BOGO Promotions Explained: Why Buy One Get One Deals Work And How To Use Them?

According to Convince&Convert, about 93% of customers use at least one coupon or a discount code throughout the year. Accordingly, discount promotions are what motivates almost every consumer to make up their mind and finally purchase something.

If you are looking for a particular marketing strategy to incentivize shoppers and boost revenue of your e-commerce business, BOGO is a perfect solution for you!

What does BOGO promotion mean?

BOGO simply means "buy one, get one." It is a sales promotion during which shoppers are offered a free or a discounted product (for instance, they only pay half the sum) when another product of the same or higher value is purchased. BOGO can certainly serve as an example of a bundle discount.

Why is BOGO promotions effective?

Buy-One-Get-One (BOGO) promotions are incredibly popular with consumers, and it’s not hard to understand why. A study published in the Journal of Business Research found that shoppers often prefer BOGO deals over equivalent price discounts. These offers tend to grab more attention and are chosen more frequently, particularly when the savings are substantial.

The appeal of BOGO deals goes beyond the numbers – they tap into a strong psychological draw. Getting an additional item for free creates a sense of added value and satisfaction, making the deal feel more rewarding.

The psychology of "free" and the Zero Price Effect

As in the words of Dan Ariely, the author of Predictably Irrational, "zero/free is a source of irrational excitement; it's called the 'zero price effect.'"

In one of Ariely's studies, consumers were offered two options: to buy a Hershey Kiss chocolate – a common, inexpensive treat – for 1 cent or to buy a Lindt Truffle – a more refined and more expensive type of chocolate – for 15 cents. Given the quality of the products and the offer's value, nearly 3 out of every 4 participants chose to buy the Lindt Truffle.

In the next part of the experiment, the price of both items was reduced by 1 cent – the Lindt Truffle's price was 14 cents and the Hershey Kiss was free. Within this model, 90% of participants opted for the free Hershey option, even though the price difference between the products was the same.

The experiment proves that people do not simply set costs and benefits against each other but rather focus on acquiring a free product. This is exactly why a BOGOF deal is effective – the thought of getting something for free incentivizes customers to shop. The complimentary item is often overvalued in their eyes, even when it is juxtaposed with a higher-quality product at a discounted price. 

Additionally, BOGO promotions are usually introduced only for a limited period of time which creates a sense of urgency among customers convincing them to shop.

Beginner's Guide to Promotions Psychology

• Learn the top-secret methods for boosting promotional campaigns.
• Thumb through plenty of tested marketing and sales psychology tricks. 
• See examples of how global brands use marketing psychology in their campaigns.

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Examples of BOGO promotions

1. Burger King – free product with an eligible purchase

Burger King offers a free Whopper (regular or plant-based) with the first purchase via Click & Collect method (order online, collect at the chosen restaurant) of minimum £3. The promotion applies when the Whopper is added to cart along with other items so the total for the order is above £3.

2. Publix – automated BOGO deals

Publix offers their customers a different BOGO item twice a week. During the holiday week, the product offered within the promotion is shelled black eyed peas. Along with the typical BOGO sale, Publix also offers promotions such as 'buy two for [a certain amount]' to their customers.

3. Famous Footwear – buy one, get one 50% off

Famous Footwear frequently runs BOGO promotions at their stores. When customers buy two pairs of shoes, the other one – of equal or lesser value – is 50% off.

4. Subway – free sandwich with a specific order

For World Sandwich Day in 2018, Subway offered a good deal on their sandwiches – buy one 6-inch sandwich + 22oz drink combo, get one 6-inch sandwich for free.

5. Linen Chest – Buy one, get one 50% off (including on-sale items)

Linen Chest offered their customers a BOGO sale during which they were able to get a second product 50% off and that included items which were already on sale. The deal was introduced automatically when customers proceeded to checkout with two items. No BOGO coupons necessary here.

6. Coca-Cola Embonor – versatile BOGO deals

Coca-Cola Embonor created a variation of BOGO sale, particularly a bundle discount: buy 6 cans of 220ml each and pay for 5.

Especially for the holidays, Coca-Cola Embonor introduced yet another BOGO offer – when buying any beverage in a returnable container, you can get a package of 6 Christmas ornaments for half price.

The discount appears after the beverage (at least one) and the Christmas decoration package are added to cart. Instead of $5,000, the ornaments then go for $2,500.

Coca-Cola Embonor introduces many more promotional offers which reward their loyal customers and incentivize new ones.

7. Domino’s Pizza – BOGO Tuesdays

Domino's frequently runs a popular promotion called "BOGO Tuesdays." On this day, customers who purchase one pizza at the menu price receive a second pizza of equal or lesser value for free. This deal is available for both delivery and carryout orders, making it accessible and convenient for customers.

Why are BOGO promotions worth it for your business?

1. Streamlined inventory management

BOGO promotions are a highly effective way to clear out excess stock, seasonal inventory, or products approaching their sell by date. By offering a free or discounted item, businesses can quickly move inventory that might otherwise remain unsold.

Additionally, BOGO promotions encourage up-selling and cross-selling by enticing customers to add complementary products to their carts. For e-commerce stores, this can result in higher order values and better inventory turnover rates.

2. Convenient and flexible implementation

BOGO promotions can be implemented at the cart level, where the system automatically applies the discount (e.g., a free or half-priced second item when added to the cart), or via promo codes entered at checkout. This flexibility allows businesses to customize their marketing campaigns to target different consumer behaviors and preferences.

3. Preserves brand perception and product value

Unlike traditional discounts, BOGO promotions do not diminish the perceived value of your products. For instance, offering a 50% discount on a single item might make customers associate your brand with lower prices or diminished quality.

With BOGO, the primary product retains its full price, while the discounted or free item feels like an added benefit. This approach helps maintain your brand’s value proposition and ensures that customers still perceive your products as premium and worth their full cost.

4. Enhanced profit margins through volume sales

While it might seem counterintuitive, BOGO promotions can actually help protect or even improve profit margins. The cost of the free or discounted item is often offset by the increased sales volume, especially when the promoted products have strong profit margins to begin with. Additionally, customers are more likely to purchase other full-priced items while taking advantage of the deal, further driving profitability.

5. Optimized logistics and shipping

BOGO naturally encourages larger orders by promoting product bundles, which simplifies order fulfillment. Bundling items together makes packing and shipping more efficient, reducing handling time and lowering shipping costs. For businesses that manage high order volumes, this logistical optimization can lead to significant savings and faster delivery times, enhancing the overall customer experience.

What are the best practices for BOGO discounts?

1. Set clear conditions

Clearly communicate the details of your next BOGO promotion, such as eligible items, exclusions, and any stock or time limits. This transparency not only makes the deal more attractive but also enhances customer trust and loyalty. To protect your margins, consider adding minimum order value or validation rules for cart content.

2. Tailor BOGO deals to your audience

Create BOGO offers that resonate with your target customers. For example, offer complementary products that align with customer preferences. A guitar store offering a free set of guitar picks with a guitar purchase is far more appealing than unrelated items like drumsticks. Tailored BOGO deals help attract new customers while fostering satisfaction and loyalty.

3. Evaluate profitability

While BOGO promotions are a popular promotion strategy to boost sales, ensure they are financially viable. Analyze the potential impact on your bottom line and balance the discount with your business goals to make the most of the campaign.

4. Create urgency

Time-limited offers drive action. Set clear deadlines for the promotion or limit the number of discounted items available. Linking your BOGO deals to a seasonal event or holiday is a great way to encourage quick decision-making and enhance loyalty through timely, relevant deals.

5. Experiment with different BOGO formats

Not all BOGO promotions need to be "buy one, get one free." Experiment with variations like "buy one, get one 50% off" or "buy two, get one free." Testing these formats can help you determine which type of deal works best for boosting sales and attracting new customers.

6. Promote the offer effectively

Even the most attractive BOGO deal won’t perform well if customers don’t know about it. Use multiple channels like social media, email marketing, and in-store signage to promote your offer. For e-commerce, notify customers about the deal throughout their shopping journey – on product pages, cart pages, and at checkout.

Learn more: Go here to learn more about the best practices of promotions UX. 

How to create a BOGO promotion with Voucherify? 

Voucherify is an API-first promotion management tool that allows marketers and developers to tailor marketing campaigns to their exact business needs. BOGO promotions can take multiple forms and can play out in a variety of ways.

With Voucherify, BOGO offers can take the form of automatic discounts or generic and bulk promo codes. It is possible to achieve multiple results by playing around with the discount type, effect and value:

• Buy one, get one free.
• Buy one, get one 50% off.
• Buy two, get the third one for free. 
• And many more.

All promotion use cases can be then further adjusted to protect the campaign and your bottom line:

• Flexible and granular time limits that allow you to run flash-type BOGO offers. 
• Limits on the number of campaign uses per customer within a specific time frame. 
• Limits on the total order value, size and content.
• Custom business restrictions supported by metadata.

Learn more: How to create a BOGO deal with Voucherify?

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