Use Freebies to Boost Your Sales

Lee Polevoi by Lee Polevoi on March 20, 2013
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Who doesn’t like to get something for nothing? Freebie marketing — whereby a business gives away goods or services to promote its brand and boost sales of related products or features  — has proved wildly successful in attracting new customers and encouraging customer loyalty.

Why? Customers and prospects don’t always understand the value of your offering until they’ve tried it. Rather than wait for marketing or advertising efforts to get them thinking about making a purchase, let people experience the value of your product or service, at least in a limited version.

An increasingly popular freebie marketing model is called “freemium.” Essentially, a company offers a basic service for free but charges a fee for premium features. This strategy plays into a fundamental aspect of human psychology that some experts call “the norm of reciprocation.” Customers or prospects who take advantage of your free offer often feel compelled to patronize your business, either on the spot or in the future.

Freemium offers often involve giving away limited-use software, such as a social game (which costs nothing to download and play), and then charging a premium to unlock advanced features or to purchase related products or services. But many other industries use it to their advantage. For example, think about the ice-cream shop that invites you to sample its latest flavor on a tiny plastic spoon. Tasting that free sample is your first step toward placing an order, which may end up being two scoops instead of one — just because the sample tasted so good.

Your small business can use freebies to boost its sales, too. Here’s how.

Set Your Freebie Goal

Before determining what type of freebie to give customers and prospects, set the business goal you wish to achieve. It can be one or all of the following:

  • Boost web traffic
  • Generate qualified leads
  • Create a buzz to get people excited
  • Sign up more newsletter subscribers
  • Increase your Facebook followers
  • Build trust and interest in your business

Whatever your goal, having a precise idea will help you effectively package your offer.

Choose the Right Freebie

The best freebie is one that costs you little or nothing to produce but delivers measurable results. Giving away an e-book rewards people for joining your mailing list or subscribing to your newsletter, and it can generate leads.

If you’re introducing a new product or service, consider offering it on a one-time, free-trial basis. People who like what they see or experience are likely make a purchase. If not, you may garner enough customer feedback to stage a more successful re-launch down the road.

Other types of freebies include:

  • Software and mobile apps
  • White papers
  • Promotional products (branded pens, bookmarks, keychain fobs, etc.)
  • A free consultation
  • Samples of foods or snack items

After figuring out what you’d like to give away, think about joining forces with another local business to cross-promote complementary products or offer a package deal. This expands the types of freebies you can offer and the potential target audience that receives them. Another option: See whether a vendor or supplier would like to be part of your marketing campaignEither way, your expenses are reduced and your profit margin increased.

Meanwhile, contact websites, blogs, forums, and other social communities that seek out online promotions and ask them to share your offer with their freebie-hungry readers or subscribers. You get better visibility, and their readers or users win, too.

Lee Polevoi

Lee Polevoi is an award-winning business writer specializing in the challenges and opportunities facing small business. He is former Senior Writer at Vistage International, a global membership organization of CEOs.

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