Free prize inside

Customers love free stuff, don’t they? The problem is that, when you own a very small business, giving away free stuff cuts too much into your profit margin. … Or does it? Linda Balon-Stein of Zosimos Botanicals, a “green” cosmetics company, says it doesn’t have to.

For example, at an Earth Day event yesterday, Linda gave customers gift bags containing her business card, a brochure, a packet of organic sunflower seeds and an emery board made of recycled cardboard that was imprinted with her website address. While other cosmetic companies gave away cosmetic product samples, Linda charged for her samples because they are the core of her business. Linda says that the items she gave away were inexpensive and they made her customers happy. And this made Linda happy because the free items did not cut nearly as deeply into her profit margin as giving away free samples of her handmade beauty products would have.

In his book, “Free Prize Inside,” author Seth Godin talks about the fact that a “free” gift does not have to be spectacular and earth shattering to make an impression. People remember that “something extra” they get for choosing to do business with you, even when it doesn’t cost a lot of money. Free gifts don’t have to be expensive to capture people’s attention and cause them to remember your brand in a positive light.

So take a tip from Linda and stop giving away the core of your profit margin. Create a collection of inexpensive, branded tokens of appreciation that you can share with your customers. They’ll appreciate your sincerity and they also just might value your products more when they see that you are not giving them away.

Question: What do you think of Linda’s strategy? What inexpensive freebies can you offer customers to put your business in a positive light without breaking the bank?

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  • D’Anna Catterson, Lily Gulch S

    I understand the common sense logic involved in not breaking the bank with free product samples. If it works best for your business to use less expensive alternatives, great! I recently had some awesome, but inexpensive, business logo button magnets made up to include in orders.
    But honestly, I love giving out free sample products with every order! How much free product depends upon the size of the order. I have always given out affordable free product samples with every order size and always will because of the proven (trackable) additional product sales and repeat business directly attributed to those samples. It’s working for my business to do so. Just as importantly, most of my fellow soapmakers and b & b product makers do the same. I really don’t think doing so devalues my product in the slightest. In fact, I think it shows my customers how much I value them. I do also offer for sale sample sizes of all my products, and many customers take advantage of those options.

  • http://www.lilygulchsoaps.com D’Anna Catterson, Lily Gulch Soaps

    I understand the common sense logic involved in not breaking the bank with free product samples. If it works best for your business to use less expensive alternatives, great! I recently had some awesome, but inexpensive, business logo button magnets made up to include in orders.
    But honestly, I love giving out free sample products with every order! How much free product depends upon the size of the order. I have always given out affordable free product samples with every order size and always will because of the proven (trackable) additional product sales and repeat business directly attributed to those samples. It’s working for my business to do so. Just as importantly, most of my fellow soapmakers and b & b product makers do the same. I really don’t think doing so devalues my product in the slightest. In fact, I think it shows my customers how much I value them. I do also offer for sale sample sizes of all my products, and many customers take advantage of those options.

  • http://www.indiebusinessnetwork.com/ Donna Maria @ Indie Business

    @D’Anna: Awesome points! It sounds like you have 3 avenues that work for you: samples for free, samples for sale and other branded things (not products) that work as well. It’s great to have options and thanks for sharing these. You’re right — it’s not just about what works for you, but also what works for your customers! I love getting free product samples when I order and most Indies are very generous with something special. Thanks for sharing your experiences here. I am happy that others will see, assess their options and be inspired by you!

  • http://www.indiebusinessblog.com Donna Maria @ Indie Business

    @D’Anna: Awesome points! It sounds like you have 3 avenues that work for you: samples for free, samples for sale and other branded things (not products) that work as well. It’s great to have options and thanks for sharing these. You’re right — it’s not just about what works for you, but also what works for your customers! I love getting free product samples when I order and most Indies are very generous with something special. Thanks for sharing your experiences here. I am happy that others will see, assess their options and be inspired by you!

  • http://www.creativewanderings.ca/ Jennifer

    I love giving samples as well. One thing that I do, is take advantage of Vista Prints freebie promotions. I get pens, postcards, magnets, business cards with 15% off savings, keychains all printed with my logo (I pay the file upload fee and shipping, it still brings my cost down really low).
    I haven’t figured out how to track the repeat orders on samples yet. But I do tend to give out product freebies based on how much a person purchases. It usually is a full size lip balm, or a 1/4 bar of soap.
    One tack I am trying this year, is to have gift bags on my table with a hostess gift in them (currently, its a clippy magnet, notepad and magnet with my logo). I also include invitations, order forms, and other paperwork on hosting a party. There will also be a few token samples in there (not full size) that they can show their family and friends. The bags will have a “date” for a party on them, allowing the customer to book their party with me right then.
    I would love to know where she got the emery boards. That is a fantastic marketing idea!

  • http://www.creativewanderings.ca Jennifer

    I love giving samples as well. One thing that I do, is take advantage of Vista Prints freebie promotions. I get pens, postcards, magnets, business cards with 15% off savings, keychains all printed with my logo (I pay the file upload fee and shipping, it still brings my cost down really low).
    I haven’t figured out how to track the repeat orders on samples yet. But I do tend to give out product freebies based on how much a person purchases. It usually is a full size lip balm, or a 1/4 bar of soap.
    One tack I am trying this year, is to have gift bags on my table with a hostess gift in them (currently, its a clippy magnet, notepad and magnet with my logo). I also include invitations, order forms, and other paperwork on hosting a party. There will also be a few token samples in there (not full size) that they can show their family and friends. The bags will have a “date” for a party on them, allowing the customer to book their party with me right then.
    I would love to know where she got the emery boards. That is a fantastic marketing idea!

  • http://www.indiebusinessnetwork.com/ Donna Maria @ Indie Business

    @Jennifer: I have asked Linda to stop by and share her source for emery boards. This conversation reminds me of last week’s Indie Feature with a brand new soapmaker who said that her best and most reliable sales come after she gives out a sample and then follows up afterward! The link to enjoy that feature is here: http://www.indiebeautynetwork.com/channel-newsletter/arc2009/20090413.asp#feat

  • http://www.indiebusinessblog.com Donna Maria @ Indie Business

    @Jennifer: I have asked Linda to stop by and share her source for emery boards. This conversation reminds me of last week’s Indie Feature with a brand new soapmaker who said that her best and most reliable sales come after she gives out a sample and then follows up afterward! The link to enjoy that feature is here: http://www.indiebeautynetwork.com/channel-newsletter/arc2009/20090413.asp#feat

  • Roberta Perry

    I totally believe in cool items with branding and will most likely do one in the future. Kudos to your ideas!
    I have found, however, that as I grow and figure out effective ways to expand our reach, the “trying then buying” mentality works really well.
    I consider every give-away or gift a chance to have someone share the product or get to sample a new scent, etc. I have sent samples of Oilz to a frequent Scrubz customer so they can be introduced to a different product.
    I have tracked back quite a bit of business from the samples I have sent or donated as goodies for event gift bags. For me, it’s my advertising budget and has allowed for a lot of organic word of mouth advertising as well.
    Thanks so much dM and indies for all the great info!

  • Roberta Perry

    I totally believe in cool items with branding and will most likely do one in the future. Kudos to your ideas!
    I have found, however, that as I grow and figure out effective ways to expand our reach, the “trying then buying” mentality works really well.
    I consider every give-away or gift a chance to have someone share the product or get to sample a new scent, etc. I have sent samples of Oilz to a frequent Scrubz customer so they can be introduced to a different product.
    I have tracked back quite a bit of business from the samples I have sent or donated as goodies for event gift bags. For me, it’s my advertising budget and has allowed for a lot of organic word of mouth advertising as well.
    Thanks so much dM and indies for all the great info!

  • http://www.indiebusinessnetwork.com/ Donna Maria @ Indie Business

    @Roberta: I am so digging this discussion of interesting ways to do business. Thanks for sharing — sounds like you have an awesome thing going with your sample sharing of oilz and butterz. I know first hand why people come back for more!

  • http://www.indiebusinessblog.com Donna Maria @ Indie Business

    @Roberta: I am so digging this discussion of interesting ways to do business. Thanks for sharing — sounds like you have an awesome thing going with your sample sharing of oilz and butterz. I know first hand why people come back for more!

  • http://www.zosimosbotanicals.com/ Linda @zosimos

    @Jennifer: The emery boards can be obtained from: Larry Bluestone
    Overture Premiums & Promotions
    595 N. Lakeview Parkway
    Vernon Hills, IL 60061
    http://www.overturepromo.com
    847.680.2255
    Please tell Larry I referred you. He and I went to summer camp together when we were teens and reconnected with each other on Facebook!

  • http://www.zosimosbotanicals.com Linda @zosimos

    @Jennifer: The emery boards can be obtained from: Larry Bluestone
    Overture Premiums & Promotions
    595 N. Lakeview Parkway
    Vernon Hills, IL 60061
    http://www.overturepromo.com
    847.680.2255
    Please tell Larry I referred you. He and I went to summer camp together when we were teens and reconnected with each other on Facebook!

  • http://www.ladolcediva.com/ Jennifer Kirkwood

    I believe the subject of gift bags came up when “swag” was mentioned on #indiechat Wednesday night. I think it is great to have give-away promo items that pertain to your business. Great at a trade show or some sort of direct to consumer situation.
    However, in most cases, when a business is approached to take part in the gift bag for an event, party, etc. Swag means actual product that you produce. They want representation of your company/product.
    Yes, it can be specifically produced for giveaways. It can also be a discount card for a percentage, dollar amount off purchase or some variation.
    But often times it seems you are constantly being told by PR people that this is a great way to get your name out there, and you never know what can happen. Yet-there seem to be few examples of that magic contact resulting in a promising wholesale account.
    I found that I felt as if participation in these gift bags was a carrot being offered, “Look, see, someone WANTS you.”
    In the long run, nothing much ever came of it. All the while I was paying my PR rep (with a very good reputation in boutique PR- just new to my category) a monthly retainer.
    How often have you received something in a gift bag and actually followed up with an order?
    Your PR person’s contacts are extremely important. Problem is, if they have great contacts and connections, it cost $$. If they are more affordable, you will probably get more local coverage. Paying a PR person is not “you get what you pay for” because as most every PR person will tell you, that is not the way it works.
    Don’t get me wrong. I think PR and advertising are VERY important. The biggest struggle as a small biz is trying to balance and decide when you take part and how much to spend. I also love to get actual product in the hands of actual consumers. I agree with the “try before you buy” strategy.
    It is just hard to rationalize 30- 500 gift bag items at a time for one online retail order in return. That is not good ROI (return on investment) even with word of mouth, grass roots growth or whatever. At least not at this stage of the game.
    I often participate in silent auctions and causes I want to support. I also investigate potential swag situations if they seems to be a bit more affordable and mutually beneficial. I try to make sure I am not just “any product will do” to fill the bag. I want to be sure that the end recipients may be potential consumers by MY definition not the person requesting the Swag.
    But, in general, I shy from Swag Bags, even though they are tempting. You feel like you have to or you missed that GREAT opportunity. But have you? I think these types of gift bags serve a purpose when you are large enough to garner publicity and promotion for taking part in the event. And you probably already have name recognition.
    Until then, I am trying to spend my time and money on putting together media pitches and targeting retailers.
    Many may disagree with me. This is just my experience. I didn’t mean to turn this into a rant. I just wanted to be sure the difference between Swag (as in PR Event Gift Bags) and Promo-Give-Aways was understood.
    Swag Bags may work for your company. Maybe I just haven’t found the right opportunity and target market. Have you?

  • http://www.ladolcediva.com Jennifer Kirkwood

    I believe the subject of gift bags came up when “swag” was mentioned on #indiechat Wednesday night. I think it is great to have give-away promo items that pertain to your business. Great at a trade show or some sort of direct to consumer situation.
    However, in most cases, when a business is approached to take part in the gift bag for an event, party, etc. Swag means actual product that you produce. They want representation of your company/product.
    Yes, it can be specifically produced for giveaways. It can also be a discount card for a percentage, dollar amount off purchase or some variation.
    But often times it seems you are constantly being told by PR people that this is a great way to get your name out there, and you never know what can happen. Yet-there seem to be few examples of that magic contact resulting in a promising wholesale account.
    I found that I felt as if participation in these gift bags was a carrot being offered, “Look, see, someone WANTS you.”
    In the long run, nothing much ever came of it. All the while I was paying my PR rep (with a very good reputation in boutique PR- just new to my category) a monthly retainer.
    How often have you received something in a gift bag and actually followed up with an order?
    Your PR person’s contacts are extremely important. Problem is, if they have great contacts and connections, it cost $$. If they are more affordable, you will probably get more local coverage. Paying a PR person is not “you get what you pay for” because as most every PR person will tell you, that is not the way it works.
    Don’t get me wrong. I think PR and advertising are VERY important. The biggest struggle as a small biz is trying to balance and decide when you take part and how much to spend. I also love to get actual product in the hands of actual consumers. I agree with the “try before you buy” strategy.
    It is just hard to rationalize 30- 500 gift bag items at a time for one online retail order in return. That is not good ROI (return on investment) even with word of mouth, grass roots growth or whatever. At least not at this stage of the game.
    I often participate in silent auctions and causes I want to support. I also investigate potential swag situations if they seems to be a bit more affordable and mutually beneficial. I try to make sure I am not just “any product will do” to fill the bag. I want to be sure that the end recipients may be potential consumers by MY definition not the person requesting the Swag.
    But, in general, I shy from Swag Bags, even though they are tempting. You feel like you have to or you missed that GREAT opportunity. But have you? I think these types of gift bags serve a purpose when you are large enough to garner publicity and promotion for taking part in the event. And you probably already have name recognition.
    Until then, I am trying to spend my time and money on putting together media pitches and targeting retailers.
    Many may disagree with me. This is just my experience. I didn’t mean to turn this into a rant. I just wanted to be sure the difference between Swag (as in PR Event Gift Bags) and Promo-Give-Aways was understood.
    Swag Bags may work for your company. Maybe I just haven’t found the right opportunity and target market. Have you?

  • http://www.awildsoapbar.com/ maggie, soapbartender

    We have samples for purchase, both wholesale and retail…but we always give away a free bar of cosmetically challenged soap with every $30 order. Our customers love this and it usually increases the amount of the sale too. I am a firm believer that what you give away comes back to you in even greater proportions.

  • http://www.awildsoapbar.com maggie, soapbartender

    We have samples for purchase, both wholesale and retail…but we always give away a free bar of cosmetically challenged soap with every $30 order. Our customers love this and it usually increases the amount of the sale too. I am a firm believer that what you give away comes back to you in even greater proportions.

  • http://www.lemon-lollipop.com/ Michelle

    What a great discussion! I’m a sample FREAK! I offer samples for sale of just about everything I offer. I think it builds trust and there’s usually a coupon to “return in two weeks for some kind of deal” to promote buying full size products. Every order gets a free sample perfume oil-with a FREE SAMPLE sticker. And they are lightweight so it doesn’t effect my postage. Because I sell my samples, the free sample has a monetary value, which I think helps me. Any time I can get my ooey gooey product in a potential customer’s hand, that is a good thing!
    I also participate in sample boxes which are often on a monthly basis. People actually pay to receive a box full of goodies (how fun is THAT?!) and I like to be inside…the customer is already very excited opening the box and I like to associate Lemon Lollipop with those good feelings!
    I’ve done swag bags when I think the recipients will be huddling together, “what did you get”, “well what did YOU get”…”oooh, I got this from Lemon Lollipop” is kinda what I’m going for. Usually swag bags are a huge investment of time and money, so I rarely do them.
    I’m always surprised that customers take time to thank me for the free sample. That means it has some sort of meaning or value for them…which in turn means that they’ll remember me. Positive repetition is the key to purchasing!

  • http://www.lemon-lollipop.com Michelle

    What a great discussion! I’m a sample FREAK! I offer samples for sale of just about everything I offer. I think it builds trust and there’s usually a coupon to “return in two weeks for some kind of deal” to promote buying full size products. Every order gets a free sample perfume oil-with a FREE SAMPLE sticker. And they are lightweight so it doesn’t effect my postage. Because I sell my samples, the free sample has a monetary value, which I think helps me. Any time I can get my ooey gooey product in a potential customer’s hand, that is a good thing!
    I also participate in sample boxes which are often on a monthly basis. People actually pay to receive a box full of goodies (how fun is THAT?!) and I like to be inside…the customer is already very excited opening the box and I like to associate Lemon Lollipop with those good feelings!
    I’ve done swag bags when I think the recipients will be huddling together, “what did you get”, “well what did YOU get”…”oooh, I got this from Lemon Lollipop” is kinda what I’m going for. Usually swag bags are a huge investment of time and money, so I rarely do them.
    I’m always surprised that customers take time to thank me for the free sample. That means it has some sort of meaning or value for them…which in turn means that they’ll remember me. Positive repetition is the key to purchasing!

  • http://www.taylormadearomatherapy.com/ Christy Teter

    I totally agree about the samples. Sending a free sample with every order not only promotes your business, but it sends a thank you in the package. I found when we feature a new product, we offer a sample that month of the new product. The customer gets to try the new product, returns to the website and purchases a full size jar.
    I know there are companies who promote your business by asking you to send 30-50 free samples per month. They make a sample box of your samples and other companied and sell them online. It promotes your business to a different clientele and your SEO and page ranking changes.
    Yes it could cut into your budget and profits, but it TRULY is the best advertisement along with word of mouth.
    God Bless,
    Christy

  • http://www.taylormadearomatherapy.com Christy Teter

    I totally agree about the samples. Sending a free sample with every order not only promotes your business, but it sends a thank you in the package. I found when we feature a new product, we offer a sample that month of the new product. The customer gets to try the new product, returns to the website and purchases a full size jar.
    I know there are companies who promote your business by asking you to send 30-50 free samples per month. They make a sample box of your samples and other companied and sell them online. It promotes your business to a different clientele and your SEO and page ranking changes.
    Yes it could cut into your budget and profits, but it TRULY is the best advertisement along with word of mouth.
    God Bless,
    Christy