Offering something for free is one of the oldest business tactics around, but it still works when carried out well. By looking at some of the key points, we can see how this can be done wisely to boost any type of business.
Attract New Clients with Special Deals
In many cases, free offers are aimed mainly at attracting new customers. This is a particularly useful strategy in crowded marketplaces where there is little visible difference between the products or services. A strong welcome bonus or offer can help convince a new customer to sign up and try one company instead of another.
This can be seen in businesses such as supermarkets and other retail stores, where most people need a good reason to choose one brand over another. The chance to get a free product when you buy another is a classic marketing approach for this industry that continues to appeal.
It can be seen just as clearly online, where welcome bonuses for new customers are common in different industries. These deals are ideal for capturing the attention of someone who is browsing the options and wants to make up their mind quickly between some similar-looking sites. The offers listed for no deposit casino bonuses show how this works. These deals can provide free spins or bonus funds on different NZ casino sites, giving new players options to get started without using their own funds.
Retain Existing Customers
Bringing in new clients is always a good move, but you can’t afford to overlook the importance of retaining existing customers. These people may have been encouraged to try your business because you offered them something for free, but that means they could be tempted to go elsewhere if someone else gives them a similar offer.
Loyalty schemes provide one of the simplest and most effective ways of giving customers a reason to stick around. This study names AA Smartfuel, Fly Buys, and Air New Zealand as being among the companies offering the most rewarding loyalty schemes in NZ.
These programs for recurring customers can work in various ways, such as by giving them the chance to collect points with each purchase. These loyalty points may eventually be exchanged for rewards like free products, ensuring that the customer benefits as well as the business.
Easy Way for People to Discover Your Products
Offering a product for free is a tried and trusted method of letting people try it for the first time. It can work wonders when you want to launch a new product quickly and create a buzz around it. However, it can backfire if the product isn’t as good as you thought and potential customers don’t find enough value in it, even when it’s free.
Therefore, offering it for free isn’t a recipe for making a quicker product launch or cutting corners. If you’re going to give away something, then it needs to be something you have complete confidence in. While most people will accept a free sample, they will weigh up its quality based on the future retail price, so don’t expect them to carry on buying it just because they got it for free the first time.
Tailor Offers to the Audience
Not everyone is going to accept a free offer, while others might accept it but not have any intention of carrying on doing business with you once it starts to cost them money. Therefore, it’s vital that you understand the audience that you plan to give free offers to.
Ideally, you want this bonus or gift to reach people who are likely to carry on purchasing the product regularly once it costs them money. The New Zealand Food Innovation Network is an example of a company that aims to help startups in the food industry get going by giving them help and practical advice along the way.
Calculate Cost vs Benefits
Offering free products and services makes a lot of sense but don’t forget to crunch the numbers. It needs to make financial sense for you as well as for the customer. Remember to take into the cost of marketing and the logistics of giving it away, as well as the basic production costs. You can’t afford to over-stretch your budget before you even start selling anything. Once you do start selling, make sure your price reflects your product. As we have stated in the past, selling cheap is not the best tactic for your business or your customers, instead set a fair and profitable price and ensure you are delivering a product that is worth the price and stands out from competitors.
Bear in mind that the people who receive your free offer might undervalue it because we tend to assume the quality of a product based on its cost. If they have no reference point to help them calculate what it’s truly worth, you might need to point out the future cost at the start, to avoid disappointment later.
Free offers remain one of the most powerful ways to connect with your audience. However, they only work as intended when you take the time to carry out the process carefully and consider the previous points.