For the next couple of weeks, McDonald’s locations in Canada will be giving away free small coffees to anyone who asks for them. The promotion is only during breakfast hours, but it comes with zero strings attached. While they would certainly appreciate if you bought something, this is not a requirement for getting your free small coffee.
To some people, this may sound like a wildly absurd promotion, because it does not generate any revenue directly for McDonald’s. However, the small loss incurred from giving away the small coffees may be easily covered through the possible increase in breakfast meal sales. The customer that may have otherwise gone to Tim Hortons for breakfast would now buy their morning muffin from the golden arches.
But the real scope of this promotion extends far beyond the two weeks of free coffee. Many people may prefer to get their morning coffee from Starbucks or Tim Hortons, so they have no incentive to change up that morning routine. In this way, they may have never given McDonald’s a fair shot at being their preferred breakfast coffee location.
The price of zero dollars and zero cents is a huge incentive. This will get people through the door and, presumably, filled up with two weeks of free coffee. By the time the promotion ends, McDonald’s may have gained many customers that it may not have otherwise been able to reach. The short term loss can generate a long term gain.
In looking to your own business, are you providing enough of an incentive for potential customers to give you a try? Are you motivating people to switch from a competitor?
Conveyancing
April 21, 2009 8:34 pm
Wow good idea for your product promotion but for all of that effective management is required otherwise it might be risky .
Renee
April 22, 2009 5:52 am
What McDonald’s is doing is a typical gimmick to get people into their restaurant. The idea of buying a ‘good cup of coffee’ from a location that is known for its greasy burgers will probably not appeal to the typical Starbucks goers. Tim Horton’s, on the other hand, specializes in breakfast foods and an affordable cup of coffee, may be a more relevant comparison.
In relation to small business, I think that your incentive or free offer must be relevant to your business and highlight your good qualities, not necessarily something that is the most affordable catalyst to get people in. If your business is a service based business, offer a free 30 hour session of your BEST quality service. Dont always entice your prospects by taking the cheapest route. If you are a product based business, give away a sample of your BEST product. But remember, if you are handing out your best assets, take the time to highlight their quality and competitive advantage.