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March Madness In Ubers? Cargo Launches Major Sampling Program

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A few columns ago, I wrote about Cargo, the leading “in-rideshare” retailer and cited their understanding of the changing consumer environment, effective use of analytics and knowledge of the importance of strategic partnerships as reasons to expect them to have continued success. I ran out of space to focus on one other interesting aspect of their business model: sampling. After all, who would not want to get a free drink or snack while killing time during an Uber ride?  So it is with considerable interest that I learned of Cargo’s new sampling initiative in conjunction with the NCAA Basketball Tournament.

Starting this week thousands of Uber riders in Minneapolis, site of the NCAA Men’s Basketball Tournament will get free samples of limited edition snack boxes containing Bugles, Nature Valley products and Core Power protein shakes.

Cargo

Cargo is building on a promotion it ran in conjunction with its 2019 Super Bowl in Atlanta, which led to its best sales week to date. The way it works is that once the passenger is in the rideshare they are able to order free samples of Core Power® and snack boxes with Bugles and Nature Valley products via their smartphones from Cargo’s digital menu. The driver then gets notified and gives the items to the passenger when the vehicle is safely stopped.

I consulted Brittany Duff, Associate Professor of Advertising at the Sandage Department of Advertising at the University of Illinois and a leading expert on attention and emotion in advertising/promotion to get her take on the use of sampling in the rideshare setting. She believes that the setting is well suited to sampling, perhaps even more than sales, stating:

“I think that this is best for sampling. It's taking old ideas of relevance and receptivity and applying it to new delivery methods. If I am walking down the street and you try to hand me a  Core Power®, shake, I will probably be a little confused, may not have anywhere to immediately put it, and might ignore you because I am looking at my phone, etc. If I am a passenger in a car, I have the time and ability to look at the options, choose samples that I want, put it in my bag for later or begin eating/drinking it, etc."

In addition to the rideshare setting being well suited to sampling, a lot of the logic of the program goes back to the three key success factors I outlined in my earlier column. Here’s how Cargo is making it work:

1) Understanding the changing consumer environment

A good bit of Cargo’s success owes to how much time consumers spend in cars – the place where a typical U.S. consumer spends more time than anywhere but at home or at work.  So offering samples during rides is likely to highly appealing to riders. I asked Cargo CEO Jeff Cripe why he chose to run a promotion at the NCAA tournament. His response:

“Rideshare is becoming an increasingly important transportation method for large-scale events like this. Passenger transactions spike, drivers earn even more income, and brands distribute more products. An exciting campaign like this is also a great way to strengthen Cargo’s relationship with communities, particularly as our driver fleet grows."

Duff, a former Minneapolis resident, agrees that rolling sampling is smart and will build lots of excitement for people in town. She does express that Cargo will face some challenges in that,“The items that visiting people want will be different than locals just using it for everyday rides so there might be some items that should change out pretty quickly. Going along the lines of relevance and receptivity, event-relevant items (e.g. team-related items), and other items geared toward non-locals might be temporarily more important. It is Minneapolis in March so stocking caps or gloves could be good items to sell since people traveling there may not plan for cold weather.”

In essence, Cargo is capitalizing on consumer trends and on the excitement and associated attention around the NCAA tournament. And building up drive enthusiasm while they are at it. As discussed below, using data to manage logistics and product offerings is critical to the success of both sampling and product sales.

  • Making Effective Use of Analytics

CEO Cripe makes clear that Cargo makes analytics based on transactions available to its partners.  In response to why sampling is part of the company’s business model he states:

“Sampling is a win-win for rideshare passengers and brand partners. Brands can market or test new products with a hard-to-reach rideshare audience (many of whom are millennials) and gain valuable insights from those transactions in a specific time and place. We’re also able to track how those samples translate into increased sales from e-commerce promos and retargeting efforts, which is a true closed loop versus other sampling platforms."

Cargo

Without a doubt, the level of available analytics makes sampling programs more attractive to brand partners.  Moreover, Millennials are an audience that has proven harder to reach via traditional media, so it’s no surprise that brands place value on access to this group.

In general, effective use of analytics is key to Cargo’s success both with sampling and sales of regular products.  As observed by Professor Duff, “For purchased items, it might be a little more difficult to see it as big business, especially for shorter rides. But depending on the purpose, there do seem to be some possibilities- someone on the way to a meeting may want a quick burst of caffeine or breath mints. Drivers that do lots of airport runs might stock up staples that people tend to realize they forgot to pack only once they are on their way (e.g. toothbrush) but at cheaper prices than an airport kiosk.”

Clearly, keeping on top of what consumers want and/or are willing to pay for at specific times and places is central to Cargo’s success.

Capitalizing on Strategic Partnerships

As mentioned above, Cargo works with its partners both in terms of giving out the samples to an interested audience around the time of a major event.  It also shares data that can help determine the effectiveness of sampling and viability of a new product.  In essence, the sampling program can serve as test marketing. These promotions make sense for the partners too.  General Mills is headquartered in Minneapolis and, as such, it makes good sense to be involved.  Coca-Cola has a long association with the NCAA basketball tournament, and engaging with this type of promotion raises its profile within the numerous sponsors of the event.  Core Power®, produced by fairlife, LLC, partners with Coca-Cola on distribution and has been associated with the NCAA tournament for the past three years.  Its focus is on workout recovery and helping athletes build lean muscle, both which “fit” with the event.

These three aspects of their business model have set Cargo apart from others who have tried in-car retailing and are clearly contributing to growth.  Personally, I would really enjoy trying the samples.  Now if only Villanova can make the Final Four again so I can go to Minneapolis!

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