Jeff Lubel, founder of True Religion jeans, spoke to Fortune magazine recently about the lessons that he learned building his company. I thought that this particular lesson was important to emphasize:
Comp the sales staff.
I went to Fred Segal on Melrose and showed the jeans to a guy who was running the jeans bar. He hated them. I knew his boss, so I showed her the line, but she said, "I don't get it. I don't think my customer is going to get it." It took me an hour to wear her down, but she finally took 24 pairs. A month went by, and I went back, and they'd only sold two pairs. I asked the sales guy if I could give him a pair free. He and the other workers came out to my truck and I gave them the jeans. Four days later I went back and couldn't find my jeans. I asked where they were, and he said, "People would come in and ask, 'What are those that you're wearing? I want those.'" They sold out.
My students have been working with a specialty food company on a project for the past few months. We have heard the same thing from that company's president. In his case, it's not about being seen with the firm's product. By giving free product to employees at retailers, this specialty food company has created a force of knowledgeable ambassadors for their product. They understand the product - its flavors, ingredients, and the like - and can speak with customers about its distinctiveness. That store level conversation with customers proves priceless, and it's a far less expensive form of promotion than advertising, sales, and the like.