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Giving things away as incentives – mistakes to avoid

March 22, 2010

The art of giving something as an incentive to purchase is well known. A free calculator, loyalty cards, a pot of flowers… A pot of flowers!?

In the many years I have been involved in direct marketing, my mind drifts back at idle moments to the time we gave a potted plant away as an incentive to subscribe to a legal newsletter.

The argument went something like this: if you subscribe to Product X, you can do away with all the clutter caused by having to buy lots of different law reports from different sources. Result: space on your desk. Space for a nice, attractive potted plant…

OK, a sophisticated approach which went beyond a simple calculator, pen or mousemat. We thought it would work but in fact the offer was too complex. Although we got orders, the ROI on the offer was the lowest we had for that financial year. 

Worse, some people who subscribed then rang up asking them why we had sent them a plant.  Worse still, when it came to renewals on the newsletter, these were lower than average too. The promotion was unprofitable and those who subscribed were not loyal.

The lesson I learned from this is not to be too clever with your marketing. If you are giving things away as incentives (premiums), don’t let the incentive become the story (remember the Hoover free flights promotion anyone?). The key is that your product is the story. It solves a problem. It adds value. And, by the way, when you order it you also get something (e.g. the free pen).

A premium is a “by the way” gift. It is no more than that. It is a polite “thank you” for ordering. When it comes to renewing the product in a year’s time, your customers should be reflecting on how well the magazine/newsletter/book has worked for them. Not “ooh, that was the company that gave me that beautiful flowering cactus that died when I over-watered it”.

So, never forget, a product’s value is what sells a product. Nothing else. If you want to incentivise a purchase, by all means do so. But don’t make the incentive the story. You will regret it.

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