Digital Marketing: Six specific examples of incentives that worked

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Let’s face it. It’s not just in marketing. Our society abuses incentives in general.

I used to get my children to eat vegetables by promising them junk food. And marketers will throw all sorts of incentives at customers to get them to act and buy.

As any child psychologist will tell you, my technique to try to get my children to eat healthy is not ideal.

And it’s not any better when marketers are overly focused on incentives either. Which is why we consider incentive-based marketing to be the lowest of the five levels of marketing.

That said, while incentives shouldn’t be the main reason you get a customer to act, the right incentives used in the right way do have their place — as that little extra bit of value that tips a customer into action. It’s that extra something that reduces cost or increases value to the point at which the customer decides to subscribe to an email list or make a purchase.

To spark your own effective use of incentives, here are six examples from a wide range of companies used in a diverse array of tactics.

Example #1: 31% higher conversion rate for B2B firm by finding the right gift card value/volume balance in a sweepstakes

When your incentive is sweepstakes related, you must find the optimal value/volume balance.

For example, you could have your prize be one Tesla Model S Long Range Performance Model with Ludicrous Mode.

Or, you could give away one hundred Aventon Pace ebikes to one hundred different people.

The cost would be the same for your brand. But the question is, which would be more appealing to your ideal customer?

Troy O’Bryan, a student of the MECLABS Institute on-demand Landing Page Optimization course, faced this challenge with one of his clients (MECLABS is the parent organization of MarketingSherpa).

He was working on a white paper download landing page. The first page had a form that simply asked for an email address. But to encourage more completions of step two of the form, which asked for information like phone number and purchase timeframe, the company included language about an incentive — On the next page, you’ll also have a chance to enter to win one of [VOLUME] $[VALUE] Amazon gift cards.

How many should the company give away? And at what cost? Troy tested two treatments:

• Incentive #1: Twenty $25 gift cards
• Incentive #2: Ten $50 gift cards

Incentive #1 had a 43% conversion rate, and Incentive #2 had a 56.5% conversion rate.

So for the exact same $500 investment (either 20 x $25 or 10 x $50), Troy was able to generate a 31.4% increase in conversion rate just by finding the optimal way to present the incentive to the customer.

Flint McGlaughlin, CEO and Managing Director, MECLABS Institute, explains more about this test in the MarketingExperiments video Unlocking the Power of Incentive: Three keys to mastering perceived value differential, which we have also embedded below (MarketingExperiments is a sister publication to MarketingSherpa).

 

 

Example #2:  Incentive-based referral program generates 17% more bookings for roofing companies

When I first moved to Jacksonville many years ago, I was looking for a mechanic. In my search for this service-based business, there was not one single advertisement or piece of marketing that was as persuasive as Brian.

Brian was my co-worker, and all he had to say was, “Oh sure, I know a guy …” Two guys in a garage with no official advertising or marketing served my family well for two decades.

And the same is true for many B2B and B2C brands. Even the most high-production Super Bowl ad is not as compelling as your friend, work colleague or family member. In fact, word-of-mouth from friends, family and colleagues is the second most common way customers discover new products.

How do you get that word-of-mouth? Put the customer first in all your company does. We discovered that satisfied customers are more likely to recommend a company than unsatisfied customers. Not surprising, I know. But here’s what we did. We benchmarked just how big the difference is — satisfied customers are 771% more likely to recommend a company than unsatisfied customers. Use that data point in the next boardroom battle where you have to advocate for the fact that truly serving the customer is a critical part of marketing.

But let’s say you’re doing all that right, what else can you do? Offer an incentive to encourage customers to recommend your company.

MyRoofingPal, an internet marketplace that connects homeowners and businesses with roofers, has an incentive-based referral program where users can earn money from contractors if they recruit more people who utilize the services of that same contractor.

Customers who make a referral get a 10% discount off the overall cost of their project if the person they refer books a project with the roofer. Users are told which contractors are participating in this offer by MyRoofingPal, and they're given a referral code to hand out to other home and business owners.

“Each code is specifically generated for that contractor or company, so it won't work if the new user doesn't book services with the participating roofer. Once they do, the original client receives the discount from their total bill, and the new client has the chance to offer a referral in the future, as well,” said Courtney Keene, Director of Operations, MyRoofingPal.

Contractors that participate in this referral program currently receive 17% more bookings on the site than those who do not. “With the average cost of a simple repair being around $600, that $60 the company is knocking off the bill is nothing compared to the value of a new lead that could secure them an additional $300-$1,000 on average,” Keene said.

If the referral happens after the customer already paid for their roofing project, they get the 10% discount as a refund. “In general, contractors are using checks to issue these refunds, though we're trying to get them to use a more secure method. eChecks and even Visa prepaid cards would be preferred,” she said.

Example #3: Free shipping incentive nearly triples large orders for custom art company

Customers love themselves some free shipping. There might not be much that baby boomers and millennials can agree on, but according to our data, providing free shipping was the top way that retailers could improve the shopping experience for females 65+, males 65+, females 18-34 and males 18-34.

What might a free shipping incentive look like for your company? To spark your thinking, here’s how a custom illustrated pet portrait ecommerce website used free shipping.

West & Willow offers a free shipping incentive for orders over $100. They don’t mention the incentive early in the funnel — their PPC ads focus on the value of the product. But once customers get to the site and are farther along the buying journey, there is a banner at the top of every page reminding the user of the free shipping incentive.

Creative Sample #1: Free shipping incentive banner on website

In the checkout flow, there are also upsells for add-ons like a digital copy of their portrait and getting their portrait done sooner. “They're incentivized to choose an add-on because, in many cases, it puts their order total over $100, which gets them free shipping,” said R.J. Michaelson, Director of Marketing, West & Willow.

Creative Sample #2: Upsells in checkout flow

After offering free shipping for larger orders, the number of orders that were over $100 nearly tripled. “I can say that the increase in revenue from offering the free shipping incentive more than made up for the cost of providing free shipping,” Michaelson said.

“No consumer likes to see their order summary bill rise with shipping costs, and will even pay for more of your product to get a better deal on shipping,” he said.

Example #4: Change in discount generates 400% ROAS for Wordpress Theme creator

In the first example, we discussed testing different presentations of sweepstakes giveaways. And the same holds true for another popular incentive — discounts.

After testing multiple timings and offers for a WordPress Theme creator that had a freemium sales model, Paul Bonea’s team discovered that showing a pop-up banner in the WordPress dashboard with a 20% discount three days after installation provided about a 10% lift in revenue, mainly from users who wouldn't have bought otherwise.

“Interestingly, this offer didn't work at all if we used a one-day or two-day timing. Our guess was that the move seemed way too desperate and turned off potential customers,” said Bonea, the founder of Perfect Data agency.

The company increased its discount based on behavior. Customers who had visited the premium landing page three times without buying would enter a remarketing campaign. The remarketing campaign would bring them to the same landing page, however, they would see a different incentive:  a time-limited (one hour) 40% discount.

“The conditions were pretty restrictive, so it didn't bring in a lot of money,” Bonea said, “but it did have a [approximately] 400% return on ad spend (ROAS), which was satisfying to see.”

Example #5: 100%+ increase in email signups for virtual event company from lead magnet that better taps into visitor motivation

A lead magnet, as the popular industry term suggests, pulls leads into your funnel because it’s so, well, magnetic. That is to say, it has a value that attracts potential customers to your brand — often enough value that it entices prospects to fill out a form with information and become a lead, or at least an email subscriber.

While we at MarketingSherpa don’t use the term “lead magnet,” we do have a whole host of free resources with their own landing pages that many in the industry would consider a lead magnet. You can see how we execute these for yourself in the free reports, how-to guides and marketing resources section of this website.

Virtual event company WebBabyShower.com seeks to get leads from its informational blog content. People get to this blog because they’ve searched for general information about baby showers. For example, etiquette and social guidelines for these events. “They might not even know about our online baby shower service offering,” said Kurt Perschke, owner, WebBabyShower.com. So his team’s challenge was not to get them to buy right away, but rather just to move them to the next step of the funnel and begin a relationship with WebBabyShower.

The team created a series of customized lead magnets for the most trafficked blog pages that better tapped into visitor motivation than just generic lead magnets. These included creating colorful games, graphics, ready-to-print cards and planners that would all provide immediate value to visitors. These were low cost to create and were used as evergreen perks and content upgrades that didn't need timely updates.

Let’s walk through a specific example. The blog post “17 Baby Shower Thank You Card Wording Examples for Every Situation” was one of the top trafficked content pages on WebBabyShower.com. This page is specifically focused on wording ideas for thank you cards in different situations. “It’s kind of like a ‘swipe file,’” Perschke said. “The page gets solid traffic but isn’t ideal for sales conversions because, well, these people already had their party, and at WebBabyShower, we are providing online baby showers. So our goal for this post is email capture and social shares.”

Creative Sample #3: Informational blog post from virtual event company

At the end of the blog post’s intro, just as readers are getting into the meat of the post, there is a lead magnet opt-in.

The lead magnet is a PDF download of the ‘swipe file’ plus some extras. “Women want to print it out and have it where they are writing cards, not have a laptop open constantly,“ Perschke said.

That is not a throwaway quote from Perschke. That is a brilliant insight, so I want to make sure we don’t overlook it. By better understanding customer behavior, you can better serve customers and increase results.

However, you are not your customer. So you must bridge the gap between you and them.

Often you hear marketers or business leaders review an ad or discuss a marketing campaign and say, “Well, I would never read that entire ad” or “I would not be interested in that promotion.” To which I say … who cares? Who cares what you would do. If you are not in the ideal customer set, sorry to dent your ego, but you really don’t matter. Only the customer does.

Perschke is one step ahead of many marketers and business leaders because he readily understands this. “Owning a business whose customers are 95% women has been a great education for me,” he said.

So I had to ask him, how did he get this insight into his customers’ behavior? Frankly, it didn’t take complex market research. He was just aware of this disconnect he had with the customer, and he was alert for ways to bridge the gap. “To be honest, I first saw that with my wife. Then we asked a few customers, and they confirmed it’s what they did also. Writing notes by hand is viewed as a ‘non-digital’ activity and reading from a laptop kinda spoils the mood apparently,” he said.

Creative Sample #4: Relevant lead magnet opt-in on blog post page

While I’ve emphasized Perschke’s efforts to better understand his customer, by no means do I want you to think this tactic will only work for women considering a baby shower. Offering the same or similar content (Perschke’s download includes the content on the page, but also has additional content) in a different format behind an information gate can be a very effective tactic.

For example, MECLABS Research-based Lead Gen Swipe File includes before, after and results for all 22 valid experiments right there on the page, no form fill required. However, we also offer a form to download the exact same information. That form has a 22% conversion rate. Remember, all of the visitors to this page can freely see the information already without providing any of their information, and yet almost a quarter of visitors have chosen to fill out the form to get a PDF with the same information.

Back to WebBabyShower. “We've seen a [more than] 100% increase in email signups using this method, which was both inexpensive and evergreen,” Perschke said.

Lead capture has gone up 113%. Since launching the new initiatives, the site has garnered an 8.5% conversion rate for blog content traffic to an email lead. As a comparison, generic site-wide lead magnets on these same pages converted traffic at 4%.

After visitors fill out the form to get the incentive, WebBabyShower has a second step where visitors can choose to share the post on Facebook. At this point, thy get an additional incentive — a set of free printable thank you cards. Since they were designed by the WebBabyShower team, “you can’t get them anywhere else,” he said. Prospects can also opt out and just get the original download.

“To create that viral page, I should give a hat tip to a free tool Bryan Harris offers. That’s what we are using, and that viral page is on our domain, not a third-party site,” Perschke said.

Creative Sample #5: Viral page with extra incentives for social shares

“The extra work of matching search intent on the page and creating a lead magnet that speaks to that specific need has been well worth it. However, pick your high-traffic pages first so you can test ideas where the reward will be the biggest. Don't roll out everything at once, take it page by page so you can improve as you go,” Perschke advised.

Example #6: Relevant hard goods incentive increases revenue 181% for health, wellness and fitness company

 The incentives we’ve discussed in this article so far have either been monetary or virtual. But hard goods can be profitable incentives as well. The challenge with hard goods is, due to the usually increased cost of the incentive, making sure the cost of the incentives doesn’t ding your margins to such an extent that it actually causes you to lose money (as compared to the product sale without incentives).

“Including free high-margin items with orders is one of the best incentives you can give,” said James Parsons, CEO, Content Powered.

For example, one of Parsons’ clients sells expensive supplements and meal replacement shakes. With every order of $100 or more, the client will ship a free blender, which they purchase very inexpensively from a manufacturer in China. Their products are already high margin, so they are making plenty of profit. “And customers love free things, especially something more substantial like a blender,” Parsons said.

“They bought the blenders in bulk, around 1,000 at a time, so they are getting the absolute lowest price for them. They've already received some great feedback from their customers through their website and on social media,” he said.

To communicate the offer to customers, the client’s product image shows a blender with the words "FREE" under it, and the item description lets customers know it includes a free blender.

“They use the ‘Bold Upsell’ Shopify plugin to also upsell anybody who adds the smaller quantity to their shopping cart, to let them know they can get a free blender if they get a two-pack,” he said.

Over the past year, a smaller quantity of the item sold roughly 1,400 units, and it did not come with a free blender.

After adding a new two-pack product and including a free blender, roughly 4,000 units were sold. Adding this new two-pack pricing tier and including that free blender worked out to a 181% increase in revenue.

“This is a significant increase, with very little extra cost to the business. It's also an easy upsell opportunity for anybody who adds a single item to their shopping [cart],” Parsons said.

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Related Resources

Social Media Marketing: 7 steps for using contests and sweepstakes to promote your brand

Incentive: The bacon of marketing tactics

Digital Marketing: 3 test ideas to optimize your incentive offers