• You will hear part of a talk to a group of business students about the role of free gifts in product promotion. • As you liste

Woman: Hello. My name’s Sue Barnard. I’ve come to talk to you this afternoon about that old marketing perennial, the free gift. I work as a marketing consultant, on a freelance basis, and I thought that I would begin with an anecdote. One of the companies I work with is a major manufacturer of consumer durables, and so I need to keep in touch with the latest campaigns being launched by rival groups, as well as seeing how our own efforts are looking. So I’m a keen reader of weekly magazines.
   Although I’m actually based in Manchester, last week I happened to be with some clients at their sales conference, which was being held in Wales. On the way there, waiting at the station, I popped into a newsagents for a browse, to pass the time. The March issue of Prime magazine immediately caught my eye because the cover said ’Free Gift this Issue: Free Diary’. And it puzzled me because I had seen the same issue on sale in Manchester without any gift. Clearly, people in Wales were getting the same magazine, but all packaged up in a special plastic jacket with this gift inside. Why, I wondered, were people in my area losing out?
   Well, of course, the answer lies in the marketing policy of the magazine itself. No use giving everyone a freebie because then there’d be no way of gauging how successful it’d been in drumming up extra sales. In other words, it’s a controlled experiment. In this case, flat sales of Prime in Manchester, coupled with strong sales in Wales, would indicate that the gift had done the trick, and this type of strategy is vital for magazines as more and more titles crowd the racks.
   Just looking round the newsagents this week, you’ll find one magazine giving away a book worth six ninety-nine, when the magazine itself only costs two ninety-nine. And it doesn’t stop there. One rival is offering a CD, another a calculator. And so it goes on. You know, it really is a ’readers’ market at the moment.
   But, I can see you’re asking yourselves, if the gifts are actually far more expensive than the magazines...? Well, clearly, the magazines are facing greater competition and it’s all about offering your reader the best possible value. If your competitor’s got something out, then you don’t want to be seen to be lagging behind. And once you’ve started, in a sense, you’ve got to keep on - you do get locked into a ’circulation war’ where the only way to stay on top seems to be through the free gifts. And remember, it doesn’t matter if the gift costs more than the magazine because the real profits come not from the cover price, but from the advertising revenues. To keep those flowing in, you need good figures, and that’s where the free gifts come in.
   And, of course, it can’t be any old gift. An inappropriate choice would do more harm than good. The gift must reinforce the true brand values of the magazine. The specialist titles are particularly good at this. And it’s also a good opportunity for people to sample your magazine; it may bring in new readers. With the right gift, you could even be looking at as much as fifteen per cent uplift on your sales, particularly in the teen market, where pop fashions come and go and it’s very important to encourage reader loyalty.