THE DECISION TRIGGER:  FREE!

Never refuse a good offer.”
-Proverb

Another secret key to the success of a DRTV commercial and direct marketing campaign can be summed up in one word:  FREE!   

Let’s face it, people want something for nothing—it’s just human nature.  Therefore, when you are selling a product or service, if at the same time, you give something for FREE; it will generate the “buy” emotion in a prospective customer.  Based on my experience, this is an invaluable marketing tip, and will undoubtedly create more sales than anything else I could tell you to do. 

No matter how low the price of the offer, no matter how much the savings or discounts that are offered, a FREE offer, bonus or gift will significantly increase the results. 

IT’S A TWO-WAY STREET

Also, by giving the primary target buyer something for free, he/she will feel gratitude—you will have created a desire for reciprocity.  In other words, if I buy you lunch today; you will feel the need to buy me lunch the next time.  If I give you something for free, you will feel obligated to give me something back in return.   I call it the “give and gain principle” and it applies to the advertising strategy you can employ.  If you give something of value without obligation (free information or a free gift), the recipient will experience a sense of “wanting to give back.”  It creates an unspoken obligation, and this “law of reciprocity” is automatic and instant when used in a DRTV commercial.

Thus, if the free item is of a high enough perceived value; it will become the catalyst for the impulse buy.  Sports Illustrated magazine is a good example of this practice.  They offer FREE to any new subscribers, the free swimsuit issue, along with a FREE Video.  In their DRTV advertising, the FREE video is usually the focus or the featured part of the commercial.  And since it has a high enough perceived value, potential subscribers order just because of these give-away items. (People want the swimsuit issue and the video as much or more than they want the magazine!)

FREE BONUSES CONVERT MULTI-PAYS TO ONE PAYS

One of the most popular ways to generate additional sales is to offer the product or service on a 3 Easy Payment Plan basis.  For example, the most popular price point for multi-payments is “3 Easy Payments of Only $29.95”.  In order to convert these multi-pay customers to a single credit-card payment, all one needs to offer them is something during the in-bound telephone call, i.e. something for FREE!  I have discovered that a “free video” or “free gift” offer, usually valued at $15 to $25, will convert these multi-pay buyers to a single payment approximately 75 to 85% of the time.  And the difference a single payment makes in ones cash flow can be the difference between the success or failure of your advertising campaign. 

TWO-STEP APPROACH

This simple but effective marketing technique has been the most successful one that I have ever created for DRTV spots and Infomercials.  FMS Direct has generated nearly one billion dollars in sales revenues for its clients using this two-step approach.

Approximately 850,000 individual investors responded to our DRTV spots and Infomercials when they aired regularly for five years on the Financial News Network (FNN).  The majority of these responses were generated from a FREE Offer which ranged from a prospectus, a special report, a free guide, a free brochure, to free audio and video tapes.  The leads (qualified prospects) would then be distributed to the client’s in-house sales force for follow-up.  Follow-up, they did.  Converting an overall average of about 10% of the leads, and with a minimum investment of almost $10,000, these clients generated approximately $850 million as a direct—and indirect—result of our Infomercial lead generating marketing campaigns.   If you are looking to convert your prospective buyers (inquiries) into customers, offer them something that has value and selling power (a selling brochure or a Direct Video), and give it to them FREE.

Let me give you some examples of how to use this most potent word “FREE” using the two-step approach.  The first examples are rather obvious—some products or services even require it, i.e.  Kemper Financial offers a FREE booklet on one of its mutual funds (step 1) and then follows up with a direct mail piece or a telephone solicitation (step 2).  Thus, Kemper needs to send the prospect something FREE.  Bear in mind that the two-step approach always requires a follow-up to the inquiry.

As a general rule, a two-step approach is preferable when offering a product or service that has a price point of more than $200.   Again, the FREE Offer could be any of the following:  a special report; information; a guide; an audio tape; a videotape or DVD; a brochure; a discount coupon book; a gift, and so forth. 

A GREAT SELLING TOOL:  FREE INFORMATION

In 1990, FMS was commissioned to help sell Oldsmobiles.  We created and produced three DRTV commercials to test which one was the most effective and launched the campaign with phenomenal results.  After we went through the process of testing, measuring and adjusting, “TMA”, we selected one of the commercials and determined the specific media outlets for the launch.  The one selected “out pulled” the others by a 4 to 1 ratio.  (Remember my earlier advice to always produce more than one commercial).

The DRTV spot that we determined to be most effective had a production style and marketing technique known as a special “Newsbreak “ spot.  (We had utilized it in the past with great success for our financial clients advertising on FNN).

Here’s how this one worked:  It was called, “Automotive Report” and the host was Mario Machado.  The concept was that Mario, as a news reporter, was presenting some very “hot,” timely and newsworthy consumer information. Through our testing we had discovered that the audience responded most to the FREE information that we were offering in all the commercials.  So in this “Newsbreak” spot, throughout Mario’s entire presentation, the value of this free information was featured.   This was also predictable from our previous marketing research and our experience with giving valuable information away for Free.  Remember this:  If you have a free give-away that increases your response by multiples, then write your copy and make your entire presentation around the free information.

For this Oldsmobile commercial, we co-created the collateral material, (a FREE consumer’s guide) and titled it “The Smart Buyer’s Guide.”  Again, through our research we learned what car buyers were concerned about when shopping for a new car.  Because this special guide exposed all of the problems and what to beware of when purchasing a car, it was truly an advocate of ethical buying.  This in turn, created a sense of credibility in our presentation. 

As Mario began his 60-second “report”, he immediately spoke about the FREE consumer’s guide for new car buyers and reported on the benefits that could be derived from it.  He mentioned the fact that supplies were limited (the scarcity rule) and that it was available at no cost or obligation to the viewer. This generated a sense of urgency, i.e. the need for an instant response. 

Another important selling component was that the “Smart Buyer’s Guide” would benefit everyone who read it, and acted upon it, regardless of what kind of new car they were shopping for.   The “Rule” here is that whenever possible; always give valuable information to your prospective target market, even if they don’t buy from you right now.  You may not sell them this time, but they will never forget you gave them something of value (Law of Reciprocity), and gave it to them for free.  You are building goodwill for the future.

The bottom-line result of this two-step marketing strategy was the phenomenal increase in car sales that it generated—more so than all other forms of advertising.  Again, remember this important tip:  If you ever have a great FREE give-away (of high perceived value) that people want, then create the copy for the entire commercial around that “gift”.  In the case of Oldsmobile, FMS Direct increased the sales of new cars in one dealership by 60% during the next several months. 

By the way, before producing a “Newsbreak” type commercial, get approval from the media outlets where you are planning to place the spots.  In some instances, this format is not allowed because of the perception of it being too much like a “news” program.  (This is especially true if it is a half-hour Infomercial). 
I urge you to be creative and think of a FREE offer that your primary target audience would really like to have.  Believe me, there’s no limit to the kind of FREE information you can make available at no charge.  But once you send out this free information, make sure it includes something of real value.  My advice is:   give people more than they expect! Under promise and over deliver! 

ONE-STEP APPROACH

A one-step marketing approach can also successfully utilize the word FREE when making a direct sale of a product or service. This type of commercial requests the viewer to pay for the product now, either by mail or with a credit card, via telephone or website, but it also offers something of value for FREE by calling or logging on now.  The respondent is acting on impulse to order something and many times is “won over” by the FREE Offer that accompanies the product or service. 

For spot advertising, this one-step marketing approach is generally preferred when the price point of the product or service is less than $39.95.  However, if your product is highly regarded, or has additional exposure in other forms of advertising and the commercial is placed in a targeted media, (i.e. a financial product on a financial media outlet), it is possible to use this approach with a higher price point.  However, above a $39.95 price point, I generally recommend that the product be marketed via an Infomercial—the long form of DRTV.

Let me give you some examples of the FREE information offer in a one-step advertising campaign. When launching the direct response TV ads for Investor’s Business Daily, a competitor to the Wall Street Journal, FMS tested various FREE offers with the newspaper’s trial subscription:  “Call Now 1-800 and you will receive a 12-week trial subscription of Investor’s Business Daily for only $34.00.  Save $X off the newsstand price.  And when you Call Now you will also receive this FREE bonus book and audio tape entitled, The Ten Best Stock Picks For The Year.”   Please note:  we were including a FREE audiotape with a bonus book gift.  This not only delivered more immediate sales, it kept the subscriber for longer periods of time. 

When offering Howard Ruff’s financial newsletter, Ruff Times, FMS lowered the annual price by 25% from its original $119 price to $87 and then offered a FREE special report.  In a direct response TV commercial all magazine offers include a FREE gift or bonus.  Why?  Because it works.  It provides added value for less cost.  It gives the buyer the intended realization that they are getting extra value at no additional cost.  But never forget that the free offer must provide perceived value in order for it to work over the long term.

Pearl Cream, a skin care product was being sold via two-minute DRTV spots hosted by Nancy Kwan. The price was only $19.95, but the product was still not selling very well – until a FREE and irresistible offer was added to the commercial.  The DRTV spot was rewritten and now used the first 30 seconds and last 20 seconds to “sell” a FREE report, called, “Oriental Beauty Secrets.”  This premium sold the benefits of owning the product and gave it away for free.  Once this had become the primary focus of the commercial, the product took off!  Overnight, its sales had quadrupled!

JUST DO IT!

Create a booklet or some collateral pieces of useful information that a large percentage of your primary target audience wants or needs.  Try subjects or topics that are trendy, popular or hot.  Come up with a great title—one that can be a short commercial in itself, incorporating many of the key selling elements of the product or service right in the title and sub-title.
Just remember that the product offer has to motivate the viewer to act, now!  You need to offer something so irresistible that the consumer will have a compelling reason to get off their coach go the telephone or website and order it now.  You need to create so strong an emotional response within the potential buyer that he or she is moved to take immediate action.  It cannot be stated strongly enough that you must create an irresistible offer – one that appeals strongly to their emotional buying triggers (fear, greed, shame, guilt, prestige), AND give them a logical and compelling reason to do it NOW!

“Call Now 1-800 -  How to Profit from Direct Response Television Advertising”  Copyright 2006  Rodney H. Buchser

Copyright   FMS Direct All Rights Reserved