BOGO Promotion Definition
BOGO (“Buy one, get one free”) campaign is a sales promotion type that gives a free bonus item with the purchase of the same or another item of higher value. For example, a cosmetics brand can offer a free eye shadow with each purchase of its premium lip gloss.
BOGO promotions can bundle complimentary items or the same types of items or items that are targeted at the same audience but are not complementary. BOGO deals are typically implemented as in-cart promotions, which means that they are applied automatically to the customer’s cart, without the need for a coupon code. However, BOGO deals can also be implemented as coupon campaigns, which means that a customer has to place their promo code at the checkout first to activate the BOGO offer and claim another item for free.
As one of the most attractive price promotions, BOGO campaigns are a must in the promotional catalog of most brands.
What are the benefits of running BOGO promotions?
- BOGO campaigns help to clear the unwanted inventory faster. If you offer fast-moving goods together, you can sell them out quicker.
- It is an effective way to upsell and cross-sell products.
- It is an effective way to boost the AOV as customers will buy bundled items from you instead of separate products from different stores.
- It increases convenience for customers and they are more likely to spend more upfront.
- You can get a higher initial return on the cost of acquiring a customer.
- As it drives bigger orders, it helps with the optimization of shipping costs and logistics for each order.
Best practices for running effective BOGO deals
- Make the promotion time-limited – by putting a time limit on the BOGO campaign, you evoke urgency and are more likely to convert customers faster.
- Highlight the value – to make your offer perform better, you should clearly display the value customers are getting from the promotion.
- Personalized your offer – if you have a proper infrastructure in place, you can try to personalize BOGO deals to each user or to selected segments based on demographic data, such as age, gender, or occupation.
- Protect your margins – you never want to lose money with a BOGO deal. However, without proper security checks, the BOGO campaign can burn your margins fast or negatively impact other products.