Companies that give away free products ( should you do it), The answer lies in risk and reward however we all have freebies so it must work
Count your free stuff and think about it
As I sit at my desk and look around I can see about six products given to me by suppliers.
There is the Real Estate Calendar, a Pen from a Tyre store, a Water Bottle from a Gym, a note pad from the local shire . In my top draw a host of Thumb drives and of course the ever present stress ball.
The list goes on with Golf balls, and equipment and probably a dozen caps with various logos.
On the fridge there are magnets from all over and Bottle openers on the cabinet, with the beer can holders all displaying a logo.
Therefore it is still happening however does it work?
You can never judge a return on investment
I have never had anyone wander in and say they want to buy something because I once gave them a free gift.
However I have used them as a referral item.
It is not just branding although that is close.
It is more a compulsion to return a favour or imagining you owe something in return.
I get regular note pads and calendars from local Real Estate agents. I am not in the market but they appear in my post box so I use them.
A while back I was selling a property and wanted a couple of quotes, for one I used the contact details on the note pad I was using at that time. Just might have earned him a big commission.
Go big or go small which is best?
This really depends on the occasion. Giving a fifty cent pen to everyone does not really cut it.
We all have a bundle of them so there is no perceived value.
The best items are the unique ones that make a statement.
The next best are those that will be in every day use.
Finally, those of a higher value that really come with an obligation.
Your aim is to get a bit of front of mind when decision time is close. Will they remember you and ( Know you) naturally (Like ) you now trust you as a reputable business. If you get this Know, like and trust going you will be a winner every time, it is the basics of marketing.
If you are selling a $50,000 car branded floor mats are always welcome however to entice a customer it might be a cocktail evening and test drive that gets them in.
The super Market chains make you buy your gifts. The recent miniature food containers at Coles required a certain level of spend and boy did it generate results. In one campaign a 5% increase in turnover for the group.
Companies that give away free products and show bags
The trade show bag is always a winner
I had an email this morning offering me collateral (probably the reason I am writing this) and one items was show bags at us$1.00 each however in a quantity of 5000 at a time. These were printed and delivered ex China.
However with a bag you need stuffers to fill them up. A great way to do this is use your supplier channel to come up with the goods.
Not just tradeshows.
We have a lot of success with inhouse trade meetings. You get a guest speaker a sausage sizzle and invite your VIP list for a special presentation.
Off course you make sure they leave with something to remember you by. A Showbag.
This can be a breakfast group , lunch or evening depending on your cliental.
Free stuff with complements
Or free stuff with complaints. Both of these have an image problem of buying a favour.
If you complain and get something for free it is often not near enough to compensate for the inconvenience and may be viewed as a bribe.
This was done at a restaurant recently when two meals in a group of six were considered cold. The waiter said no problem I won't charge for one of them. This was not what we wanted but set up a conversation at the table of should we have gotten both for free?
The reward was probably generous and needed not to have been offered however it was not seen as a good result.
Free stuff with compliments can be great when it accompanies an action by you. Perhaps you just bought a box of nails for your trade people, a good few dollars worth and a good sale. Enclosing a hammer as a freebee would really cement the deal.
Valued tickets to events
Your customers may queue up for these if they are good enough. For many years I sponsored the local Opera company and was given half a dozen tickets to every performance. We would invite different couple to join us on the evening to something many would not venture to.
This worked well in customer bonding.
A customer of mine had a box at the Local football for a once a year event. He shared the cost with a supplier and invited about 20 people to join the day. Believe me we all had our hands up for this one,
What collateral works the best
This really depends on who your customers are and where their interests lay.
People are different and have many interests that need to be satisfied. Footy tickets to a wife with thee kids, who barracks for an opposing team will not be seen as value. Nor the tea evening at the local baby shop for the man of the house. Ok I am not allowed to generalise like this any more but you get the point I am making.
The skill is finding the correct balance between price , perception and reward. A trinket may work as well as a high priced freebee.
After my free trial I would send the customer by courier a green box containing all the documents to sign a packet or two of jelly beans, a pen and a note pad.
Until this day I often see the green boxes in a customers office being used for storage. We had a set pp fee included in the price so the cost of collateral was more than covered.
The product was also a recurring billing situation that could go on for years and be well worth promoting.
Companies that give away free products and free trials
Giving away a free trial
This can have many benefits and is a favourite of mine. The trial is a soft close. It is generally a love / hate occasion that saves you a lot of the legwork.
I drove into a car sales late one afternoon. Grabbed a salesman and said I want to have a look at a new Ford Explorer. He handed me a set of keys and said take it home for the night, show the family, take them for a drive and we will talk tomorrow.
Gosh , I was sold at hello.
In another business we generally provide a two week trial. While it seems generous it gives us both time to work out what we want and saves any future problems.
This has gone on for years and interestingly only a handful of customers don't sign on after the two weeks.
A free trial needs to be seen as value and not just a shoe-in. Many SMS services, as an example, will set up an account with the first 10 messages free however then you pay.
A low cost and low return method.
The lolly give away that worked
The business had some bags of Jelly beans produced in small printed packages. They were personalised and given out to every new customer.
A result was that customers would continue to ask for them every time we had contact.
A fifty cent product that returned the value many times over.
A local Mechanical repair group have small packets of Tissues on the counter, these were branded and worth very little. However they were great to have in a glovebox for emergencies and I rarely failed to grab one when visiting.
The Battery retailer has a little torch, based on a AA cell and bright lamp. Branded and produced in China at a very small cost they are an excellent give-away. In this case however they rarely use the promotion that will stick with the customer and consider it a cost not an asset.
Furthermore In these matters the staff need to be fully involved to ensure a great result.
My giveaway conclusion
First of all the gift lingers in the mind for a long time. It is not about value or cost it really comes back to perception.
You all love something for free however it must come without strings and given with thought.
Certainly it will bond your customers for the long term which is the aim.
Does it work, off course it does however don't just be random really think about what you are doing and do it with Gusto. If you want to give stuff away then do it and to hell with the cost.
Finally other ways to promote your business