Free giveaways have been a marketing staple since the beginning of time. Businesses use them as a marketing ploy to attract new customers or maintain loyalty of existing ones.
A sample to try some wares, with the hopes of a large purchase later. You can just imagine an apple seller cutting of pieces of delicious apple flesh to give to passers-by, who, once they pop it in their mouth, are giving money hand over fist to purchase a full bag.
But are they still effective in 2022? Well, if NFTsare anything to go by, then yes.
Plain and simply put, yes, freebies are still considered an effective marketing tool. For starters, who doesn’t like complimentary things? No matter how big or small the item being offered is, it’s always a great tactic to lure new customers or retain existing ones to incentivize their loyalty.
Whether you’re a start-up or an already established company is irrelevant. Acknowledging the importance of a person’s custom is always appreciated. For instance, the online gambling sector is considered one of the most lucrative industries around in this day and age.
And what do operators within this niche do? Offer freebies of course! Casinos and affiliates are always advertising their latest and popular 50 free spins no deposit bonuses, match bonuses, exclusive bonuses, reward programs and the like! Why? Well, because they understand the value of rewarding players, and in turn, their promotions keep them coming back for more.
If you want to attract and retain customers, plus enjoy a greater customer lifetime value – one of the most important metrics in sales and marketing, then freebies can be another tool in your toolbelt to help you achieve these goals.
Types of freebies in 2022
There are plenty of different ways to offer freebies in 2022. The type that a business chooses to take should be carefully considered for its effectiveness in the industry. Here are some of the types of freebies to consider:
- Promotional products
- Free giveaways
- Freemium models
Another important factor is to cost out how much each freebie costs and how many sales will need to be made to cover the cost of the free products – if you want to recoup losses, that is. which brings us to another point…
What is the aim of your free giveaway?
Sometimes giveaways are more about testing the market, determining customer feedback, or trying out new features. Sometimes it is more of an investment into trying to develop the product or service further, rather than pushing (purely) for sales. If this is the case, you’ll want to have a clear vision in mind. Walking in blindly to free giveaways, without an aim in mind, is a good way to waste company funds.
Take a look at these aims to see if yours fits:
- To gain customer feedback about the product or service
- To test out a new version of the product or service before releasing to a wider audience
- To trial the product or service in new markets (e.g. regional or international)
- To entice a new or latent customer to buy your product or service
Doing the math
Free isn’t free – for the business, that is. To calculate whether freebies will be worth it for you in the long run, you’ll need to calculate the cost per customer, and then an estimated return on investment.
Return on investment may be immediate – buying a regular size shampoo bottle and getting a free mini in return you can see whether you come out on top, whether sales are boosted overall for the freebie period, and over the course of the next few periods, whether sales are up overall or go back to previous levels.
This, of course, will be different if you’re doing freebies to gain customer feedback or for testing purposes. In this case, you might compare the cost of the whole exercise by using focus groups through a third-party provider.
So, are freebies worth it for your business plan?
No matter your product or service, running a freebie exercise can be a useful endeavour. This all depends on your goals, funds, and what you anticipate for future sales. A free giveaway of a slice of cupcake in a supermarket might be a good way to get people to buy cupcakes that day. A two-for-one deal on laser skin resurfacing might bring new repeat clients to your aesthetic practice.
However, it’s always important to calculate how much the exercise will cost you to see whether it’s worth it – either in the short term or the long term. If it’s not worth it, you might want to look at other marketing ideas such as percentage off your services, referral and/or points systems for customers, competitions, or partnerships with other complementary businesses.