Yours Free: 4 Steps to Selecting a Winning Premium


By Robert W. Bly



            If you’ve been in direct marketing for more than a few weeks, you know that offering a premium can significantly increase response rates.

            Well, in my opinion, the four most important factors to consider when choosing a premium are: value, novelty, relevance, and desirability.

            1. Perceived value. A good premium either (a) has a high perceived value or (b) has a value that the reader cannot determine.

            The worst premium is an item that the prospect sees as having a low value.

            Example: a well-known financial newsletter publisher did a series of blanket renewals with each offering a different premium for early renewal.

            One of the best-performing premiums was a video of the editor giving financial advice. The promotion positioned it as a free financial consultation with the editor in the privacy of your own home.

            One of the worst-performing premiums was a pack of playing cards with the editor’s picture on each card.

            Why didn’t playing cards work well as a premium?

            One reason is low perceived value.

            You can buy a deck of playing cards in any drug store or stationery store for a dollar or so.

            Therefore, the perceived value of the playing card deck premium was about a dollar.

            The video, by comparison, has a much higher perceived value: videos can sell for anywhere from $19 to $79 or even higher.

            And since the editor was a highly paid investment advisor, positioning the video as a free one-hour “consultation” with him boosted the perceived value even higher.

            Readers knew such a consultation would cost several thousand dollars, if the editor would even agree to it.

            2. Novelty. As a rule of thumb, unique premiums generally – but not always – pull better than “me-too” or commodity premiums.

            Newsletter and magazine publishers know that an exclusive special report, written by the editor on a topic of interest, is an effective premium because it is a unique item: the reader can’t get it anywhere else.

            On the other hand, offering best-selling books as subscription premiums has generally not worked well, because the item is so readily available: if the premium is a best-seller, there is an excellent chance the reader already has it – and if not, he can just pop into a bookstore and pick one up, without subscribing to your publication.

            One subscription premium that did extremely well was a coffee mug for Advertising Age. Of course, coffee mugs are about as ordinary an item as you can get.

            But here was the gimmick: the artwork on the mug looked like a faux front page of Advertising Age. Each mug was laser-imprinted with the subscriber’s name incorporated into a headline, e.g., “Jane Smith wins Advertising Age’s ‘Advertising Genius’ award.”

            3. Relevance. Many consumer marketers have found that premiums having little or no relationship to the product have worked extremely well. Examples include free telephones, tote bags, and solar calculators.

            On the other hand, many other consumer marketers, and a large number of business-to-business marketers, have found that they get a better lead or customer when they offer a premium that’s relevant to the product.

            Years ago, Weka Publishing mailed a package offering a loose-leaf service on managing Novell networks. When they tested the control against a version offering a disk with 5 free utility and shareware programs for Novell, orders doubled.

            4. Desirability. The more desirable the free gift, the greater the number of prospects who will respond to your promotion to get it.

            One of the best premiums I’ve ever seen was for the Sovereign Society, a financial newsletter focusing on offshore asset protection.

            The premium? If you subscribed to the newsletter, the publisher would open a Swiss bank account for you!

            Offering the Swiss bank account as a premium meets all four criteria with flying colors:

            * Perceived value. How much should it cost to open a Swiss bank account? I have no idea, and probably, neither did the subscriber. But prospects knew that Swiss bank accounts were something rich people generally had – “NOT just for millionaires anymore” the headline exclaimed – and so the perceived value by logical extension was probably high.

            * Novelty. Most financial newsletters offer special reports as premiums. The idea of offering a free Swiss bank account was clever and unique.

            * Relevant. Offering a free Swiss bank account as the premium is directly relevant to the newsletter’s core proposition of helping readers protect their assets offshore.

            * Desirability. High. Even if you don’t have a lot of assets you need to hide offshore, it’s a status thing: casually mentioning your “Swiss bank account” to neighbors impresses the heck out of them – giving the customer immense pleasure and satisfying the need for exclusivity.


About the author:

            Robert W. Bly is a freelance copywriter and the author of more than 60 books including The Copywriter’s Handbook (Henry Holt & Co.). His e-mail address is and his Web site address is