You could increase your overall direct mail or email promotion response rate by 15% or more when you incorporate premium giveaways and incentives into your promotions. Consider these factors before you include incentives in your next promotion or campaign.


  • Free or Earned Incentives: Both work. The difference is that an absolutely free incentive usually is a lower cost item. It doesn't require the member to close the loan to receive it, only apply. An earned incentive is a reward for funded loan or for a product/service bundle.


  • Popular Incentives: Use premium/freemium incentives that research shows are popular, such as cash, a gift card or a electronic item (DVD player, TV, digital camera, iPod, etc). For larger ticket items, entry into a sweepstakes is another option.


  • Unique Incentives: Unusual premium/freemium incentives can help generate member interest . For example, credit union unions have offered an iPad mini as a earned reward.


  • Generate Excitement: A sweepstakes incentive can add excitement to your promotion, especially when there is a significant grand prize, such as a car, vacation, iPad, or big screen TV. One credit union offered a full-sized jukebox and another a snowblower.


  • Illustration Sells: Use a photo or appropriate art with a brief description of the actual premium in your direct mail, newspaper ads, posters, and broadcast media. Expand the description in your newsletter and on your website. A higher value premiums should be prominently featured in all promotional materials. The higher the value, the more prominent the incentive should be.


  • Integrated Marketing Channels: Promote your free or earned premium offer in all of the media and merchandising included in the campaign or promotion.


  • Cost Versus Response: The lowest possible premium cost is always a consideration, but the cost should not be the primary selection criteria. A premium with high perceived value will deliver a better response and therefore will be more cost-effective. Base the premium cost on the value of the loan or service you are promoting. For example, a mortgage or home equity loan premium should have a higher value than a service premium. Consider that your premium cost is only higher if your promotion or campaign is successful.


Equally important, make it as easy as possible for the member to redeem the free premium or earned incentive. When you include significant requirements your response rate will be lower.