Free Association


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I’m no different from all marketers preceding me, who have long understood the power of free—samples, for instance. Something-for-nothing attracts attention, allows sampling of products and services, and ideally primes the pump for future transactions. For instance, an Arbitron study of retail shoppers found that 35% of those who sampled products purchased the product on the same shopping trip, Of that 35%, 26% had never heard of the product (the Acquisition group),19% knew of but had never bought the product (the Conversion group), and 31% had bought the product before (the Retention group). The study also showed that 58% of samplers indicated that they would buy the product again (47% of Acquisitions, 60% of Conversions, 85% of Retentions).

Yet, marketing with freebies presents communication challenges, in that the word “free” can have its negative connotations—from the derisive (“You get what you pay for”) to the cynical (“There’s no such thing as a free lunch”).

But there is such a thing as a free lunch—and a breakfast and a dessert, in the case of three recent notable instances of free marketing within the loyalty space. Here the connotations related to “free” are quite positive. These instances include Panera Bread’s new MyPanera program, with perks including “surprise gifts and special offers, like an unexpected free lunch,” as well as product samples. This is similar to the Godiva Chocolate Rewards Club, which offers a free chocolate each month to members who visit store locations. Then there’s the Denny’s free breakfast promotion advertised during the Super Bowl.

Based on these initiatives and on other programs that base part of their marketing on gratuities, allow me to suggest some elements of employing “free speech” in your initiatives:

Project the future. When using “free” as an acquisition tool, get ready to one-up yourself. “If I get deals like this just for standing around,” the customer thinks, “what will I get as a customer? ” Your gift or sample can’t look simply like a one-time enticement. It must both imply and state overtly the long-term value proposition that the offer represents. That’s an advantage of the Denny’s offer, designed to encourage not only visits but also Denny’s Rewards program signups. More than a free meal, it’s a potential entry into a world of news and offers on eats.

Don’t over-rely on the word “free.” It’s a powerful word, but loyalty marketing on the long-term employs even more powerful words and concepts, such as “recognition” and “celebration.” When it comes to communications, “free” is a gift, while “reward” is appreciation and earned recognition. Reflect that difference both in your offers and in the specific wording in communications to the appropriate target—Acquisitions versus Retentions, for instance.

Stock the toolbox with more than just free. This, again, is as much a matter of wording as it is the range of your value proposition. Apply the word “free” almost exclusively to products and occasionally services. When the member is within the program, apply variations of the word “exclusive” to inside information, special access and other soft benefits—which are almost always retention tools. Yes, those are also likely free, but had Panera worded its “exclusive invites to special events” as “free invites to special events,” an entirely different level of reward would have been communicated.

Beware reverse exclusivity of free enticements. I’m constantly irked by cable-TV promotions like free premium channels offered only to new customers, as I stare at my cable bill and wonder why my loyalty earns me the right to pay full price for those channels. Suppose the cable company had come to me and said, “You’ve heard about the free channels we’re offering new customers for three months. We’ll do you one better by giving you those same channels for six months.” And if your best-customer offer already is better than an acquisition offer, make sure those best customers understand this.

Listen to my Mom. I recall my mother’s crafty homily that the best way to tell Mom “I love you” is to do the dishes. After all, loyalty marketing is a matter of such show-versus-tell—though its effect is far beyond homily. In addition to doing the dishes for you afterwards, these three programs effectively use samples to show customers the quality of their products, especially new ones. This is communication at its most direct. Take the phrase used by Panera: “sumptuous samples.” Sumptuous tells. Samples show.

Show me you really love me. Stop by the house and do my dishes.

Bill Brohaugh
As managing editor, Bill Brohaugh is responsible for the day-to-day management and editorial for the COLLOQUY magazine and, the most comprehensive loyalty marketing web site in the world. In addition to writing many of the feature articles, Bill develops the editorial calendar, hires and manages outside writers and researchers and oversees print and online production. He also contributes to COLLOQUY's weekly email Market Alert and the COLLOQUYTalk series of white papers.


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