Making Gifts Out of Gift Cards

12:49 pm | Mark Yokoyama | Be the first to comment

Gift cards are a popular way to give a gift when you're not sure exactly what someone will want. They're also a great way for stores to boost business - it's kind of like the ultimate referral. In order to make them more gifty, gift cards are often packaged in a special box, bag or envelope.

But what if someone took gift cards one step further, and made them actually also gifts? As it turns out, a couple major retailers have done just that this year. Target has a gift card that is also a 1.2 megapixel camera, and Best Buy has a gift card that is also a functioning speaker you can plug into your iPod.

If you have a business who uses gift cards or certificates, why not make them more compelling by using an actual product? A customized wine opener, would make a perfect gift card for a wine shop or a pocket-sized aromatherapy stick as a gift card for a spa. Any pocket-sized item that relates to your business would make a better gift card than, well, a gift card. Plus, since there are so many items that are relatively inexpensive compared to the value of the gift card, even a small boost in sales will more than cover the cost. Chances are, having something way more interesting than a gift card at your point of purchase will boost gift card sales considerably.

The Power of Free

9:36 am | Mark Yokoyama | 1 comment

An interesting study mentioned in a recent New York Times article shows that, while most people like getting a deal, everybody loves free stuff. In the experiment, two tables were set up offering discounted chocolates: Lindor truffles for 15 cents and Hershey's Kisses for 1 cent. At this price, the Lindor truffles were chosen about 70% of the time. This would seem to make sense because the truffles are ostensibly a lot tastier and a great value at 15 cents.

Then, they dropped the price by one penny for each, and free Hershey's Kisses were chosen almost 70% of the time. This was true even when the tables were set up at the end of a cafeteria line and the 14 cent truffles could easily be added to the price of the meal.

The moral of the story? Cheap is good, but free is great!

Changes & Choices: Pharma Updates Marketing Code

9:47 am | Mark Yokoyama | Be the first to comment

The Pharmaceutical Research and Manufacturers of America (PhRMA) Board of Directors recently updated their Code on Interactions with Healthcare Professionals, prohibiting distribution of non-educational items (such as pens, mugs and other "reminder" objects typically adorned with a company or product logo) to healthcare providers and their staff. Despite their minimal value, the code states they "may foster misperceptions that company interactions with healthcare professionals are not based on informing them about medical and scientific issues."

Working for a promotional products company I'm surely a little biased, but this doesn't make a whole lot of sense to me. Under the updated code, pharmaceutical manufacturers can still treat doctors and other healthcare providers to expensive dinners, as long as they're part of an "educational" event. According to a study cited in the New York Times, at least 25% of doctors in the US have actually been paid by drug companies to lecture at events like these. Promotional pens and mugs must have an immensely powerful effect to be more influential than these types of dinner and lecture arrangements.

At the end of the day, I think the pharmaceutical industry is due for some reform. It's dominated by huge, immensely-profitable companies that use their clout to influence healthcare professionals and lawmakers. At the same time, I think they should be allowed to market their products responsibly. Promotional products, providing tangible, visible evidence of their marketing seem like a convenient sacrificial lamb, while drug companies continue practices that may be more deeply detrimental to the quality of healthcare than a free pen.

Made in the USA: Can we have it both ways?

1:50 pm | Mark Yokoyama | Be the first to comment

I was just writing a post on my blog about how difficult it is to be red, white and blue and green at the same time, which is what the planners of the Democratic National Convention are finding out. The more I think about it, though, there are quite a few options in my industry (promos) that are environmentally-friendly, but made in the USA and union made products are limited.

Now many folks who know much more than I have already written about this, but I still wonder, isn't it about time to stop pretending that buying made in the USA goods helps America? Over the last 15 years, suppliers in the promotional products industry have shifted almost all production overseas, mostly to China (although they do still print and embroider domestically). This has reduced costs, and our industry has prospered. 

So even though the average American has benefited greatly from globalization, when it comes to Presidential campaign promotion and a select few other (often political) uses, made in the USA promos are in high demand. Maybe it's time for candidates to drop the pretense and proudly use made in China campaign baseball caps and buttons. 

Obama's Fundraising Loss Leader: A Lesson for Business?

8:34 am | Mark Yokoyama | Be the first to comment

Today I received an email from the Obama campaign offering a free t-shirt for any donation of $30 or more. Although they surely do raise some money from this offer, with the cost of shirts and shipping it probably isn't that much from someone donating $30.

However, one of the reasons the Obama campaign has been so successful at fundraising is by aggregating small donations from many (over 1.5 million, I believe) supporters. One of the key benefits of this strategy versus getting maximum donations from fewer donors is the fact that small donors are able to give repeatedly over the course of the campaign.

So, with four months left to go in the campaign, there's a lot of potential lifetime value in new donors attracted by this offer. The low cost and high return on the first donation make them more comfortable taking that first step towards becoming a donor. As we move towards the election, the Obama campaign is likely to receive future donations from many of these new supporters as long as they can continue to give compelling reasons for people to remain involved and keep donating.

I think it's refreshing to see a sophisticated approach to fundraising like this, and I'd like to see it change how everyday Americans get involved in politics. I think there's also a great marketing lesson there for businesses - capitalize on the lifetime value of your customer and you can be more aggressive than you think to get people through the door the first time.

Promotion in a Slow Economy

8:25 am | Mark Yokoyama | Be the first to comment

I apologize for starting this blog on a bit of a down note, but tough economic times also represent an opportunity for savvy marketers to gain market share - both during a recession and after the economy recovers. It's already well-documented that companies maintaining or even increasing advertising during a recession benefit versus their cost-cutting peers. A down economy is also the perfect time to re-focus advertising and marketing efforts on targeted, trackable campaigns that deliver results. The benefits of learning to take a more disciplined approach to marketing and promotion can also drive future growth and profitability.

What does this mean for the average marketer? Take a close look at what you're currently doing and spend some time getting the best metrics you can. If you're under pressure to cut costs, try shifting your budget towards areas that have a higher proven ROI. By reorganizing your budget to maximize sales and profitablity, you're much more likely to be able to retain or even grow your overall budget - as long as you're able to clearly show the benefits to senior management.