Home Promotion Premiums for Consumers – A Good Idea?

Premiums for Consumers – A Good Idea?

by Master Fool

Often or not, many when it comes to thinking of a consumer promotion, the most simplest and easiest form would be premiums. But is it really a good idea? Is this a visible option? How does it benefit the brand and does it maximize the sales opportunity? It actually all comes down to your objective of giving away this premium. Like any other business considerations, there is no right or wrong or good or bad. The main question is if it serves your objective!

So really, what is your objectives of running this promotion? Because different objectives serve different purposes. So here are some of the objectives that I could think of

If you would like to reward your consumers

A great marketing tactic because who doesn’t like a free gift!

If you are looking to increase your sales volume

Unless your brand is well established and your premium is very attractive, you can consider giving away free gift. However, beware as this is only a short term tactic as consumers may purchase 1 or 2 more extra to get the free gift but that is what we call pantry loading

If you would like to increase customer base

This would only work if your product category does not have a strong brand loyalty and customers don’t mind switching to your brand just because of your premium. Either this or your free gift has to be really attractive to induce customers to swtich to your brand

If you are promoting a new product

You would like to entice consumers to try your new product and lure them by offering a free gift as value added.

Because your competitor is offering premium

Its not bad to be a me-too but are you also giving away something as interesting? Does the costing allows you to achieve economies of scale?

Any other objectives that I’ve missed out? Share and let me know what are your thoughts.

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