| "Sign up today and you'll get this great gift!" Will an | | | | they helped children. Ooops! That incentive insulted |
| announcement like that motivate a customer to | | | | the fire department's mission which was to |
| buy and buy right now? Not always. | | | | educate and keep people safe. |
| Here are several scenarios where a customer | | | | 3. When It Is Expected - Ever train a dog? Treats |
| incentive--be it cash, merchandise or discounts--will | | | | work great. Sometimes too great. If you cannot |
| not help make a sale and may even cause you to | | | | get obedience without the treat, your dog has |
| lose business: | | | | trained you very well. Same with customer |
| 1. When the Sale Would Have Closed Even | | | | incentives. You give them a great gift for doing |
| Without the Incentive - In selling advertising, the | | | | business with you. Next transaction, you give one |
| organization I was representing decided to offer a | | | | again. And on the next one, too. Your customers |
| merchandise gift if the client would sign a new or | | | | will then begin to expect this reward, whatever it |
| renewal contract by the end of the year. When | | | | is, every time you do business or they'll go away. |
| he signed the contract, I asked one of my regular | | | | In that case, the incentive becomes a part of the |
| clients if the gift helped make his decision to | | | | transaction and not a reward. Take a tip from |
| renew early. He said it did not and that he signed | | | | dog trainers and learn to "fade the lure." Sure, you |
| because he appreciated the continued great | | | | might want to shower customers with a great |
| service that the organization and I provided. | | | | gift when they first start working with you. On |
| Would have closed that sale even without the gift. | | | | succeeding transactions, make the reward |
| Wasted marketing dollars! | | | | something a little less each time. By that time, |
| 2. When a Gift Would Insult the Intelligence or | | | | your excellent service, not the incentive, will be |
| Professionalism of the Recipient - In Tested | | | | the reason your customer continues to buy. |
| Advertising Methods by advertising legend John | | | | 4. When It Will Not Increase Future Sales - |
| Caples, which was updated by Fred Hahn (5th | | | | Restaurants are all too aware of this. Coupons or |
| Edition), Hahn tells the story of a company who | | | | reward programs for free appetizers, desserts, |
| was selling children's fire safety educational films | | | | or entree discounts are popular with customers. |
| to fire departments. At the offer of a gift for | | | | Use with caution since this may only attract the |
| using the films, the firefighters were incensed that | | | | coupon clipping crowd that is here today and gone |
| anyone would think they would use the films | | | | when the promotion ends. Instead concentrate on |
| because of the gift. They would only use them if | | | | developing a devoted following. |