed Bath & Beyond, the men’s shirts from Brooks Brothers.
The retail world no longer guarantees face-to-face opportunities to pitch new products to consumers — a taste test in a supermarket aisle, an impulse-purchase display at the checkout counter — because shoppers no longer have to leave home to buy. So the in-package free sample has become a key marketing and customer-loyalty-building tool in online commerce because of its seemingly undeniable popularity.
“Who doesn’t like free? Especially when something has real value,” said Craig Kapilow, senior director of brand partnerships and integrated marketing at Rue La La, an invitation-only online shop offering short-lived deals on brand-name merchandise.
The answer: No one doesn’t like free, apparently, and that’s meant enormous success for a Philadelphia-area family-run business founded before e-commerce was a thing.
BrandShare, based in Berwyn, is believed to be the world’s first and largest media and e-commerce sampling company, providing 74 million “value-add product inserts” a month and expected to reach between $40 million and $50 million in revenue this year. Triple-digit growth since 2013 earned the company — created in 1984 by Dick Guyer and one of his nine children, Doug — a spot on the Inc. 5000 earlier this year.
E-commerce is projected to reach $700 billion in the United States by the end of 2017, and brand spending on product sampling is expected to total $34.12 billion this year, according to the Path to Purchase Institute in Chicago. The Guyer family’s decision to redirect its focus to the online shopping world seems genius.
“If we wouldn’t have made this change, we wouldn’t be where we are today,” said Doug Guyer, 55, president of the company of 54 employees, split mostly between Berwyn and New York City. BrandShare also has offices in Bentonville, Ark., and San Francisco, primarily to serve Walmart, one of its biggest retail partners, and in Chicago, home to a major brand whose products it samples, Wrigley’s.
Founded initially as International Direct Response, the company was proposing a new revenue stream — media inserts, such as credit-card offers — for catalog companies Dick Guyer, now 87 and retired in Florida, had served as a list broker. (List brokers help companies get their message to the right audience.) Son Doug graduated from Boston College in 1983 with a degree in marketing.
Then came the idea to expand beyond media inserts (paperwork, basically) to actual product samples. Their first job: placing 200,000 Tylenol packets, along with coupons for the pain reliever, in catalog orders from Cabela’s, Eddie Bauer, and Sportsman’s Guide.
Apparently, outdoors enthusiasts have a lot of pain. So pleased with the results was Johnson & Johnson that it upped the ante five months later to four million samples, Doug Guyer said. The company has “been a great partner ever since,” he added.
As retailing morphed, so did the Guyers’ business, renamed seven years ago as BrandShare. By the mid- to late 1990s, that meant media and product sampling in e-commerce orders.
BrandShare pays retailers a fee, the specifics of which Doug Guyer would not disclose, to get samples included in their outgoing packages. It makes money by charging brands a fee to get their products placed, and almost guaranteed notice.
“We’re going to put your product into a FedEx or UPS package that gets opened 100 percent of the time in a very positive environment,” Guyer said.
“It just has to be that perfect synergistic fit,” his sister Kathie Tuoni, chief operating officer, said of the product/retailer matches BrandShare makes.
The biggest opportunities are for fashion retailers, Tuoni said, whose customers are a receptive audience to the myriad beauty and skin-care products available for sampling. Mothers with young children are another prime sampling audience, she said. Hence the Mott’s Fruity Rolls and Legos that have gone in Zulily orders.
Another plus about moms and millennials, Tuoni said, is that they are huge social-media users inclined to gush about their free samples on Facebook and Instagram. Advertising gold.
“Zulily customers are excited to receive an extra surprise in their shipments, which we see from social feedback and engagement with the brands whose products and/or messaging is featured,” said Brian Doherty, head of Zulily’s integrated marketing.
Since Zulily started sampling with BrandShare in 2015, it has increased its volume of samples about 28 percent each year, Doherty said. They have included Teddy Soft Bakes, Back to Nature’s Macaroni and Cheese, Brookside Chocolates, Werther’s Original caramels, and Bic 4 Color Pens.
“It’s added value,” Doherty said.
Currently, BrandShare provides samples in 42 lifestyle categories, said Doug Guyer, who said its client retention rate is 93 percent year after year.
Rue La La customers have been treated to tea, skin-care products, and chocolate through BrandShare-enabled sampling, said Kapilow.
“Who’s not going to be excited about getting a good shrink-wrapped chocolate sample?” he said, noting that Rue La La is “always cognizant about consumer engagement. … Right now, there’s just so much noise in the digital space, it’s getting harder and harder to engage with customers.”
Kapilow lauded BrandShare for being “hyper-respectful when we say ‘no’ if something is not the right fit” and for being “great reaching out to brands we want.”
Ever-evolving, as the digital world demands, BrandShare has begun to offer retailers digital campaigns to provide consumers with interactive educational experiences about sampled products. For Rue La La, that includes a website tutorial on Burt’s Bees lip and skin products, Kapilow said. “It’s true consumer brand awareness.”
E-commerce grocery shopping is “great news for us,” Doug Guyer said, pulling out a Walmart tote bag stuffed with samples – including Tom’s of Maine Silly Strawberry children’s toothpaste, Prego tomato sauce, and V8 energy drinks. The bags are for 210,000 first-time Walmart online grocery customers.
Two other Guyer brothers work at BrandShare: Steven, as chief financial officer; and Michael, as vice president of operations. All but one of the Guyer children have worked at the company, which, a little more than two years ago, took on private-equity partner Aperion Capital Management in New York.
With all that momentum, there are still worries. A sample arriving broken, or, worse, causing damage to the ordered shirt or pants it accompanies. Or a retailer opting to bring in-house the work BrandShare does.
“That’s what keeps me up at night,” Doug Guyer said.
And it keeps Tuoni, a former teacher who used to run the catalog group at the old Franklin Mint museum and shop, focused on “getting that next big retail partner to work with us.”
There also are many more product samples to land. Although BrandShare now works with 2,000 brands, “there are another 20,000 brands that need to know about us,” Guyer said.
He acknowledged the irony of a company in the marketing business needing to be better known.
“Cobbler has no shoes sometimes,” Guyer said.