Why Special Marketing Deals for New Customers Are Dishonest

Special marketing deals for new customers is dishonest. Period.

I think one of the travesties of today’s marketing is the special promotion designed to bait or attract new customers. I believe it’s a dishonest marketing tactic which works against customer loyalty.

Most companies use special offers or promotions to bait or attract new customers with the belief they will kick sales up a notch and increase revenue.

For the most part, special deals use price as the hook and are time based to encourage people to make a fast purchase decision.

“For the next three months subscribe to our wireless service and get a free LED TV” is a common promotion offered by many as a way to acquire new wireless customers.

These offers are dangled in the face of a potential NEW customer; THEY receive the free TV.

On the other hand, someone who has been a loyal wireless customer for 10 years gets NADA even though they have supported the company to the tune of thousands of dollars.

This is crazy.

There are two main issues I have with this bait marketing approach.

Lazy marketing

First, it’s lazy marketing. The easiest thing to do is to give stuff away with the mistaken belief that if you do, the recipient of the gift will somehow feel obligated to enter your loyalty tent and remain dutiful henceforth.

What a joke.

Despite the studies marketers trot out, people value what they pay for, and if they pay nothing to move from another supplier to you they laugh under their breath and wait for the next juvenile marketer who comes along and makes you a better offer. And when they find one, bye-bye.

Intellectual dishonesty

Second, bait marketing is not only an insult to the loyal customers who have given themselves to your organization for years, it’s also intellectually dishonest.

Existing customers rarely qualify for the bait deal. The free TV is NEVER offered to the customer who has been loyal for 5 or 10 years!

They have steadfastly paid their bill on time every month. They have put up with the odd price increase and policy change but their loyalty has been resolute.

And they have rarely been offered a deal on anything. They may have been thanked for their loyalty with words or an annual free calendar, but certainly nothing as substantial as the person being baited.

And when they discover that a special promotion is being offered to new customers and ask for the same deal they are told “I’m sorry you don’t qualify for this promotion”.

How do they feel? Second rate? Third rate? Don’t rate?

Special offers should be placed at the feet of your loyal customers fIrst. Reward or retention marketing may not be as sexy as its bait cousin, but special deals should be extended to existing customers FIRST!

It’s an awesome way to thank people for their ongoing support and return the favour with a token of your appreciation. Think about it as re-investing (in them) some of the revenue they have generously given you over the years.

But companies rarely use promotions this way.

They’re afraid of losing money

They actually believe that if they offer the new customer deal to an existing loyal customer they will lose money; they don’t want to take the revenue hit from current customers taking advantage of the savings.
They don’t feel it is necessary to offer the promotion it to loyal customers to encourage them to stay. And if an exiting customer takes the deal they don’t believe it stimulates new sales.

These are bogus arguments for a number of reasons:

Offering something special to your loyal fans will surprise and delight them.

They will stay loyal to you as long as you serve them well. And they will act as your best advertisers by telling the story to others about how great you are. Revenue will grow as a result.
Ever done a Net Present Value calculation on a customer who has been with you for 10 years? Is it a big number or small number. Right!

If you don’t include them they will find out.

They will know that they are not included in the deal and they will be angry and feel neglected. They might leave you, but for sure they will talk you up to their friends and family as a selfish organization that does not care about their loyal customers. They will slander your brand; shouting out your lack of integrity and honesty.

If your special deal attracts someone because of their thirst for your low price, what makes you think they won’t leave you for a better offer? A special targeted at ‘switchers’ is also fuel for more switching. Then you have

realized zero return on your promotion investment and you have given your current customers reason to leave.

Investing in your loyal customer base always makes sense.

You’re not reducing your margins by offering them the special deal, you’re reinvesting some of your margins in them to maintain their loyalty. Why do companies buy back their own shares?

Read the fine print. This offer is for ‘new subscribers only’. As a customer for many years, this reduces their brand value in my eyes…

It’s time organizations re-think the strategy behind ‘the special deal’ which is unethical and dishonest.

Any way you cut it, the deal strategy for new customer acquisition is risky.


Smart marketers go for the sure thing in the long run.

Show customers why they should stay with you.

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