Explaining Gift with Purchase in Marketing: What You Need to Know

One supermarket shelf, similar prices, ten different cereal brands, which one would you get if you have no personal favourite? Many customers would go for the one with value-added – the cereal pack with a branded bowl attached, just the right size for a portion. Such gifts with purchase are nothing new, but they remain a win-win all the same.

In this case study, the tape packaging is too flimsy to hold the gift with purchase firmly to the promotional product. This poor design may cause the GWP to fall off during transport and purchase, causing a negative customer experience. We can help brands design functional and eye-catching packaging for this type of GWP.

So, what does a Gift With Purchase (GWP) mean in Marketing?

 

Gift with purchase (GWP) is a marketing tactic where businesses offer customers a free gift when they purchase a specific product or spend a certain amount. GWP promotions can be used to increase sales, attract new customers, boost brand awareness, and clear out inventory.

The concept is simple: when customers buy a specific product or spend a certain amount of money, they receive an additional item at no extra cost. This extra item can vary widely, from small accessories or samples to more substantial products.

Key aspects of GWP promotions:

• Relevance: The gift should be relevant to the target customer and the promoted product or service. For example, a clothing retailer might offer a free reusable shopping bag for purchases over $50.
• Value: The gift should be perceived as valuable by the customer. It doesn’t have to be expensive, but it should be something the customer wants and will use.
• Exclusivity: GWP promotions are often more effective when the gift is exclusive or limited-time only. This creates a sense of urgency and encourages customers to make a purchase sooner rather than later.

Example:

A beauty retailer might offer a free travel-sized skincare set with any purchase over $100. This promotion is relevant to the target customer (beauty enthusiasts) and the product (skincare products). It is also perceived as valuable, as the travel-sized skincare set is a convenient way for customers to try new products or take their routine with them on the go. The exclusivity of the promotion (only available for a limited time) encourages customers to make a purchase sooner rather than later.

The ODM Group has dozens of case studies and ideas for gifts with purchase.

Benefits of a Gift With Purchase Strategy

GWP is a great marketing strategy for physical products. Here are its benefits of gif with purchase:

• Boost Sales

When there is no personal preference, and the prices are competitive, customers tend to go for the GWP products for the added value of getting a free gift.

For example, Sunsilk’s on-pack promotion offered a free mini massager by Ogawa bound together with two large bottles of Sunsilk Co-Creations.  The massager is a pricey item when bought separately, so many customers would see this as a valuable bonus.

• Enhance Customer Loyalty

For loyal customers, getting a branded gift with their normal purchases is a quick boost of loyalty. Unique branded gifts, included in gift packages, are a nod to the customers’ continuing support and pride in owning your products.

For instance, Sephora Poitiers in France promoted their products with a branded mini plastic bathtub as a cosmetics display and storage. This durable gift can be kept in anyone’s bathroom as a unique reminder of the brand right where the products are often used.

• Encourage Impulse Buying

Customers may buy more and buy more impulsively when they perceive the gains are greater than the spending. Many gifts with a purchase have a market price equal to or higher than the product’s price, giving the positive impression that the customers get a good deal even when they have no intention of buying it.

A suggestion: a pet store can offer a custom air tag case for any purchase over a certain amount. Fur parents would love to have such a useful accessory for their pets.

GWPs that provoke impulse buying are often well-designed and novel, encouraging the desire to collect without needing to use it right away. The ODM provides concept sketches that allow you to try out different ideas and innovate creative and thoughtful products for your GWP marketing campaigns.

Concept sketches are particularly useful for designing colour pop accessories, such as the fun phone cases and bangles in the above photo. These vibrant and colourful designs can stand out on the shelves and catch the eyes of even the busiest customers. The ODM has the capacity to bring design concepts from sketches to the final products, making sure the colours of your choice stay true to the original sketches.

• Introduce New Products

A new product can find its way into the market as a gift with purchase. By doing so, the new product can gain exposure in the market, increase consumer awareness, and capture new customers.

A case study: Kilkenny Design Center promoted their new ovenware range by offering a jug and bowl set – designed by the artisan Nicholas Mosse – for spending above 140 euro.

• Build Brand Awareness

A new brand or a brand pressured by heavy competition can seek to stand out with gifts with purchase. To gain the best exposure, choose a gift that complements nicely with the product or suggests a new way to use the product.

For example, a kitchenware brand can introduce a silicon cling film substitute that fits their food containers perfectly. This solution to plastic cling film will cement the brand’s eco-friendly image.

Moreover, brands can also form collaboration with other brands by offering their new products as gifts with their partner’s products.

In this case study, Sanrio and Thermos paired up to offer Hello Kitty flasks to customers who had earned enough stamps from their purchases of healthcare and skincare products.

 

• Clear Excess Inventory

Some gifts with purchase have a former life as accessories to the main product range. Otherwise, you may have slow-moving products taking up valuable space. Giving them away as gifts with high-value purchases is a good way to avoid waste and discounts; at the same time, you give a boost to your brand.

We, the ODM group, can provide specialist advice on how to avoid dead stock merchandise in the first place.

 

Tips for Running Your Gift With Purchase Marketing Campaign

Here are the steps in setting up a gift with purchase campaign:

1. Set Clear Goals

What do you want to achieve with your gift with purchase promotions? The common goals are:

• Boost sales of products that have a lot of competition
• Increase brand awareness of new brands or a rebranded product
• Promote a new product that is joining your mainstay range
• Reward customer loyalty with thank-you gifts

Your campaign strategy depends on the goals. The clearer the goal is, the easier and smoother it is to plan your campaign.

2. Know Your Customers

How do your customers use your products? What are their pain points that can be addressed with a useful gift?  Or, what do they most like about your product, and how do you make it even more attractive?

Loyal customers want to flaunt the products they love. Thoroughly research their behaviours and preferences to pinpoint the gifts that speak to them.

3. Choose The Right Gift

This is imperative. If you don’t have excess inventory to clear out or a new product to introduce as gifts, then taking some time to brainstorm the gifts with purchase will give you options in cases where the gift production does not go as planned.

Make a list of gifts that are:

• Relevant e.g. a product sample, a useful accessory
• Valuable e.g. exclusive merchandise
• Engaging customers to participate in the bigger promotional campaign

4. Set Minimum Purchase Requirements

The best way is to determine the specific products that qualify for the gifts. This is particularly effective in boosting sales of products that are normally slow-moving or less competitively priced.

You can also set a minimum purchase amount to encourage customers to spend more to get the free gift. However, this may not entice price-conscious savvy customers who realize buying the gift at the market price may cost them the same amount of money. Always know your customers.

Another solution is to give your gifts attractive visuals and copy that stands out on the shelves, qualifying them as collectables.

5. Highlight The Promotion

Time to spread the word about your gift with purchase. Create a promotional calendar with well-timed updates on your website, social media, email newsletters, and in-store displays. Make the best use of on-brand visuals and copy – wow your customers with a pleasing experience.

An important part of a seamless customer experience is unique product designs. With decades of experience, the ODM group can help you customize your promotional products to make them worth a collectable in their own right.

The strong design assistance from the ODM group and our marketing arm Mindsparkz would make sure your gifts with purchase have eye-catching and functional designs that stand out on the shelves.

6. Create a Sense of Urgency

Depending on your goal, consider placing a time limit on the gift offer. Limited offers create excitement around the products, invoking a sense that the customers are not just buying a regular product; they are also participating in an event.

7. Provide Clarity in Terms and Conditions

Many gifts with purchase are attached to the products, so their availability is straightforward. In cases they are not, remember to include transparent terms and conditions in all your promotional materials. This includes training your staff, especially for in-store promotions, so they can effectively answer customers’ questions and potential complaints.

Transparency and clarity are particularly important to build customer loyalty. A loyal following is cultivated with clear messaging, a unique brand voice, and keeping your promises to the customers.

8. Monitor Inventory

Make sure the gifts and the products match each other in stock to avoid overselling or running out of stock during the campaign.

9. Measure Results

Evaluation is essential at two stages:

• When your campaign is ongoing: follow up on customers’ feedback and promptly address any issue.
• When your campaign ends: assess performance.

Assess the impact on sales, customer engagement, and brand visibility. Use the insights gained to refine future marketing strategies.

By incorporating these tips into your gift with purchase campaign, you can maximize its effectiveness and create a positive experience for your customers.

 

Make Engaging Gifts With Purchase With Us!

Everyone loves gifts; your customers too. Gifts with purchase are so common and effective that it is a no-brainer for your marketing effort. Aim to run GWP campaigns at least once per year, especially around festive seasons when your customers often buy gifts.

We are a one-stop marketing agency that understands the value of GWP, with the industry know-how to make your campaigns successful. Contact us to get more expert explanations and assistance for your next GWP design and manufacturing.

 

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