Product Sampling ROI & LTV Calculator

Sampling means giving people a small or free version of your product, like a trial pack or a single serving, hoping some go on to buy the full-size product. It's common for supplements and food, where people want to try a taste or texture before paying for a full tub.

Sampling ROI is what those full-size purchases earn, compared with what the samples cost. It has to count the whole customer, not just their first order: someone who buys a tub every month for a year is worth far more than one sale. That's where LTV, lifetime value, comes in. Here it means the total margin a customer brings in over all their orders.

converted customers        = samples sent × conversion rate
total sampling cost        = samples sent × cost per sample
cost per converted customer = total sampling cost ÷ converted customers
customer LTV               = margin per full-size order × orders per customer
sampling ROI               = (customer LTV × converted customers − total cost) ÷ total cost
break-even conversion rate = cost per sample ÷ customer LTV

• Samples sent: how many samples went out.
• Cost per sample: product, packaging, postage, and any ad cost to find the people, divided by samples sent.
• Conversion rate: the share of sampled people who later bought a full-size product.
• Margin per full-size order: what one order leaves after product cost and fees. Use margin, not revenue. The break-even ROAS calculator works it out as profit before ads.
• Orders per customer: the average number of full-size orders a converted customer places, counting the first.

A made-up supplement brand mails 1,000 trial packs. These are the example values in the calculator.

1. Total cost: 1,000 × $3.50 = $3,500.
2. Converted customers: 1,000 × 8% = 80.
3. Cost per converted customer: $3,500 ÷ 80 = $43.75.
4. Customer LTV: $12.00 margin × 2.5 orders = $30.00.
5. Sampling ROI: ($30.00 × 80 − $3,500) ÷ $3,500 = -31.4%.
6. Break-even conversion: $3.50 ÷ $30.00 = 11.7%.

At 8%, this campaign loses money: each customer costs $43.75 and is worth $30.00. It needs 11.7% of samples to convert, or a cheaper sample, or customers who reorder more. The calculator shows which lever moves it most.

Any rate above your break-even rate. That depends on two things only: what a sample costs and what a customer is worth. With a customer worth $30.00 in margin:

So a cheap sample sent to the right people can pay back at a low conversion rate, while an expensive kit needs a much higher one. Rates vary a lot by category, by how good a fit the product is, and by whether people asked for the sample or got it unasked. Use your own tracked rate, not a number from another brand.

• Using revenue instead of margin. A $30.00 order isn't worth $30.00. Product cost and fees come out first.
• Counting only the first order. For products people reorder, most of the value comes later. Counting one order can kill a campaign that works.
• Leaving out the cost of finding people. If you paid for ads to collect sample requests, that's part of the cost per sample.
• Not tracking conversions. Without a unique code or tagged link on the insert, you're guessing the conversion rate.
• Counting people who'd have bought anyway. Some sampled people were already going to buy. More on that below.

The conversion rate you track counts everyone who bought after a sample, including people who would have bought without it. What really matters is the extra buyers the samples caused. The cleanest way to find them: hold some requests back at random, send samples to the rest, and compare how many in each group buy.

It's the same idea as a holdout test for ads. The holdout test calculator shows how big a test needs to be, and the attribution gap calculator how far credited sales can be from caused sales. See how lift is calculated for the method.