Should you even be considering launching sales promotions right now?
That’s a valid question brand and retail marketers should be asking — especially since consumers are cutting their spend on many products.
But it’s apparent that consumers haven’t entirely stopped spending.
They’ve just changed the way they spend. Here are some recent stats on how consumer spending has changed:
- E-commerce sales reached $211 million in Q2, up 44% year-over-year.
- Target’s same-day pickup services grew 273% in the second quarter.
- Consumers are increasing spending on essentials and “COVID-comfort” products, especially in high-income households.
So, yes. You should be considering sales promotions right now.
And here are nine sales promotion techniques that’ll improve your revenue regardless of the pandemic:
[N.B: For the purpose of this article, “COVID-comfort” products are items that help consumers live through this corona season. For example, pizza and bath soaps are COVID-comfort products.]
1. Free samples of products useful during COVID
Free samples of “COVID-comfort” products are a great way to reach potential customers right now.
Since the pandemic started, 36% of consumers have tried a new brand. And 73% of them are likely to stick with it post-crisis.
So a free sample gets your product into the hands of consumers who are ready and willing to try something new.
Image Credit: McKinsey & Company
Regardless of COVID though, free samples usually drive incremental sales over a long period of time. This study in Marketing Science shows how samples can increase sales volume for up to 52 weeks.
That said, there are definitely some health and safety issues with free samples during COVID.
You need to consider disposing of single-use serving items, the workers and shopper’s safety, and managing crowds gathering around sampling areas.
Because of these considerations, many companies are getting creative with their samples. (Necessity is the mother of invention, right?)
The demo company EDS Strategy, for example, has gotten back into the sampling game by offering dry demos. They’re giving out small pre-packaged samples, talking with customers, and passing out coupons.
“Instead of making the oatmeal, we can give them a packet of the oatmeal that they can make at home and then offer a coupon to encourage a purchase of the full box,” said Jesse de Agustin, CEO of EDS Strategy.
Other companies are including samples with online orders. One way to do this is through Instacart; they can ask shoppers to add samples from Instacart’s brand partners at the end of the trip.
One company that did this is Justin’s, known for its organic peanut butter cups. They introduced their new Maple Almond Snack Pack using Instacart's sample program.
Other companies are operating along the same lines; fruit chip company Bare Snacks sampled bags of their Simply Cinnamon Crunchy Apple Chips. And Health Warrior, the protein bar brand, followed suit by offering their Coconut and Chocolate Peanut Butter Chia Bars.
Another creative tactic is moving your product demo outside. Breakfast cereal startup company Three Wishes did just that in early April.
The startup had relied on in-store demos at large retailers like Whole Foods and Wegmans to spread the word about their new product.
So when COVID hit, they needed another way to reach customers. The co-founders got creative and turned their u-shaped driveway into a drive-thru sampling station; complete with masks, gloves, and tongs for safety.
Video credit: Three Wishes
The unique sampling station was a success with cars lined up past their driveway and into the street during the hour-long event.
2. High-value rebate offers on COVID-comfort products
Image source: The Accidental Saver
The great thing about rebates during COVID is that they’re another way to replace in-store sampling.
Instead of handing out samples, you can offer customers a full rebate on new products; essentially letting them try it for free.
Sure, rebates aren’t usually that effective for lower-priced consumer packaged goods. It’s just not worth it to go through the hassle of filling out forms for a few bucks.
But what if you increase the rebate value and make it easy to redeem? And what if you sprinkle in some social media marketing to get people talking?
Well now, that’s one way you can change the game and improve your sales in this season.
Take a new food brand’s rebate campaign with Koupon, for example.
The new food brand needed to drive awareness and trial for their products. With in-store demos out of the question early in the pandemic, they had to think outside the box.
So, they partnered with Koupon (that’s us) to deliver a high-value rebate offer promoted on various digital and social channels.
- We created a fully branded rebate using our mobile offer technology platform. This platform is a secure, easy-to-use toolset that allows brands to reach consumers on any digital channel.
- The rebate was available to use at any retail location, no downloads or registrations required.
- Consumers immediately received cashback in their PayPal or Venmo account after sending a picture of their receipt as proof of purchase.
Then, Koupon rolled out a social media campaign for their rebate promotion. Here’s a brief description of what it looked like:
- A keyword text-in promoted during a podcast interview with the brand’s CEO.
- A keyword text-in promoted by influencers during Instagram takeovers showcasing their products.
- A link to the rebate that lived on the brand’s Instagram page for consumers to use throughout the campaign.
The results? A whopping 91% conversion rate.
By combining influencers with rebates to sell a COVID-comfort product, they converted followers into customers, successfully trialing a new product without in-store samples.
3. Discounts or price reduction on COVID-comfort products
Discounts are still another great promotional tool right now.
Because economic insecurity is leading to recessionary behaviors like reduced spending and price sensitivity, budget-conscious consumers are looking for deals.
They don’t want deals on just anything though, because lifestyle changes from quarantine, remote work, and virtual school are transforming consumer preferences.
So products that are relevant to our new lives at home are in the highest demand. We’re talking about things like fitness equipment, hair dye, desk chairs, loungewear, snack food, etc.
Here are a few examples of recent campaigns that hit the nail on the head with discounts on COVID-comfort products:
But what if you’re targeting in-store shoppers?
Thanks to innovative technologies, you can promote discounted products to shoppers in-store. Case in point: Koupon’s mobile offer technology delivers discount coupons using digital retailer channels and in-store signage.
Another kind of discount (uniquely suited to the pandemic) is a charitable discount promotion. With this type of discount, the promotional savings are directed towards a cause. This encourages conversions (sales) because customers can buy for themselves while still helping others.
Here’s an interesting example from LARQ:
4. Limited-time offers on COVID-comfort products
Limited-time offers are great right now because they create a sense of urgency.
Many people stuck at home feel as though one day just blends into the next. Unless you need critical supplies, there’s not much reason to buy today vs tomorrow.
And like the other promotions we’ve talked about, you’ll have more success if you focus on relevant products. Here’s an example of an offer at Lowe’s that’s only available for a limited period of time:
But this Lowe’s ad also brings up an important caveat about limited-time offers during the pandemic: you need to choose your words carefully.
While you want to create urgency, you don’t need to over-do it. After all, nothing is more urgent than COVID. Using scarcity-driven or FOMO phrases like “Don’t miss out” can come off as a bit tone-deaf given the current crisis.
Here’s an example from Athleta showing a sympathetic extension of limited-time offers:
And here’s a good example of a limited time offer using Koupon’s mobile technology. It features a deadline to create urgency but doesn’t use any pushy phrases.
5. Free gifts that are useful during COVID
Image source: @gethuel on Twitter
Free gifts (or premiums) are another useful consumer sales promotion right now.
And they have a long list of benefits when used effectively. They can:
- attract new customers
- increase impulse buys
- build customer loyalty
- improve upselling rates
And during COVID, impulse buys on small items are especially hard to come by as more and more consumers are shopping online instead of walking the aisles. That extra pack of cookies is a lot easier to pass up when you’re at home instead of hungry at the store.
But even in-store, impulse buys on consumer packaged goods are down these days. Consumers are on a mission: get in and get out as quickly as possible.
So, you need to up the ante a bit. And offering a free gift with purchase is a great way to get those impulsive juices flowing.
Here’s an in-store example from Coors Light. They packaged a 36 pack of beer into a cooler bag just ahead of Memorial Day. The cooler bag gift incentivizes a larger purchase of a 36 pack vs the standard case of 24.
Upselling is another area that’s important during COVID. You can offer free gifts with a certain dollar amount to incentivize customers to buy more. Take a look at this gift offer from bareMinerals:
Free shipping is another form of a “free gift.” You can offer free shipping with a certain dollar amount to encourage customers to add more to their cart. Check out how this shopping cart shows how far away you are from “earning” free shipping:
Finally, the luxury razor company Supply rarely discounted its products prior to COVID. But when sales plummeted in the spring, the brand decided to give it a try. They went through a few promotions before landing on one that struck a chord.
Buy a razor and get a whole year of blades for free…
6. Buy-one-get-one-free on COVID-comfort products
Image source: simcase.ru
Here, you have the classic Buy One, Get One (BOGO) offer.
This type of promotion is typically used to move inventory. And while it’s technically the same as offering 50% off, it’s often more effective psychologically.
BOGO is particularly effective during COVID because it plays on our desire to “stock up” during the crisis. You can make an emotional connection with the consumer by conveying that the offer is intended to help out during the pandemic.
In this offer from Hair Craft Co., for example, they say “We understand that COVID-19 is impacting us all. Buy one Product and you’ll get a Product of your choice free.”
And this offer from Love Wellness uses the code “HERE FOR YOU” to convey the message of being in this together:
7. Loyalty rewards
Image source: score.org
Loyalty programs are great because they build brand preference without affecting the price point. They also collect customer data and valuable ROI information.
But during COVID, loyalty programs are even more important. Research by McKinsey shows that 75% of shoppers have tried a new brand since the pandemic started. With so many items out-of-stock in the spring, desperate shoppers reached for new brands to fill their pantry.
Now that things are stabilizing, you need to get those customers back. According to Total Retail, “This is the time to review loyalty initiatives and ensure value propositions are focused on creating real relationships with consumers in order to successfully re-emerge from COVID.”
7-Eleven ran a creative campaign over the summer to draw people into its rewards program. The national c-store’s busiest day of the year is always July 11th (7/11) Free Slurpee Day.
But with social distancing restrictions in place, 7-Eleven decided to offer free Slurpees for the entire month with a coupon. Customers redeemed the coupon by signing up for the 7Rewards loyalty program.
Another good loyalty campaign is Coke’s “sip & scan” program. Customers can scan barcodes on soda bottles to automatically redeem rewards and points.
Speaking of Coke, here’s an example of another type of loyalty program.
Similar to the charitable discount, charitable loyalty rewards allow customers to give back rather than redeem personal prizes. Many customers will remain loyal to a brand in order to participate in this type of program.
8. Same-day delivery
Same-day delivery is now a critical service; especially for items like groceries and pharmaceuticals. The fact is, many consumers still can’t get to the store or would prefer not to.
This chart from McKinsey shows how it’s important to meet your customers where they are. And expanding home delivery options is an important piece of the puzzle.
Same-day shipping is an incredibly valuable customer experience right now. And when things begin to “normalize,” many consumers will stick with those brands or retailers that made it easy.
Data from the 2008 recession shows that focusing on customer experience is a winning strategy during economic downturns. In fact, customer experience leaders during the Great Recession had three times higher returns compared to those who lagged behind.
A great example of this is Target’s partnership with Shipt. Remember that 273% growth Target had in the second quarter? Same-day pickup and delivery was the driving force behind that number.
9. Location-based free shipping
Location-based shipping is another promotional tool that can be used to your advantage during COVID.
You can offer free shipping to customers in a specific geographical area. This provides customers with an incentive to buy while saving you shipping costs.
According to ShipBob, the 3PL shipping company, “fulfilling orders closer to your customers helps you reduce shipping costs and the time in transit. This makes fast options, like 2-day delivery, more affordable by using ground shipping instead of expedited air — a strategy used by companies like Amazon.”
One thing is for sure, COVID is changing consumer behavior at a rapid pace. Preferences are shifting and recessionary spending habits are setting in.
But while spending is down overall, it’s up for essential items and COVID-comfort products.
There are many sales promotion methods that can be used for increasing sales during this time:
- Free samples
- Limited time offers
- Free gifts and giveaways
- Buy One Get One
- Loyalty rewards
- Same-day shipping
- Location-based free shipping
These different types of sales promotions work well in the short term as we deal with the pandemic. But they also work as part of a long term marketing strategy.
So which one will you be implementing?