Napoleon Bonaparte has carved his name in the history books. 
Some say he was a masterful soldier. Some say he was a very
charismatic statesman. Others say he was the best strategist who
ever lived. Yes, he was all of that. But he dominated the world
only because of one of his tactics. He created and ruled an
empire only because of one secret.

He gave away baubles. 

What are baubles you ask?

Baubles are small ornaments that have little monetary value. But
they do have great emotional value attached to them. Napoleon
gave Baubles to his soldiers when they achieved a notable feat.

Giving baubles as rewards was the single most important tactic
that helped Napoleon establish a humongous empire. This tactic
achieved 2 things:

1. Made his soldiers fight harder to earn more baubles.
2. Made his soldiers loyal to him.

Give bonuses and rewards to consumers and you’ll soon build a
business empire too. The consumers will buy your products for the
bonuses. And they will stay loyal to you if you provide bonus
goodies every so often.

Now that you know that baubles = bonuses and rewards, let us now
see what kind of baubles should we give away and how to give them
away for the best results.


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E. Joseph Cossman reveals the type of 
baubles you should give away

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E Joseph Cossman is a marketing legend. Wall street journal calls
him: The Messiah of the free enterprise system. He made more
than 1 million dollars through mail order. What’s more, he wrote
a book about it (How I made $1,000,000 in mail order – And you
can too!), which became a classic. Yet even he sometimes had
trouble selling products.

Cossman started selling spud guns. Spud guns were little toy guns
that used potatoes as bullets. You simply dug the barrel of the
spud gun into the potato and when you pull it out, a small piece
of potato would stay in the barrel.

Cossman sold the spud guns through grocery stores with some
success. But he wanted to make tons of money fast. He knew by
experience that giving bonuses boosts sales. So he convinced the
grocery store owners to buy his spud guns in huge quantities at a
discount rate. The grocery owners could then give away the spud
guns for free as a bonus when people bought a bag of potatoes,
driving the sales of potatoes up.

Unfortunately, the bonus tactic didn’t work. The groceries didn’t
sell more of potatoes. And the owners were not pleased with
Cossman, from whom they had to buy the spud guns that were now
sitting in the stock room gathering dust.

So Cossman tried one more tactic. He convinced the owners to
reverse the bonus tactic. For every spud gun people bought, they
would receive 1 bag of potatoes for free. The entire “spud guns +
potatoes” package still sold for the same amount of money. But by
reversing the product and the bonus, the sales of spud guns and
potatoes went through the roof!

Cossman revealed that giving a bonus with your product can boost
sales as it provides one more reason to people to buy your
product.

But the bonus should be something that people want. People didn’t
want the spud guns. So they didn’t buy potatoes for a free spud
gun. But they did want potatoes. And they bought lots of spud
guns for a free bag of potatoes.


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Psychologist Priya Raghubir reveals what 
kind of baubles you should NOT give away

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Priya Raghubir is a social psychologist and a published writer.
One day, she decided to observe how people value bonuses on
products.

She got 2 groups of people to take part in an experiment. The
people weren’t told what the experiment was about. One group was
given a catalog that featured liquor as the target product and a
pearl bracelet as a bonus gift. And the group members were then
asked to evaluate the desirability and the value of the bonus –
the pearl bracelet.

The other group was given a catalog that had the main product as
the same pearl bracelet. And were then asked to evaluate the
desirability and the value of the bracelet.

The findings reveal some amazing insight. The second group valued
the bracelet much higher. Their desire to buy the bracelet alone
was also more.

Peoples’ valuation of the bracelet lowered when it was bundled as
a bonus!

Even though bonuses might make more people buy your products,
people will perceive the bonus product itself to be of low value.
So it might be a good idea to not to offer your own products as a
bonus and instead offer some one else’s products as the bonus.


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Waiters show HOW to give away baubles

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Most waiters have it tough. They earn minimum wages. And they
would be under the poverty line if they wouldn’t earn enough in
tips. Many experiments have been conducted to see what increases
the amount of tips a waiter received. Cornell University’s
hospitality department conducted one such experiment. The
researchers tried to determine how rewarding the diners at the
end of the meal affected the tips.

What the researchers found surprised them

   * When the diners were given one single candy after the meal,
     the waiters received a healthy tip of 15.1%

   * When the diners were given a bigger reward: two candies
     after the meal, the waiters received 19% in tips.

   * But when the diners were initially given one candy and then
     spontaneously offered another candy just before they paid 
     their bills, the waiters received a whooping 23% in tips!

In both the 2nd and 3rd case, only two candies were given to the
diner. But the way they were given increased the tips by an
awesome 4%!

The experiment shows that the bigger the reward the better the
client response.

And the response can be even better when you surprise the clients
with a reward.


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Action summary:

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   * Give away bonuses and rewards (baubles) to make people buy
     your products over your competitors.

   * Give away only those bonuses that the consumers really want.

   * Give away some one else’s products that compliment your own
     as a bonus.

   * Surprise your clients with bonuses from time to time to make
     them buy more products from you and become loyal to you. 

Ankesh Kothari shows how small business owners can build 
a smashing brand on a shoestring budget, on his website,
http://www.BizTactics.com. Go visit the site to read more
marketing case studies with which you can blow your 
competition away... even if you have little or no money.