The Free Lunch is a sales tactic has been around nearly as long as there have been American businesses to begin with. Before jumping on the band wagon for this popular sales tactic, make sure you understand the logic of the Free Lunch and how to properly leverage it for your business. Let’s begin by exploring the early history and logic of the Free Lunch sales tactic.
The Invention of the “Free Lunch” Tactic
Popularized in saloons, the idea of “a free lunch” was to get people through the doors, into a chair, and buying drinks. Lunch was offered as a gift with purchase of one drink with the idea that the average person wouldn’t stop at one drink. While enjoying their meal and socializing, they would likely consume a great number of spirits, which would ultimately be greater than the value of the lunch, and making the saloon owner a profit.
This sales gimmick has been used throughout history and across many different industries, and is especially favored by casinos who offer the occasional free play (and free drinks!) as a way of getting people to gamble more. Born of this popular sales tactic is the expression,“There ain’t no such thing as a ‘free’ lunch.” It hopes to remind people to consider the associated cost with getting one particular item for “free”. There is almost always a hidden motivation behind the offer. It cannot be disputed, however, that the American public simply loves to get something for free!
Making The “Free Lunch” Tactic Work For You
If you plan on offering something for free, there are several measures you should take to ensure your promotion is not taken advantage of. The popularity of Free Lunch promotions has lead to a increased number of people who only look to take advantage of weak or unprepared promotions. Ensure you have all the proper rules in place, and clearly state the limitations on the offer.
Here is a good checklist for any Free Lunch promotion:
- Date Range. In order for a customer to qualify for a promotion, he or she must make a purchase during a set period of time. The free offer has a start and end date. It expires once the end date has passed.
- Promo Code. A specific promo code entitles a customer to a gift. This is preferable for online merchants although some brick-and-mortar businesses still use this sales tactic to keep track of the different promotions they offer throughout the year.
- Product/Quantity. The product/quantity promo is popular with restaurants who often offer a free drink or food item after a specific number of purchases. It’s also an incentive to get people to purchase a set amount of goods or services as a way to clear out excess inventory and make room for new merchandise.
- Subscription Program. Magazines are notorious for giving away gifts with subscription purchases. The same can be said about monthly subscriptions popularized by companies like Conscious Box who give away the first month’s box free minus the cost of shipping and handling.
- Order Total. A free gift is provided whenever a customer has spent a specific amount of money on products and services. This helps boost sales by hitting projected targets quickly and without extra advertising.
Free Lunch promotions always involve some costs, and if abused could result in dramatic losses for the business offering the product. It’s important to have a concrete plan in place before establishing your promotion. You should know exactly who you hope to target and how you want to execute your Fee Lunch campaign. The word “free” has a great deal of power. Use it to your advantage and turn a sales tactic that has been used for years into something profitable for your own small business.