Read the flyer first
A little story.
I recently ordered a book from Amazon. Actually, it wasn’t recently, it was before Christmas but due to popular demand it sold out and I had to wait till late February. No problem. The book came, and with it a voucher for £40 off Virgin Wines online. I’m sure many other people have received this flyer as well. At first, it sounds nothing out of the ordinary.
Instead of simply throwing it in the bin I decided to visit the website.
Step 1 – I’ve visited the website. Fair enough. That doesn’t have to mean anything.
I decided to go through the instructions on the voucher, register, enter the code and voila! My account has been credited with £40.
Step 2 – I’ve signed up, I’m establishing a level of trust and beginning to lower my guard. I’ve been rewarded for this.
I don’t know the first thing about wine. I enjoy it but wouldn’t know a Shiraz from a Chardonnay. So after a swift perusal of the site, I leave and forget about it.
About a week later I received a polite email from ‘Jay’ at Virgin Wines’. It wasn’t pesonal, although it tried to be, but I didn’t mind, there was still some thought there. Jay kindly explained that because I hadn’t yet bought anything, they weren’t doing a good enough job. So he offered me a deal I couldn’t refuse. Plenty of wine, free glases and a fancy bottle opener for only £48. Considering I already have £40 credit to play with – that would mean spending £8 for a lot of wine. Bargain.
Step 3 – Sweetening the deal, offering me more for little in return. I decide this is something worth telling people.
I’ve yet to buy any wine, I may wait till someone’s birthday crops up. But at work today I told 7 people about this episode, and tonight, at the pub, I may decide to tell my mates.
The moral of the story:
The £40 credit is not £40 to Virgin, it’s perhaps £5-£10 at most, before their markup. That may seem like an awful amount of money to waste on one person. But if the people I told at work, and the people I’ve yet to tell, and you reading now decide to investigate a bit and end up buying some wine for yourselves or continue to tell other people… well – that £5 Virgin spent on me may become £50, £100 + profit through other people buying wine through their site thanks to the power of word of mouth marketing.
Now would that money have been better spent on a few clicks of a tacky banner ad, or a stack of throwaway flyers that will be read by practically no-one?
Through the flyer I recieved, Virgin can monitor (to some extent) the impact by how many people have registered on the site and entered the offer code, and how many people have spent that free credit. What about the option to recommend the offer to others? Or for every bottle of wine you buy you receive a free £5 off voucher to send to a friend of choice?
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Sanghmitra said:
Thats interesting ans so true.. word of mouth is an area where not too many companies focus these days.. just think of how much they could save if they did..