How Promotional Merch Upgrades Customer Loyalty
Sports enthusiast “Sally” has just received her first order from Hammer Nutrition Inc. It’s a box filled with nutritional supplements and sports endurance from the small, but long-standing endurance sports supplements company, based in Whitefish, Montana.
Like many small companies, including yours maybe, Hammer engages customers like Sally to be brand ambassadors. Sally is one of hundreds of athletes Hammer engages to spread the word about their products and company. This was her first order and she was thrilled to see the gels, powders, pills and sports bars stuffed in the FedEx box.
But what really delighted her was the free Hammer crewneck T-shirt and two water bottles emblazoned with Hammer’s infamous jackhammer logo also tucked inside the box.
On her shipping receipt, it read, “Thanks ‘Sally’ for referring a friend to Hammer. Here’s a free T-shirt! Hammer On!”
Research has proven that given out promotional products to customers can boost your bottom line and build brand loyalty, but Hammer and other companies offer a new twist on an old marketing tactic–let’s call this Strategic SWAG.
SWAG and Brand Ambassadors
Sally is what we call a “brand ambassador.” She gets a discount on products from Hammer in return for Tweeting, Facebooking and posting pics on various social media outlets describing her Hammer experience. She also gets discount codes to pass around to her friends.
Hiring brand ambassadors is common place among big and small businesses alike. But giving Sally a free T-shirt AFTER one of her friends used a discount referral takes Hammer beyond the normal promotional products territory into the deeper psychological construct known as The Rule of Reciprocity.
Reciprocity basically means we social animals can’t help but to reward a favor with a favor. In the scenario above, Sally bought Hammer products. She referred a friend. So Hammer gave her a free Tee. But it isn’t Hammer that is practicing the reciprocity principle. It will be Sally. And, of course she did.
— Kris and Mindy (@RaceEveryStep) February 28, 2015
Less than one hour after receiving the free T-shirt, Sally’s Facebook timeline was filled with pictures of Hammer’s products but also pictures of her in the new T-shirt. Complete with a “Look at my new Hammer T-shirt…woo hoo!” Sally couldn’t wait to tell all her friends about Hammer and the delightful free t-shirt she received just by telling her friends about Hammer. You see the pattern here? Less than a week later another friend ordered products from Hammer using Sally’s discount code and Sally also ordered.
Giving SWAG to loyal customers is nothing new. Giving UNSUSPECTING SWAG delights customers and makes it seem like you’re doing them a favor. They in turn want to help you out by being even more zealous about your brand. This is a surefire way of turning customers into evangelists.
SWAG Silver and Gold
So why shower your most loyal with free stuff? I mean, after all, they love you already. Shouldn’t you save the good stuff for acquiring customers? Right? WRONG! While the research isn’t exactly clear, it is exhaustive on the costs associated with acquiring new customers vs. retaining old ones.
But sifting through various studies show that cost estimates for acquiring new customers range from 3 to 30 times those costs for keeping loyal customers.
It’s a safe bet that if you’re in the business of staying in business you should make like the Girl Scout motto song and “Make new friends, but keep the old. One is silver and the other is gold.”
And one of the easiest, least expensive ways to do this is to shore up your relationship with long-standing and loyal customers by offering them exclusive and special promotional products. Whether it’s a Price Buster Cap or a Cotton T-Shirt, the SWAG you send to them should be unique and memorable and unsolicited. That means the SWAG itself should be worth bonding with. Confused? Let’s look at e-mail marketing powerhouse MailChimp.
Giving the Gift of SWAG
By all accounts MailChimp is an American success story. You can read all about how MailChimp Founder Ben Chestnut turned a small e-mail company into a quirky start-up turned corporation, but what we’re going to focus on is the weird knit monkey hats.
The hats, according to the Wired article, were created after a MailChimp staffer had a visiting relative from Asia show him a hat he bought from a street vendor. MailChimp branded it with their famous “Freddie,” the MailChimp mascot, the little monkey you see emblazoned on all their e-mails.
More important than how they’re made—though that’s pretty important too–is who they give them to–their loyal customers. They gave out about 500 in the first run and MailChimp Marketing Director Mark DiCristina told Wired, “People loved them, so we ordered more.”
MailChimp gives uniquely designed, and crafted SWAG to customers, like specially made t-shirts, beer coozies, plush toys, wrestling championship belts, coloring books, propaganda posters, monkey-themed knit caps for cats, and more.
MailChimp clearly takes promotional product giveaways to a new level. The Wired writer alluded to founder Chestnut’s industrial design background as a reason they have so many product designs for their SWAG. But I like to think there focus on specially-designed promotional products for their customers has more to do with DiCristina’s observations that:
We think of them as gifts. There’s no way to directly measure the impact of giving away shirts and hats, and that’s OK with us. Thinking about them as gifts changes our perspective, too. If we considered them primarily marketing expenses, we’d want to figure out how to minimize cost and maximize the brand effect—essentially, we’d be thinking about ourselves. As gifts, we think first about the recipients and about how they’ll feel when they receive the gifts. So we go over the top to make people feel special.
The next time you’re pondering the cost of buying promotional items for your current customers remember DiCristian’s words. Think of them as gifts, not liabilities. You’re gifting to people who ensure you’re in the business of staying in business. Isn’t a $15 Hoodie worth that?