Certainty Vs. Uncertainty: How Does It Impact Marketing Promotions?

Certainty vs. Uncertainty: How Does it Impact Marketing Promotions?

Companies like AT&T, McDonalds, Subway, T-Mobile, and many others spend millions of dollars every year in an effort to increase consumer interest in their products by using free giveaway promotions and other similar marketing programs. Companies use a wide and varied spectrum of promotional programs as this quote states, "Marketers continue to struggle to design effective and profitable promotional campaigns. Common forms of promotion include coupons, seasonal price, discounts, sweepstakes, contests, free samples, trial packages, loyalty reward programs, and free gifts" (Laran and Tsiros, 2013). Companies may give the free gift with the purchase or after the purchase, or offer an array of possible gifts that the customer may receive. Laran and Tsiros in their article, An Investigation of the Effectiveness of Uncertainty in Marketing Involving Free Gifts, explain that the largest industry to adopt promotional giveaways are cosmetic companies, however the results have been mixed. "Some companies have more than 50% of their sales tied to free gifts (e.g. Este Lauder), others (e.g. Chanel) do not offer any. While giveaways may be very successful for one company, another company perhaps based on their culture and customer demographic may not find them at all necessary or useful. However, ultimately these decisions for companies appear to be linked to customer emotion, type of purchase, and the company bottom line. My primary goal is to compare the effects of certainty and uncertainty on customer buying and its impact on the success of this marketing strategy. My focus in will be on two questions: Do giveaways increase consumer interesting and the chances of a product purchase and how do certainty and uncertainty about these items impact customer interest and marketing success; in other words are consumers more likely to participate in a promotional campaign if they know what the free items will be and is there a significant difference in the amount customer participation and number of purchases, based on their certainty or uncertainty about free gifts.

Whether or not companies use promotional giveaway marketing strategies or not, it does appear that consumer certainty and uncertainty play a significant role. Marketing Strategist Stan Phelps in his book, What's Your Purple Goldfish?, uses the acronym G.L.U.E. or Giving Little Unexpected Extras. In the book Phelps recounts stories of companies going the extra mile for by giving free items and amenities when customers make a purchase. Interestingly, many freebees are not advertised before hand, but rather are thrown in after the deal is made "...to sweeten the customer experience after the deal" (Rice, 2013). Laran and Tsiros in their research have found that the customer's buying experiences have less to do with the giveaway and more to do with