There are two things that a marketer needs to overcome to convert a prospect into a buyer. The first is a prospect’s objections and the second is a prospect’s tendency not to take action.
One way to overcome these obstacles is to make an offer that your prospects will find irresistible. Freebies or giveaways are often appealing to prospects. Everyone loves to get something for nothing!
Why Give Away Something for Free?
Some companies are resistant to the idea of giving something of value away because of the cost. This is of less concern for information marketers, since the overhead on information products is relatively low.
The important factor to consider is the lifetime value of the customer. In other words, if it costs $5 on average to give away something to a prospect and the average first purchase the customer might make is $6 – it might at first seem like too small a margin to justify the giveaway.
It is important to factor in the lifetime value of that customer. Over time, customers will make additional purchases. Especially if they feel they’ve gotten value from their first purchase. Over time, this amount adds up to much more than the $5 spent to acquire that customer in the first place.
What Should You Give Away for Free?
Information marketers have lots of opportunities to give away freebies. For example, you could give away the first class in a video course, the first chapter of a book, or a free report.
Giveaways can demonstrate the quality of a product at no risk to the prospect, generates a feeling of goodwill toward the company, reduces the perception of risk in the prospect’s mind, and starts a habit of purchasing your products or services.
A Word of Warning
Don’t overuse freebies, as this can have the opposite effect and instead create a perception that the product has no value.
Some retailers have hurt themselves by offering too many discounts and sales. Customers become trained to wait for sales to make purchases.
In order to avoid this, make sure to target your giveaway carefully. Make sure that your giveaway will be enticing or meaningful to your target audience.
An example of a good use of a giveaway is to offer free copies of your product to experts in your niche. These experts might give your product good reviews creating powerful social proof without watering down the perceived value of the product.
Create Something of Value
Also, make sure that your giveaway is useful and hard to toss aside. The more value you create in your giveaway or incentive, the more your prospects will trust you and your products.
One example of this was a company that gave away a popular hardcover book with purchases of their product. The books cost less than the profit margin of the product, but they contained great value and were hard to simply throw away.
And make sure prospects are aware of the value of your giveaway. If a freebie has a dollar value, include that in your marketing materials. People love to know exactly what value they are receiving.
You will foster a feeling of goodwill, prospects will feel more inclined to buy from you out of a sense of reciprocity.
With Value comes Incentive
A giveaway can be shaped as an incentive, such as free gift with purchase. This increases the perceived value of the purchase and in some cases can remove the risk from the purchase. For example, a tax preparer could include a free review to find any missed deductions.
An incentive like this removes the perception of risk associated with the purchase and can result in more sales.
If you are promoting an affiliate product, create a short report filled with valuable, actionable advice. Strategically place links for your product offer within the report and give it away for free on your website or Facebook page.
You can also use a freebie incentive as part of an advertising campaign. This has been done very successfully in the past. Just be sure to test carefully to make sure the campaign is profitable.
When done correctly, giveaways and freebies are one of the best ways to convert prospects to customers. A giveaway creates a feeling of goodwill and reciprocity with your prospects. It also allows them to try your product or service risk-free.
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