Does Freebie Marketing Work?

Freebie marketing tactics are used on a daily basis both in the online and offline environment. Freebie marketing involves the concept of giving away high quality information or a salable item for nothing in exchange for attracting new leads for your business. 

Whenever you make a purchase, visit a retail website online, perform a search for information, or visit your local brick and mortar business, more often than not you are introduced to a special offer or something which is being offered for free. Although everyone is aware of freebie marketing, many of those who are considering it to attract new leads or to build an opt-in list wonder whether or not freebie marketing really works and if it affects the purchase likelihood for prospects.

Do free gifts and offers affect purchase likelihood?

The answer to this depends upon how knowledgeable you are as a marketer when it comes to freebie marketing and the ways in which you present your offer.  When you think about, many of the major companies engage in freebie marketing.  For example, the social media sites offer free networking, Google offers a multitude of free products in addition to their free email account, Amazon offers free shipping in some instances, pet product companies add a package of free pet treats when you purchase one of their company products, you usually receive a bundle of free software when you purchase a PC, and the list goes on and on.

So, there must be some type of benefit of freebie marketing right?  Sure there is, and especially when it is done properly.

First, everyone likes to get more for their money and more so, everyone likes to get something of value for free.  This means that in order to succeed with freebie marketing, you must understand your targeted audience and some of the things they find valuable.  When you present a great offer or valuable information, this builds a trusting relationship between you and the client and increases your credibility which in turn, improves purchase likelihood in the future.

What are some of the benefits of freebie marketing?

Businesses use freebie marketing due to many benefits, each of which should occur in the following order:

Increase Brand Awareness:  Freebie marketing helps prospective customers to become aware of your brand and your product or service.  This is especially important if you are a startup business and are trying to generate a “buzz” about your product. Mugs with your brand name/logo are a great way of promoting your business by providing an item that could potentially be used on a daily basis in somewhere like the staff room for example. Check out Our IT Departments cheeky mug offer in the client area of their London website.

Enhance Your Brand and Credibility:  Freebie marketing is a great way to establish your credibility and continue to enhance your brand.  If you provide a valuable free gift, this demonstrates your commitment to quality as well as the level of your expertise regarding your product or service.

Increase Traffic:  If you use freebie marketing to generate traffic, this can take you a long way when it comes to word of mouth, especially on social media sites.  Just make sure that your freebie marketing campaign is designed to attract highly targeted customers that will remain loyal for a long time

Build Your List:  Although you may have a few customers that will make a purchase from you right away, the majority of your customers prefer to hang around and get to know your brand and what you are all about.  This is where freebie marketing can be especially useful since there is no out of pocket cost on the part of your prospects.

Generate a Profit:  Eventually and when used on a consistent basis, freebie marketing results in customer growth and retention and increased profits.  This is the last step in the marketing cycle when you are attracting customers with freebies.

If the last benefit is first on your list, you can guarantee that freebie marketing will not be successful because it demonstrates you are only interested in the sale.  Customers prefer to build trust in your brand and your product before they decide to purchase from you.

Is it possible to generate genuine leads by providing low budget gifts?

The answer to this is both a yes and a no.  If you sell a physical product which is preceded by a free physical product that is cheaply made and of little use to your potential customer, this will make it difficult to generate genuine leads.  It works the same way for a backend product.  If your customer purchases a physical product and then is offered a cheaply made backend product, chances are you will have problems with customer retention.

On the other hand, if you sell a physical product and you initially offer a free report or eBook on how to do something or some other type of valuable information related to your product, this improves your brand and credibility and instills confidence in the customer when they make a purchase from you.  Free reports, eBooks, or a video series do not cost much to create and can go a long way provided you offer valuable information.  For example, if you sell home improvement products and you offer free useful information on how to do something related to your product, this helps the customer to gauge your knowledge and credibility prior to making a purchase.

What is more effective, discount vouchers or free gifts?

The answer to this question depends upon what type of business you are promoting.  Is your business new or is it well-established?  Are you selling a service or are you selling a product?  These are a few of the aspects you must take into consideration before deciding on a discount voucher or free gift?

Some marketing experts will say that discount vouchers can easily deteriorate your brand, especially when you trying to build your credibility.  The same thing rings true for daily deals that attempt to get new customers through the door.  In most cases, unless you are a large well-established business, vouchers may send the wrong message to your customers that your product can be discounted and potentially leave them with the impression you may be overcharging.  It also attracts coupon clipping clientele which is looking for the cheapest deal and does not build loyalty.  In this case, there are better ways to build a loyal customer base using other traffic generation methods such as customer loyalty programs, community networking, and building customer testimonials which advocate for your products.

On the other hand, offering something for free which is valuable and relevant to your product or service can be more effective, especially when attracting new customers who will remain loyal after they make their first purchase from you. Again, it depends on your specific business.

What are the best type of gifts to offer? What gifts would attract the most interest?

The gifts that you offer must always be relevant to your products and the interests of your targeted audience.  This means the type of gift you offer, as well as the ones which would attract the most interest will depend upon the customers you are trying to attract.

For example, if you sell a particular type of face cream to reduce wrinkles, a free sample of the product or a relevant product such as a cleanser which makes your skin look younger would make a great free gift for others to sample.

Perhaps you are in the business of selling fine wines, a free wine tasting event which is well publicized would be an effective marketing tool for attracting loyal customers.

On the other hand, if you are in the business of selling a complete course on how to learn another language, a free eBook or report related to learning a second language may appeal to your target audience. Or, perhaps you offer valuable information on a particular topic to a membership group, a free report which offers just enough valuable free information as a teaser will be enough to attract and retain members.

If your business is online, there are hundreds of methods you can use to offer free information related to the topic of your business such as in the form of a mini course distributed as an auto responder series, an educational video series on your YouTube channel or website, an informative webinar, a social media event, or an audio interview which your customers can listen to at their convenience.

How can you track your return on investment?
How you track your return on investment (ROI) depends upon your specific type of business and the methods you choose to track the results of freebie marketing efforts.  Tracking the results of your marketing efforts is not as difficult as it used to be prior to the Internet however, it still requires consistency and an investment of your time.

There are literally hundreds of methods you can use to track the results of your marketing efforts, some of which include but are not limited to:

  • CRM Software:  Customer Relationship Management software has really stepped up to the plate in the last few years.  Not only can you easily manage back office tasks, but there are innovative tools included in most platforms for tracking the results of your marketing campaigns.  Many of the tasks are automated which makes it a real time saver while at the same time, keeping you on top of what is happening with your business.
  • Google Analytics:  If your businesses is primarily online or you have a brick and mortar business with a website, Google Analytics is a great tool for tracking your marketing campaigns.  There is a rather impressive array of tracking tools which can provide you with very specific details of website activity, marketing campaign results, customer activities, and much more.  And best of all, the analytics tool is completely free.
  • Social Media Tracking: If you network on social media sites, there is a broad range of tracking tools such as Google Alerts and Hootsuite.com, etc., on sites such as Facebook, Twitter, and others, which allow you to keep track of what is being said about your products and social media marketing campaigns.  Many of the tools are free and can be used right from your PC desktop.
  • Online Surveys:  You can enhance and track return on investment with reputable online survey sites such as Survey Monkey which provides you with a platform and an easy way to ask your prospective customers what they think.  This helps you to learn more about them and make improvements in the products or services you offer.
  • Promo Codes:  Whatever type of advertising you use, always include a unique promo code so you know exactly where the customer came from.  This helps you to accurately measure your marketing efforts so you can invest your time and money where it counts.

These are only a few of the methods you can use to track ROI.  If you research the topic online, you will find an unlimited number of tools which can help you to accurately monitor return on investment.

Why would you offer a branded gift?

When you are trying to establish your brand or create visibility for an ongoing brand, freebie marketing should always include your logo, a slogan which is associated with your brand, or any other unique identifier which people immediately recognize.  For example, what comes to mind when you immediately see the Nike swoosh?   The logo is then followed by a slogan which says “Just do it!” If Nike were to give away a free gift to attract more customers, you can bet that their logo and slogan would be included in the gift.

If you are a new business, this is extremely important since many recipients of your free gift may not remember where they got it, hence the reason for other identifiers such as a logo, slogan, website URL, watermark on a multimedia promotion, or other identifier which reminds the customer of the free gift source. And with social media, word of mouth and sharing spreads quickly, so branding your free gift is all that much more important.

Effective Giving: Should you purchase business data for distributing free gifts, or should you run an ‘opt-in’ gift opportunity on your website/social channels? What’s more effective?

In terms of purchasing business data for distributing free gifts, although there are some reputable sources, you never really know what you are getting or how old the leads are in the list.  Additionally, it is possible that the data is not targeted toward your specific product or service which means distributing free gifts can end up being a colossal waste of time.

This is not to say that there are no reputable sources for business data out there, however, with the high availability of free methods you can use to attract the right audience online, it may or may not make sense to purchase business data.

When you begin your marketing efforts, there are many free ways to research and find your target audience which costs much less than purchasing business data.  For example, getting involved with and finding your audience on social media sites is free. There are also a variety of free keyword tools which help you to determine what people are looking for when they search online.

If you are trying to establish your credibility, there are multiple free media sites such as Hub Pages, Ezine Articles, YouTube, Vimeo, and others which help you to establish your credibility and find your target audience plus, many other opportunities for finding the right customers who will be interested in your free gift.  Each site allows you to post a link back to your website which helps you to find highly targeted customers.

You can also opt to organize a webinar with a service such as GoTo Meeting or arrange a group presentation on a social media site.  Then offer a free gift to attendees when you send out your invitations.

All of these opportunities allow you to test the waters without huge upfront costs while increasing your leverage and your chances of finding the right audience.  They also prevent you from wasting time and money trying to find a reputable business data source that may or may not work when you use it for freebie marketing.

Erica is a marketing expert with over 15 experience in the industry. Erica is currently working with various small businesses across the UK and London, helping them to promote their products and service over Christmas time!

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Comments

  1. Janice  December 23, 2013

    I tried some freebie marketing for my company last year and too be honest, it wasn’t much as effective as I hoped. We sent our a load of decent quality pens to local businesses along with some literature, but in comparison to relationship marketing (email marketing, social etc…) we didn’t really get a return on investment. I would rather invest the money we spent on PPC to be honest, at least I can show a genuine ROI. Nice article by the way.

    reply
    • Smith Backer  December 23, 2013

      Hi Janice,

      Thanks for the reply. I agree at initial stage one may face no return of investment. But if it worked properly with complete plan then you will surely get some response not on the same day but slowly you will start seeing the results and people will keep on coming towards you as its not one time investment, it remains for years.
      While PPC will only work as long as you keep paying and running the campaign.

      Thanks

      reply

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