Can giving away freebies bring you more customers? The short answer is yes. Giveaway marketing is based on well-established psychological principles. Offering free products or services can provide numerous benefits to your business when your organization leverages freebies strategically. Let’s talk about why you should consider adding this to your strategies for growing your business.
Psychological Principles Behind Freebies
Giving away freebies is a popular marketing strategy because it’s effective. Learning the psychology behind freebies can help you understand why giveaway marketing works.
Businesses use freebies to benefit from the potential customer’s natural desire to reciprocate. Receiving freebies triggers, often subconsciously, the recipient’s sense of obligation to do something in return. Frequently, consumers buy the product as their way of reciprocating for getting a freebie.
- Standing Out in a Crowded Marketplace
When consumers have many options for a certain type of product or service, deciding what to choose can be overwhelming. Consumers look for a way to distinguish one product from the others. Offering a freebie makes your product or service stand out in a competitive marketplace.
- Trying Before Buying
Many consumers fear wasting money if they buy a new product and discover they don’t like it. However, potential customers are usually willing to sample a free product.
Benefits of Offering Freebies
- Lead Generation
Freebies are a great way to generate new leads. A popular method is to have website visitors provide contact information and agree to receive future emails from you in exchange for the freebie. Another method is to advertise that every first-time visitor to your brick and mortar location gets a free gift.
- Brand Awareness
You’re probably already familiar with increasing brand awareness with freebies. Many businesses give away hats, shirts, or bags that carry the company logo and name because the recipients become walking billboards for the brand. The swag you’re giving out should be appropriate for your audience and where you’re handing it out. For instance, branded pens may be perfect for a trade show, but customers at a farmers market could use branded reusable bags to carry their veggies home.
- Brand Loyalty
Customer loyalty programs encourage repeat business. Your customer gets a freebie after making a predetermined number of purchases. Many businesses still use physical loyalty cards (instead of a digital system) to track each customer’s number of purchases. One advantage of physical loyalty cards is they remind customers to return to your business every time the customer sees the loyalty card in his or her wallet.
Ways Your Business Can Leverage Freebies to Increase Revenue
Virtually every business can create a strategy to leverage freebies to bring in more revenue. Here are ideas to inspire a giveaway marketing campaign that makes sense for what you sell and your target audience.
- Offer the Right Freebie
Choose what you’re giving away carefully. It’s helpful to decide the goal of your marketing campaign before you select the freebie. For example, if you’re trying to build brand loyalty, offering a freebie after the customer’s fifth purchase is more effective than handing out branded fridge magnets. Also, it’s worth repeating that the free product or service needs to be relevant to your target demographic group and appropriate for the setting where it’s going to be distributed.
- Provide Limited Free One-On-One Coaching
Although there are several ways to put limits on free one-on-one coaching, a simple method is to provide a one hour trial with a free follow-up report. An hour of free coaching gives you and your customer enough time to discover if additional coaching would be mutually beneficial. Your free follow-up report includes insights from your meeting and explains how future (paid) coaching would benefit the customer.
- Present a Free Webinar
Your customers will probably be very receptive to an online webinar training that offers solutions to their major pain points. The key to a successful free webinar is giving away enough information to make it worth your audience’s time. However, you have to hold back enough to leave the participants wanting to pay for the solutions available through the product or special offer you present at the end.
In summary, using freebies is an excellent way to earn customers for your business. However, a free product or service has to be part of a well-developed marketing strategy to reach goals such as generating leads, building brand awareness, or promoting brand loyalty.