Not every sales promotion runs as it’s intended or as successfully as its developers trust it will. Back in 1955 Quaker Oats had one of those not so successful ventures. To tempt customers to purchase more cereal they made what they believed was a big offer – one square inch of Yukon Territory. The cereal manufacturers purchased 21 million of these mini-plots from the Canadian government for $10,000.00. When the promotion did not pan out, Canada took the land back for $37.00 in back taxes!What can you study from this failure? One thing is very clear. Even big organizations with extensive and can bring in mistakes. The second lesson is an invaluable one that proves itself time after time. Here it is.You must be perfectly certain that whatever you offer as a premium or incentive with your product must, absolutely, be something that is desirable enough to be sold successfully on its own. To live and thrive on its own merit and worth! In fact, you need to be totally sure that the offer you provide is at least as valuable to your customers as your core product might be.These incentives should be things that provide more product or more service, cut risk or enhance the opportunity for your customer to receive greater value, cut costs, service their customers better or help them apply your solution easier, faster or better.What about some cases that might be of some value to you? Let’s take a look at a few:

* An air-tight guarantee or warranty

* Enhanced service or support levels

* Free upgrades for a period of time

* Extra product for significant savings

*Special, better or more favourable conditions

* Vouchers, certificates or access codes for ongoing purchases

* Risk reversal with you assuming all of the risk with guaranteed refunds, rebates or additional bonuses for failure to exceed customer expectations

There is little doubt that my older brother might be right when he kids me by saying “It’s free? Give me two. What is it?” But, by the same token, he might not be totally right either. Examples? What if I offered you a free air conditioning unit with your purchase, but you lived in the Arctic? How about a few out of print, DOS software manuals free with your purchase of a computer? How about a certificate good for $5.00 to a restaurant where the cheapest entrée is $50.00? None of these are great bonuses, are they?

Here are some guidelines that you may want to consider when offering bonuses or premiums to lure your customers to buy or buy more. Let’s look at seven:

* The incentive must be a logical extension of or represent a worthful addition to your basic product or service. It must match.

* It needs to be something that represents a clear value worth having. It can’t be something that is either obsolete, did not sell or is apparently being thrown in for your disposal instead of providing a true value to your customer.

* You need to validate your offer with sales and sales management aids/tools, promotional aids and the like. These sales and sales management tools need to be bright, fresh and professional so that your effort has the appearance of being an institutionalised commitment and program

* The product or service you offer needs to be something that customers truly have demonstrated a desire to buy – not something that is just a gimmick or a cute idea.

* Do your best to place a hard dollar value to whatever your premium or incentive is and what it’s worth.

* Explain exactly why it’s worth the price you’ve placed on it.

* Place a time frame, terms or minimum purchase levels that the buyer must meet in order to qualify for your highly desirable incentive.

There is little doubt that there are definite times when some form of incentive or promotion is necessary. Maybe for a new product initiation, to jump-start stagnant sales, to aid salespeople and sales manageers in producing better value or to significantly enhance a product or service’s value. But my advice is simply this – think through your strategy and its execution very carefully. There are times when a poorly designed strategy can do more harm than it benefits. After all, you don’t want to purchase something to give away only to have to give it back, eat it or have it cost you more money, do you? I know I don’t. Neither did Quaker Oats!

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