Does this work - consumers/dealers?

[BauerN]

Hey there all!  

Working on some sale ideas here (we have this AWESOME thaw!), with an additional goal.

We have not done this type of promotion before-

We're discussing a moderate ticket give-away with spa purchases.  So far ideas range from T.V.s and laptops to free gas.  The promotion idea is transparent.  The "additional goal" is to get $10,000 or more flowing around the local economy (if you don't see how this benefits us, please search "Keynesian Economics").

What I'd like help with is:

1)  Consumer and dealer opinions of this type of promotion at large.

2)  Have any dealers used this type of promotion?  If so, how? And with what degree of success?

3)  Have any customers purchased from this type of promotion?  If so, what did you like/dislike?

4)  Any advice from anyone on what would be a USEFULL/DESIRABLE freebie.

5)  Any pros/cons anyone can come up with?

Whew...that's a bit for a first request.  

Please help with this.

P.S.  Jokes and ribbing are expected (I'll be the first to mention the Boy Scout mentality - we're a small community and we try to stay as proactive as we can - the other guys razz me a lot about donating personal time).  

[wmccall]

My first question would probably be, whats the price without the ........

[In Canada eh]

BauerN,

   Great to see you trying to do your own part and stimulate the local economy.

I can't speak for all consumer but these kind of promotions have not had any influence on my purchasing decision in the past.  I have always been a little leery of them actually, figuring that even though you can win a TV , you are actually paying for it in the cost of what-ever your buying.

Just my 2 cents

[Steve]

I think the responses so far give an accurate picture to the general buying public.

Nothing worthwhile is free and if there is a "free" aspect of the sale, we all know damn well we're paying for it somewhere...

I too would want to know the cost if I don't take this free item and you'll need to be prepared for clear answer. If there is very little difference (or none) the value of the "give-away" is relative.

I would suggest you use something like that for referrals instead and get your customers generating additional sales for you. The obvious factor is the cost of what you can get these give-away items for. There's a few ways to get decent pricing on these by either advertising the company that's providing them with a poster/banner of their company in your store or in print or offering the use of spa for long weekend er somptin like that. Just thinking off of the top of my head right now.

The tough part is finding something that has value to the masses. Fuel is interesting but not terribly exciting. Would it make a big enough difference to create a sale that otherwise wouldn't have been?  :-/

Value can be created in so many other ways that I think the cost of this proposition negates the overall value. Maybe I'm just being overly negative...I dunno...

Steve

[BauerN]

The cost with the free item (no contests or drawings) would be our regular retail discounted at 10%.  (Last year's models at 20%.)

Cost without a free item would include a cash discount equal to the cost of the item.

So it's very obvious that the item is included in the price - nothing secret there.  And yes, we'll be working out a way to get the item(s) at a discount.

No one is being too negative - this is exactly what we need here.  We have up to this point sold without "gimmicks".  We have built a great reputation in our area so far.  While we want to be outside the box, we don't want to create a negative image.

This is in the "cocktail napkin" phase right now.  We have an early shot of great weather (for us) right now, and would like to boost sales a bit (even if we eat some of the margin).

Everybody's responses are very appreciated, please keep it coming.

[In Canada eh]

I would suggest you use something like that for referrals instead and get your customers generating additional sales for you.

This would be a great idea.  Offer your existing customers a $50 store credit for each referral that they send in.  You would turn all of your past customers into additional sales help. 8-)  I send everyone that mentions they are looking for a tub to our dealer (just because they are nice, honest people), $50 would give me a little more incentive.

[searchinginfl]

I agree with all of the above....no gimmicks, I know I pay for it. In fact, I would more likely NOT buy when some promo like that is going on. I think including a year of chemicals, or some type of free upgrade, or financing is more appealing.

[BauerN]

This would be a great idea.  Offer your existing customers a $50 store credit for each referral that they send in.  You would turn all of your past customers into additional sales help. 8-)  I send everyone that mentions they are looking for a tub to our dealer (just because they are nice, honest people), $50 would give me a little more incentive.

We have rewarded referrals from day one.  Sometimes as little as a hat or t-shirt for sending chemical or accessory business our way.  On a couple of occasions (when we became order-takers) we have given $200 in chemicals/accessories.

Thank you all again. I value all of the input I've received.

I wouldn't mind a few more opinions or ideas if anyone will throw in another $.02

*we will be meeting on this in our store on Monday.  I will not be able to view again until Sunday - please keep input coming.

[Steve]

I do commend you on wanting to get creative and generate sales and as a previous manufacturers rep, I was often asked how to produce a great sale. I have helped create a document on this very topic for my previous business partners and forwarded it to a couple people here in the past as well. I'm more than willing to share it with you Bauer.

Fire me an email address in a PM and I'll put together a few documents that can certainly help. Normally, I charge $1500 (+ expenses) to come and do a complete seminar on this and many other facets of various sales strategies but for you… I’ll take one of those free laptops instead!

Steve

[ndabunka]

If your really trying to drive something for the community, why don't you simply donate $150 per spa bought to a local charity that could use the benefit.  You could offer buyers of the new spa a "donation in their name" to the local charity.  I think they could even deduct it on their taxes.  Something like "Buy a Spa at our normal 10% discount and we will donate $150 in your name to Boy Scout troop 87".  That way you are promoting the community but don't (generally) have anyone asking for the $'s to simply be "taken off" the price of the spa.  Of course, you would have to make it VERY clear that they are buying the spa at (or better) than the price they could normally get it for.  There's a fair amount of book keeping to make certain that the donation goes in "under their name" but it would help your local image to demonstrate that you are giving more than just "your time"...your also giving up your profits ($150 per spa).  I don't think that even the cheapest spa buyer would take money away from the Boy Scouts by asking that you "add the $150 discount to their savings" rather than giving it to the Boy Scouts...

If you do use this idea, I wouldn't mind a tee shirt!  

[TubsAndCues]

We've had mostly positive response when we've done things similar to this.  We used to do a deal where you buy a hot tub and get a pool table for free.  (We also sell pool tables, just to be clear)  

There were only a few times when people asked for the price of the pool table off of the price of the tub instead.  On rare occasions, customers had a hard time grasping that the retail price of the table was not what we paid for it, and felt they should get a bigger discount off of the tub.  

As far as using companies/other products from outside of your own store to provide the goods, we've tried giving away vacations, electronics and other items, and while it brought some good attention, only a few customers took us up on the "freebies" rather than taking an additional discount.  In the end, we broke even for what we gave away to what it brought in.  I can't really say it did much in our case.

[Chas]

Each market is going to respond differently. I bought a bunch of cruise packages last year - did an ad splash, newspaper, direct mail, in-store promo materials.

Most folks didn't care at all for the packages. I just couldn't give them away, and they ended up expiring. I am trying to get in contact with the guy who sold them to me to see if they can be renewed or extended in any way, otherwise it was almost a complete and total write-off.

Something which has worked in the past is to do a joint venture with some local companies - have a parking lot sale and invite some other companies to set up in your parking lot like a home show. Not competing dealers, but other home goods.

They pay for the advertising, you get the traffic. Of course, you need to have something special to offer, and you should send out direct mail/phone your existing customer database.

 8-)

[Steve]

Each market is going to respond differently. I bought a bunch of cruise packages last year - did an ad splash, newspaper, direct mail, in-store promo materials.

Most folks didn't care at all for the packages. I just couldn't give them away, and they ended up expiring. I am trying to get in contact with the guy who sold them to me to see if they can be renewed or extended in any way, otherwise it was almost a complete and total write-off.

Something which has worked in the past is to do a joint venture with some local companies - have a parking lot sale and invite some other companies to set up in your parking lot like a home show. Not competing dealers, but other home goods.

They pay for the advertising, you get the traffic. Of course, you need to have something special to offer, and you should send out direct mail/phone your existing customer database.

 8-)

Exactly Chas! The document I proposed is dedicated to just this sort of event. There's a lot of planning a preparation which needs to go into such an event and the better this is done, the greater chance of a successful sale.

There's a fair bit more than putting tubs in a parking lot and blowing up some balloons!

We use to hvae 4 major parking lot events per year and gained 70+% of our sales in these every year.

[Zep]

I think it's a great idea.

Yeah some will ask the price without the prize, most won't.

Gimmicks work.....I am in a different business but we get people
to spend hundreds if not thousands of dollars by "giving" them
a $25 Chili's Restaurant gift certificate. You do the math....LOL

Alot of consumers visit a couple of spa stores and then
make a purchase....the prize could be the tipping point to
buy from you instead of someone not offering "a prize".

Also what do you lose by offering it?

To me it only has an upside.

If someone prefers to take the discount over the prize....so what?
You've still made a sale and thats the whole point anyway.

I say GO FOR IT!

[BauerN]

A great deal of thanks to everyone who responded to this thread.  EVERY post was valuable - reminding me again of why I value this forum.

I apologize for not getting back to this until now (was pretty beat up on Sunday - took an extra day out of the office).

The final word is not back from the owner and GM.  I think we are going to try it out - with some modification based on responses here (and Steve's help).

Thanks again, this is a GREAT forum!