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  • 30 October 2014
  • Dr Billy M.

Trick or treat? The value of giving away free stuff this Halloween

Many people celebrate Halloween by carving jack-o'-lanterns, throwing costume parties, or visiting haunted houses. The spirit of the holiday is best captured, however, by the practice of trick-or-treating, when children of all ages pour out into the streets to collect candy from their friends and neighbors. Costumes and masks may be an integral part of Halloween, but gifting children candy has always been its defining tradition, in part, because it creates a "free-prize" effect in that the recipient experiences a good feeling of having gained something with little effort. But how does this relate to your business?

Free is your best marketing strategy

As a business owner, you may have noticed that generosity will almost always catch people's attention. By giving something away, you earn permission to speak and engage with prospective customers. However, you may be wondering whether a "zero" price tag may devalue your product or service. The truth is that this gift-giving tactic can actually raise your visibility and enhance your reputation—benefits that in the long run can far outweigh the cost of your giveaway.

Giving away an idea, product, or service can be an effective way to build a following.

Have you noticed how some authors and content marketers offer free eBooks? Similarly, major companies like Google roll out products for their users without charging a fee, and hotels allow you to use their Internet services at no charge if you download their app. Offering a free product gives readers the opportunity to discover, learn about, and recognize your value and, eventually, reward you by trusting and purchasing your brand.

Giving away an idea, product, or service can be an effective way to build a following. Every day, people hear and see hundreds of advertisements — so many, in fact, that each one becomes less relevant. Instead of spending your hard-earned dollars on ads that only contribute to the noise, consider changing people's behavior toward your products by letting them do a test-run at no charge. This strategy can have a viral effect and quickly lead to referrals, as consumers are more likely to purchase products or services they're already familiar with, or that have been recommended by friends.

Giving can grow your business

First, you should determine whether offering a freebie will threaten your profitability. Your objective is to get something valuable (i.e., customer loyalty and brand promotion) in return for your free giveaway. Also, in some cases, helping someone in need or supporting a cause you believe in may be a good reason to gift your product without receiving immediate equal value in return. Here are some ways that giving your product away can grow your business:

  • Free advertising. In today's highly social world, giving creates a buzz, be it via social media, a mention in a local newspaper, or word of mouth.
  • Brand association. People love to receive things with no-strings-attached. When you brighten their day with your freebie, you create a lasting impression that leads to residual positive feelings whenever they encounter your brand.
  • Positive customer experience. By encouraging customers to try your products or services without risk, you benefit by gaining the ability to offer something different or higher-quality based on the feedback they give.
  • Increased sales. Not unexpectedly, your hook can be the thing that gets customers. The gesture of a freebie encourages customers to stick around and ultimately spend more. On-the-house appetizers in a pub, for example, are more effective than coupons because of the immediacy of the reward. Consequently, patrons are more likely to order entrées.

Additionally, by giving, you are helping to solve the problem of how to acquire customers. In doing so, you shift part of that burden and expense away from your sales and marketing teams and onto product development.

Why does generosity work? In summation, because people tend to value what others value and what's getting talked about the most. A good strategy could be to start the conversation about your product by giving it away. Making sure the item is valuable to the customer will result in both high customer satisfaction and a greater likelihood of referrals.

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