FREE! This Four Letter Word Can Make You a Lot of Money - Part 2
Yesterday we talked about using the word "FREE" in your marketing. Here's another example:
Here's what we did with an upscale carpet and rug showroom. Since they relied on interior designers for a large percentage of their business, they wanted to find a way to make themselves "a better deal" for designers. They also wanted to find a way to compete for retail customers with the emerging do-it-yourself carpet places like Home Depot. The FREE strategies for both situations (designers & retail buyers) are good examples of how to maximize FREE-ness without losing profitability.
For the retail buyers, we came up with a program that gave them FREE carpet cleaning for a year with the purchase of carpet or rugs. Wait a second! How can you give away free carpet cleaning and not go broke, you might ask. Simple. We made an arrangement with a carpet cleaning company that already spends a ton of money on advertising in Val-Pak, the yellow pages, and other expensive media. Their advertising cost to acquire a new customer, we found, was actually pretty high.
So we made a deal with them to give us a discount equal to (actually greater than) the amount they spent on advertising. This was roughly half of the sales price. When the customer buys carpeting, we give them vouchers good for two free carpet cleanings (a year's worth) that are dated and signed. When they actually redeem the coupons, the carpet cleaning company then bills our client half the face value.
Since their average standard job runs about $70 (special treatments are extra and not included), the out of pocket cost is about $70. But it's actually less since not all of the customers will take them up on two cleanings. Now look at the math: if a customer buys 200 yards of carpet for $18/yard, that is a $3,600 job. There's plenty of room in there to cover the measly $70 cost of the program. And by just offering FREE carpet cleaning in the first place, they're bound to bring in more sales. You tell me - if the price for XYZ brand carpet is exactly the same at two different places, but one store says they'll clean it for you for a year, where are you going to buy?
Now, the FREE offer for the designers: in addition to offering them FREE carpet cleaning that they can pass on to their end users, our client also created the "Designer Club." Membership in this club entitles the designer to a myriad of FREE benefits, including FREE office space (including FREE use of copiers, phones, computer, fax machines, etc.), FREE use of the conference room and showroom, FREE drinks, coffee, and snacks at any time, an additional 50% discount not available to non-members, FREE credit union and insurance plan enrollment, MASSIVE DISCOUNTS on travel, couriers, dining, rental cars, health club memberships, and about 17 other things. The designers are also enrolled in an incentive program that allows them to earn points for purchases they can cash in for expensive prizes.
What does it cost a designer to join this "Designer Club?" About $200 a year. But, if they hurry, they can get one of 100 Charter Memberships for FREE...if they meet certain requirements. This program will cost very little to implement, but will have massive rewards for our client. There was no other showroom that even offered one of the FREE benefits.
Think about ways you can integrate free into the way you do business and into your advertising. It's the best risk lowering strategy there is and it's bound to bring you more business more than enough to offset whatever it costs to administer the FREE stuff.
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Using The Word Free In Your Marketing (Part 2) - Adult B2B Marketing Tip
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