Free Marketing Ideas Part 20 – Promotions

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Welcome to the latest edition of my new weekly blog series, “Free Marketing Ideas”. Each week I will identify and explain a simple marketing idea that you can employ at low or no cost. Last week’s topic was Make Deals.

This Week’s Topic = Promotions

Pricing and Promotion are two of the 4 P’s of Marketing that are taught in most intro-level marketing classes. The others are Product and Placement.

The price that you set for your products or services is a tool that marketers can use to distinguish themselves from the competition, set customer expectations, affect demand, and control profits. And promotions are special offers that you make in order to drum up more business.

Most promotions don’t have to cost you anything in terms of real dollars. It takes time to dream up and implement them. If you’re offering discounts than there is a cost to you related to lower margins. But offering a promotion is a way to increase sales without spending a lot of money on advertising.

I could spend days listing all of the different kinds of promotions you can try, but let’s stick to a couple simple ones. The first are basic discounts, offering lower prices on one or more products for a limited time. The second is a free shipping offer, which is a very effective way to increase your conversion rates in an online sales environment.

The third is BOGO (buy one, get one free) which will have a similar impact on sales to a 50% off special. The fourth is a bulk sale discount, a discount on orders of a certain size aimed at increasing the value of each order.

A fifth is a free trial or free sample, that allows people to try your product or service before they buy it. You can also drive more sales with financing plans that require a lower up front cost, product add ons, the promise of discounts on future items, etc.

The marketing team should always be planning promotions that will boost sales and revenue at key points throughout the year. Creativity is a part of promotion planning. Some will work, others will fail. The key is to always be thinking, planning, and executing.

Share your thoughts on this idea, and other free marketing ideas in the comments section below and keep the conversation going!

Free Marketing Ideas Part 16 – Groupon and Living Social

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attraction marketing-101.gif

Welcome to the latest edition of my new weekly blog series, “Free Marketing Ideas”. Each week I will identify and explain a simple marketing idea that you can employ at low or no cost. Last week’s topic was Create a Loyalty Plan.

This Week’s Topic = Groupon and Living Social

If you have not heard of Groupon or Living Social by now I would be very surprised. But nevertheless, they are competing coupon services that partner with companies to create and publicize deep discounts. They have built up enormous email distribution lists of people who are looking for discounts from companies all over the world.

While the height of their popularity is likely already passed, many companies continue to use Groupon and Living Social successfully.

Getting started is simple, as long as you are willing and able to offer significant discounts. You can contact a sales person responsible for your area, they are usually geographical, and find out if there is interest on their end. As long as you are offering something that people want, and it’s not too expensive, there will be interest.

Then, you will work with them to customize the deal that your company will offer. It is common to discount your product or service by 50% or more.

The rest is up to them. They will write the copy, which you will approve. They will announce the offer to their lists. And they will manage the sales process.

Customers pay through Groupon or Living Social, and then they will pay you in increments. They will also take a percent of the sale for doing all the work and exposing your company to their customers. This is usually about 50%, but can be negotiated lower depending on the popularity of the offer.

And that’s all there is to it. It can be a great way to gain exposure for a product or service, and reach new customers that you cannot afford to reach with your own marketing. And the only cost is the share that Groupon or Living Social will keep as commission. But since it is just a percentage of the money that you are already making, there is no commitment on your part.

Share your thoughts on this idea, and other free marketing ideas in the comments section below and keep the conversation going!

Free Shipping vs. Discounts

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“For whatever reason, a free shipping offer that saves a customer $6.99 is more appealing to many than a discount that cuts the purchase price by $10.” – David Bell, Wharton School of Business

It’s true. Customers value free shipping. It’s a simple fact that every marketer must understand when we think about pricing and promotions.

What does it cost to ship your product?

Maybe your shipping cost is standard, maybe it varies based on the quantity of the order or the destination of the shipment. Regardless, there are several strategies that companies employ with regards to shipping costs.

You can charge the consumer what you are paying, the break even philosophy. You can charge the consumer more than it costs you, the profit philosophy. Or you can offer free shipping, no matter what.

Why offer free shipping?

Free shipping sells. It’s a tried and true selling point for products of all kinds. Many companies make a living out of promoting the ‘free shipping all day, every day’ line. But if that’s not for you, using free shipping as an incentive can be a very worthwhile effort.

Use your email marketing to generate a special promotion, free shipping today only, to drive a high volume of sales needed to meet forecasts.

Or use free shipping as a way to increase the value of each sale. Many ecommerce sites will promote “free shipping on orders over $xxx”. If the cut off is $100, someone who is making a $20 purchase may not be intrigued enough to spend another $80. But someone who has $70 or $80 of stuff in their carts are sure going to take notice.

Why not discounts?

Discounts can still work, but depending on what your shipping costs are, free shipping has been proven to work better. There is no real reason that marketers and business analysts point to when they try to explain why this is the case. It just is.

What if you don’t charge for shipping?

If you don’t charge for shipping, you’re ahead of the game. But why not promote it? Consumers who have never purchased from you before will take notice if they see “Free Shipping on all Orders, No Exceptions”. If you don’t charge for shipping and you’re not promoting it in as many places as possible, you are missing a huge opportunity.

I want to hear from you…why do you think ‘Free Shipping’ works so well as an offer?

Deals and Discounts for Marketers

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As marketers, we’re always on the lookout for the latest and greatest ways of getting our message out to the public. We spend so much time vetting vendors, analyzing numbers, building models, and writing material that sometimes we don’t spend enough time on ourselves.

Today’s post is a special one. Here are some special offers I’d like to pass on to you:

  1. I don’t hide the fact that I have a preference when it comes to email marketing services. iContact is inexpensive and reliable. I use it myself, and through this link you can get a free trial. Learn more.

  2. Another service I use is a simple press release tool that allows me to submit a release in its most basic form, and let the pros take care of the rest. For a low, onetime cost per release, it can’t be beat. Get 10% off your first release with PR Web here.

  3. When you spend so much time on your computer everyday, it’s important that you’re working with a machine you like. Amazon has some great deals on computers and computer gear going on right now. Check them out here.

  4. Ad Cause is a tool that allows you to use Twitter as an advertising channel. While I’ve never directly used them myself, they do come highly recommend by customers who’ve been able to use that network for marketing success. Check them out.

  5. Amazon’s list of best-selling books of 2011 is filled with business books that marketers of all kinds would be wise to look into. It’s amazing what you can learn from the trials and tribulations of those that came before us. Check them out here.

Two Bonus Items!!

  1. Next week I’ll be writing on the use of photography in marketing. If you want to get a head start on me, check out the discounts being offered on Digital Cameras over on Amazon.

  2. Calling all procrastinators! Tomorrow is April 15th and you haven’t filed your taxes yet. Need software?

The Modern Day Consumer and Discounts

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This blog was founded on the idea that the world has seen a shift in power from the company to the consumer. We’ve discussed how this shift was fueled by the internet, e-commerce, and social media, and how it continues to be influenced through the mass acceptance of online reviews, which now show up on almost every site.

The modern day consumer is in charge of commerce, and they know it. The majority of consumers, at least the ones who spend the most, know that they have all the power in the relationship they have with the companies they buy from. And they’ve started using this power more and more. Some business owners would say they’re abusing this power.

Discounts and sales used to be special occurrences. No more. Today’s consumers know where to look for discounts and sales when they want them. The smart ones won’t buy anything at full price. And as business owners and marketers, we’ve taken the bait. We offer more sales and more discounts than ever before, to satisfy the consumer need to pay less than full price.

Daily deals companies like Groupon and LivingSocial have capitalized on this trend, essentially forcing companies to deeply discount their products and services in order to sell to the mass markets. There are sites like RetailMeNot, where consumers share discount codes with one another.

And now, even if you do make a sale at full price, you have not cleared the discount hurdle. The availability of discount coupons online often make a customer who has already made a purchase call back and ask for a discount to be applied retroactively. And it’s getting tougher and tougher to have a strict refund or discount policy in customer service departments, because one wrong move can lead to a consumer with a lot of clout spreading a bad review around the web.

Companies are walking a fine line, feeling the pressure to satisfy each and every customer – even when the request is unreasonable – in order to avoid some future disaster.

Should companies fight back against this shift in power to consumers? Is there any way to do this in the digital age? These are questions I ask myself, and some that I would love to hear your thoughts on as well.