Category Archives: Commentary

Now that's an offer!

gas-pump-closeup-comp.jpgChrysler’s guaranteeing gas for your new vehicle will stay under $2.99/gallon for the next three years.

Talk about a great offer that addresses a couple of problems:

  1. Chrysler has too many large vehicles to sell, with lousy gas mileage.
  2. Gas at $3.00+/gallon is putting a crimp in the budgets of potential buyers, slowing down overall sales.

Rather than go the traditional route of putting cash on the hood of the trucks, in the form of rebates and/or lower interest rates, Chrysler whipped out the calculator. It doesn’t really matter where the “offer cost” goes from a P&L perspective (neglecting any GAAP requirements for the moment), but it does matter from the consumer’s psyche.

The glow of a low price on a 12 mpg truck fades pretty quickly when faced with $3 or $5 gas. Now the customer can at least put a cap on how much they’ll spend for gas over the next few years and take that worry out of the purchase equation.

Summary and takeaways

  1. Think creatively when developing incentives. Don’t restrict yourself to the traditional BOGO, “X% off”, “FREE X with purchase” offers. The more complex the purchase equation, such as a motor vehicle purchase, the more opportunities you have to create interesting offers.
  2. Use your calculator. Once you’ve got that great idea, make sure you do the math carefully. In the case of Chrysler’s offer, it could get expensive if gas rockets to $8/gallon. On the other hand, if it drops to $2, this could be one of the best offers of all time. (Assuming it helps sales.)

Posts and comments from around the web

istock_000005779413medium-comp.jpgI was doing some SEO work this morning (and SEO will be the subject of a longer article in the near future) and happened to find a few articles where I was interviewed on topics ranging from membership to deploying analytic platforms using SAS software to education and internships.

Here’s a quick look at a few articles that might be of interest.

How important is membership to a non-profit organization? The Chronicle of Philanthropy did an article in 2005 about non-profit membership numbers and how the organizations count their supporters. It’s an interesting look on the philosophies that non-profits use. My takeaway and experience is that you should ask questions about an organizations membership and support numbers, especially if those are important to you.

I was really proud of the work I did with our CIO at WWF to upgrade our analytics capabilities using SAS. This article from the SAS user magazine has a few terrific examples of what Greg Smith and I were able to accomplish by moving aggressively to upgrade the organization’s analytic capabilities and improving our access to marketing data.

While I approach marketing from an analytic, direct response point of view, I also track brand marketing efforts to see if the principles of DR can be applied. KFC ran a promotion in late 2007 to encourage lunchtime visits to their stores by office workers. I gave it high marks for creativity, but was worried about the execution.

Finally, with college graduation approaching, I found this article at Utica College’s website where I was interviewed and offered thoughts on the importance of internships for college students.