Using Freebies and Giveaways
as an Effective Small Business Marketing Strategy
Just about any business today can benefit by using freebies and giveaways to promote their business. Offering something for free to your prospects helps you to get a bunch of new customers quickly. Be aware of the pros and cons of this small business marketing strategy in order to use them effectively.
Here are three reasons why using freebies and giveaways work to grow your business:
Law of Reciprocity
Offering something to your prospects for free many time causes them to want to return the favor and purchase something from you. This is often referred to as the “Law of Reciprocity”. Have you ever received a gift in the mail from a charity looking to raise money for their group – maybe a package of greeting cards or a lapel pin or tee shirt? They know all about the law of reciprocity and that including inexpensive gifts when they are asking you to support them will increase the likelihood of your making a contribution.
Experiencing the Value
The second reason is that if you offer a free sample of your product or service, prospects get to experience the value of your offerings first hand, and there is a good chance they will continue after the free trial period is over. Consider AOL and the free trial CDs they mailed to everyone in order to get you to try their Internet access, or Columbia House and their music club where you could order 10 music CDs for a penny if you tried out their monthly CD club. Promotions like these worked incredibly well for these companies and chances are good that you can borrow ideas like this to use in your own business.
Now, before you consider using giveaways to grow your business, it is important that you know both how much a new customer is worth to you and how much it currently costs to get a new customer via traditional advertising methods.
For example, a new dental patient can be worth up to $9,000 or more over a lifetime to a dentist, so it makes sense to offer a free new patient exam and x-rays that cost you probably less than a hundred dollars with a high likelihood that they would turn into a longtime paying client.
Give Away Information
It is crucial for you to consider your marketing costs before engaging in an expensive giveaway. Even if you cannot afford something , almost everyone can afford to give away valuable information!
Information is perhaps the ultimate in freebies and giveaways. It has high perceived value, yet is inexpensive to produce and distribute to your prospects.
For example, produce an inexpensive free report, CD or DVD to help educate prospects and help them solve their problems while at the same time encouraging them to do business with you. If you are a web designer, produce a free report about the Ten Website Mistakes That Are Costing You Business and offer it for free on your website, or maybe send a postcard to your best prospects offering them a free copy of your new special report.
What if you sell home security systems? How about producing a guide or video about the 5 Mistakes to Avoid When Selecting A Home Security Company? Promote this on your website or in print advertisements. An added benefit to information products like this is you get your prospects contact information to email or mail them their free report which helps you build a list of qualified prospects in no time!
These examples here have given you some good ideas to take and use in your own marketing efforts. Pay close attention to this small business marketing strategy the next time you are reading the newspaper, watching TV, or surfing the web. Notice all kinds of products such as beds, reverse mortgages, and hot tubs sold using freebies and giveaways of some kind to help grow their business.
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