Sales Promotions
While they may attract customers today, they don’t build loyalty
If they come to you for price, they will leave you for price.
*note: the same applies to gifts, freebies, etc.
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Lock-in alert
And may even pose a reputation risk for your brand
Trade your reputation for a short term sales fix?
A 2011 study by John Byers and Georgia Zervas from Boston University and Michael Mitzenmacher from Harvard University reviewing 56,000 yelp reviews of 2332 merchants offering 2496 Groupon deals
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My case
Start focusing at least 25% of your efforts on sales promoters
Keep doing “smart” sales promotions, but start shifting your attention.
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My case
Sales promoters are so happy, they actively promote you
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The sales promoter
An illustration of the impact sales promoters can have
Video
http://youtu.be/b0OeM6UUAoI
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The sales promoter
An illustration of the impact sales promoters can have
“I’ll have what she’s having”
Sales promoters get others to buy your product
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The sales promoter
But there is more beyond advocacy
Customers that are so happy they are likely to recommend a company
spend morenegotiate less
stay longer as customersare more open to upsellingare easier to service
upgrade quicker
are ready to refer to othersincrease staff morale
etc.
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The sales promoter
How likely are you to recommend?
Detractors: Dislike |
Passives: Satisfaction |
Promoters: Delighted |
0 |
1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
9 |
10 |
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The sales promoter
Case: an automotive brand
€ 15,000
Detractor
Promoter
- € 1,500
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The sales promoter
Case: UK FMCG
Leading by recommendation, July 2010
120 Brands – 4000 consumers
TOP 5 Most actively recommended FMCG brands in the UK
Activia |
76,9% |
Kellogs Special K |
76,0% |
Innocent |
74,2% |
Lucozade |
72,7% |
Red Bull |
72,2% |
“55% of FMCG consumers had made at least one recommendation”
A 7% increase in NPS = 1% increase in FMCG Growth
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