Have you ever upgraded your internet because the purchase came with a free subscription to a streaming service? Or clicked “add to cart” because hitting a certain order minimum would earn you a gift card toward a future shopping trip?
Most of us have received a free gift with a purchase at one point or another. These offers can be highly enticing for shoppers, providing just the push needed to buy an item. But how does giving out free merchandise benefit businesses?
In this post, we’ll dive deep into why offering free gifts with a purchase can be a powerful way to increase your sales, brand awareness, and customer loyalty. We’ll also cover gift-with-purchase ideas you can apply to your own business.
Key takeaways
- A gift-with-purchase campaign is a sales strategy where businesses offer customers free gifts in exchange for their purchase.
- Effective GWP campaigns have the potential to increase AOV for your store, increase brand awareness, and turn casual shoppers into loyal customers.
- The ideal gift is useful, valuable, or relevant to the customer and cost-effective for the business.
What is a gift-with-purchase promotion?
A gift-with-purchase (GWP) promotion is a type of sales campaign where brands incentivize customers to make a purchase by offering them a free gift.
Sometimes, these promotions are centered around a specific product. Other times, businesses will use this strategy to entice buyers to hit a certain purchase minimum. Typically, these campaigns have set limits around them, such as the duration of the promotion or the quantity of total gifts given out.
Key to the success of a GWP campaign is the relevance of the gift for customers. In other words, the “perfect gift” is one that is useful to the shopper and personalized to their needs and preferences.
The “perfect gift” is one that is useful to the shopper and personalized to their needs and preferences.
For example, an athletic brand might offer free socks when customers spend $50 or more on a new pair of running shoes, knowing that this item complements their existing purchase.
What are the benefits of free gift campaigns?
GWP campaigns are often used to increase sales conversions and delight customers. However, when carried out effectively, these promotions can have significant long-term benefits.
Results of a successful GWP promotion can include:
- Increased average order value (AOV)
- Boosted customer loyalty
- Greater brand recognition
- Higher customer lifetime value (LTV)
- Increased customer acquisition
How to select the best gift for your campaign
Many of the rules that apply to product selection for cross-selling also apply to product selection for GWP campaigns. As a brand, you want the gift to be exciting and meaningful enough for your customers that they’re encouraged to spend more with you. At the same time, you’ll want to make sure that these items are cost-effective for your brand to give away for free.
So, what makes a great gift idea? And how can you make your gift meaningful? One way to do this is to offer a practical gift—one that helps fulfill a relevant need for shoppers, and that they can use often. For example, if you’re selling a coffee machine, one gift-with-purchase idea might be to offer a free bag of dark roast beans with a customer’s order. You can also make your offer meaningful by giving out an exclusive, unique gift customers can’t easily find elsewhere.
5 best-in-class strategies for GWP campaigns
Once you’ve chosen the free product you’ll give your customers, keep these best practices in mind to deliver the most value in your campaign.
1. Choose your timing wisely
Campaigns don’t always last forever—they often come with limits in place. This makes your timing an essential part of your GWP strategy. You’ll want to consider both the time of year of your campaign and the duration of the offer.
The best timing for your campaign all depends on your products and the unique needs of your brand. Many businesses choose to offer GWP campaigns around specific holidays, such as Black Friday and Cyber Monday, Valentine’s Day, the Fourth of July, or Labor Day. If the products you’re selling are particularly seasonal, it may be wise to capitalize on the time that they’re most top-of-mind for consumers.
Alternatively, you may also choose to launch a GWP campaign around a slower season for your business. For example, if you typically make fewer sales in the warmer months, you might choose to launch a summer campaign to foster stronger year-round interest in your products.
Some GWP promotions, on the other hand, are more evergreen. Many companies will offer free gifts over an extended period of time for a first purchase to help customers get more value out of their order.
2. Clearly communicate promotion details
For any campaign, communication is crucial to set expectations. Customers should be able to quickly understand what it is that you’re offering and how to take advantage of it.
When advertising your promotion, make sure that you include details on:
- When the promotion is taking place (if it is time-sensitive)
- What products or purchase types are included
- What exactly the free gift is
- Any limits on the gift (e.g. “while supplies last”)
Use intuitive wording and showcase clear product photography to make your offer immediately apparent. Your customers should not have to work hard to find out what the free gift is—your communication should do the job for them.
3. Think about branding
Your word choice describing the offer should follow your brand voice and tone. This way, you’ll ensure that the campaign looks and feels like you. After all, you have a prime opportunity here to showcase your personality and make your brand stand out for any new customers who might be introduced to you via your GWP campaign.
If you’re giving out a free, physical gift, you may have other opportunities for branding as well. For example, if you’re giving out a free tote bag with a jewelry purchase, you have opportunities to include your brand logo in the design. While this can be a powerful way to increase brand recognition, keep in mind that the design of items shouldn’t make them feel like corporate gifts.
The unboxing experience of the gift itself can make it feel even more valuable for your customers.
Beyond your logo, you can incorporate branded elements into your gift via a personalized message included with the delivery, or custom gift wrapping. The unboxing experience of the gift itself can make it feel even more valuable for your customers and be a prime opportunity to showcase your brand’s style and personality.
4. Market your offer across key customer channels
Once the details of your offer have been determined, it’s time to communicate it across your various channels. Your goal here should be to ensure that the right customers find your offer at the right time.
Additionally, it’s important to strike the right balance when communicating your offer. Communicate it too sparsely, and you risk your customers missing the offer altogether. But communicate too heavily, and you risk pushing away your audience.
A few channels to consider include:
- Directly on your website: on product detail pages, your homepage, or within the customer portal
- Email newsletters
- Social media
- Video advertisements
- Blog articles
5. Track the effectiveness of your campaign with data & analytics
To gauge the success of your GWP campaign, it’s crucial to track its performance with data and analytics. Before the launch of the campaign, identify how well those products are selling, then track changes over the course of the promotion. You can also track new site visitors that discover your brand through the campaign, increasing your brand awareness even if they did not actually take advantage of the free gift offer.
By analyzing the data in this way, you maximize your learnings from the promotion, allowing you to tailor your future efforts more effectively.
GWP campaigns & subscription brands
Subscription brands are in an excellent position to offer GWP campaigns, as these promotions are uniquely primed for upselling. If you need a refresher, upselling is offering customers higher-priced, more premium alternatives to their original purchase—like purchasing an item on subscription instead of as a one-time purchase.
To use a GWP campaign to increase your subscription conversions, you could offer a free gift for a limited time for customers who purchase the subscription version of your product. You can even target your efforts around customers who have already purchased the item more than once and have shown their interest in repeat purchases of it.
Increase loyalty & sales with free gifts
Ultimately, gift-with-purchase campaigns are a powerful opportunity to communicate with your customers—to show them that you understand them and want to deliver them things that they value the most. By putting in the time to identify the right gifts for your unique customer base, creating clear and unique offers, and tracking performance over time, you can deliver greater value for both your brand and your customers.
