The Tax-Free Sale

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States have Back to School sales on certain items – these tax-free sales are very popular as people. Families put together lists of items they need and wait for the day; they visit the store during the sale and all are happy – the customer and the retailers. Retailers are happy because in addition to the merchandise on sale, they are also able to move full price items, plus even some taxable items. Because of the amount of ‘money’ they have saved in taxes – the buyers are happy to purchase the additional items.

Unfortunately, this tax-free sale concept has been totally abused, and is being used as an ultimate weapon to close new deals. I have been offered tax-free incentives to purchase furniture, a car, a vacation and even clothing. The retailer is simply paying for the taxes themselves diluting the true magic these words originally had.

My daughter, who is 11, kept rolling her eyes every time a salesperson told us about their Tax-Free offer. She got me thinking about this and was the motivation for this post (Thanks Shivani!)

Many times as marketers we try to reuse something that works well, running the risk of trivializing the offer. Anticipation or creating a genuine sense of expectation is much more effective in helping create superb offers. Get your openers, clickers and buyers to yearn for that special offer is a great way to personalize and create that special sale. Here are three examples that stand out in the year ahead:

First Look: 70–90% OFF
A major retailer segmented its list into buyers and non-buyers. Non-buyers were further segmented into clickers, openers and non-openers. These people were targeted with the email being trickled over a few hours – buyers got it first, non-openers last. Each group was asked to update their preferences; all responders were told to look for the next season clearance event and learned that the more attention they paid to the emails the earlier their notifications.

The Employee Discount
An apparel retailer offered employee discounts to some of their best customers as a thank you for their purchases over the year (2006.) Additionally each CSR was given ONE coupon to share with ONE customer. Come 2007, these buyers were aware of this closed door special sale and looked forward to this event. In 2007, each buyer was also given ONE coupon to share with their friends/ family. It was very effective, for not only did it create revenue but it created a special bond with the receivers of the offer over the entire year. This segment of customers had a much higher attention rate.

The 10% CD!
When interest rates were less than 5%, a financial institution offered a 10% CD – only 500 were available. It was a phenomenal event, more than a quarter of their list inquired about the CD, filled out preferences and more than 500 CDs were given away in less than 45 minutes! Oh, and talk about paying attention – the email-only offer was launched at 8.00 am EST.

The lesson from today’s post is that we shouldn’t ride the Tax-Free sale offer or the same offer to extinction. Another key learning is that the best thing to do is to remind people about an event and start a build-up leading up to the special event.

Hope your 2007 was great, best wishes for 2008.