What Is a Gift with Purchase?

A gift with purchase (GWP) offer is a sales promotion tactic. Businesses provide customers with a free or heavily discounted product when they purchase an item. This incentive typically encourages customers to buy a particular product or spend a certain amount.

The gift can be directly related to the purchased product (for example, a moisturizer with a face cleanser) or a completely different product (like a tote bag with any $50 purchase). Sometimes, GWPs are also used for services – like a spa offering a complimentary head massage for booking a specific package.

Key Takeaways

• A gift with purchase is a special promotion that businesses use to encourage customers to buy more (expensive) products. More rarely, GWPs are used to entice buying a specific service. 
• Product-based GWPs are more common because they’re typically easier to deliver and manage from a logistics perspective.
• The gifts can directly relate to the purchased product or a completely different product or service.
• GWPs are a popular marketing tool across various sectors, prominently within the beauty industry. Brands like Estee Lauder and Clinique offer value-driven gifts with purchases.
• The gifts must enhance the purchased item’s value or provide an additional benefit.
• The gifts typically include complementary products, limited-edition items, and useful accessories.
• To qualify for a GWP, customers usually need to hit a minimum purchase threshold or buy specific items during a promotional period.
• The return policies for GWP items vary by retailer. Some businesses require the gift to be returned if the qualifying product is returned. Others deduct the value of the gift from the refund if the gift is kept.
• Some businesses may allow customers to receive multiple gifts with a single purchase, depending on the specific terms and conditions of the offer.
• Businesses use GWP marketing strategies to increase customer satisfaction, enhance the perceived value of the purchase, and potentially create brand loyalty & drive repeat business.

Gift with Purchase Definition

GWP involves offering a complimentary item as an add-on when a customer meets the purchasing requirements. These promotions can be found across various sectors, most prominently within the beauty industry. 

Well-known brands such as Estee Lauder and Clinique tend to offer value-driven gifts with a minimum purchase amount, which include:

• Skincare products
• Lipstick
• Mascara
• Makeup 
• Serums
• Cosmetic bags
• Other beauty tools

Gift with purchase offers have evolved from simple sample giveaways to sophisticated marketing strategies that boost sales and enhance customer loyalty. Brands often use GWP deals to introduce new products, clear inventory, or drive traffic during slower shopping periods.

History and Evolution of Gift with Purchase

GWP used to be a gimmick, but it’s now a full-on marketing strategy for driving customer loyalty and promoting sales.

Early Days

Free gift programs have their roots in the 20th century. However, giving away something extra with a purchase has been part of commerce for centuries. 

Estée Lauder, the co-founder of the cosmetics company that shares her name, is famously linked with the popularization of the GWP marketing strategy. In the 1950s, rather than spending money on traditional advertisements, she invested in giving away product samples with purchases. The idea was that once customers tried and liked the products, they would be more likely to make a full-sized purchase.

Another early adopter of this marketing tactic was the jewelry company Napier in 1982. They provided customers with complimentary items upon purchasing their jewelry. 

Modern Days

The concept of GWPs has expanded vastly in modern commerce. The fragrance market has seen a significant increase in the use of GWPs, particularly around the holiday season when gift sets could account for a larger percentage of sales. 

The practice is now prevalent in various sectors, like makeup and electronics. In the beauty industry, GWPs can be as small as a sample-size product or as significant as a full-size item accompanying a sizable purchase.

Why Do Businesses Have GWP Offers?

As attractive as gift with purchase offers are to customers, they also provide valuable data and insights to marketers. This helps brands understand customer behaviors and preferences.

A GWP strategy can lead to increased average order value, improved consumer satisfaction, and the potential for long-term engagement. Let’s take a short deep dive into what GWP deals bring to the table.

GWP Enhances Customer Satisfaction

GWP promotions can significantly improve customer satisfaction. Getting an unexpected “extra” can make customers feel valued and special. Gifts reflect a company’s generosity and desire to “give back” to their customers, contributing positively to the shopping experience.

GWP Increases Perceived Value

When customers receive a gift with their purchase, the perceived value of the transaction increases. The surprise element of an extra product or service makes customers feel they got more than they paid for, creating a sense of gain. Perceived value-adds can often lead to higher customer loyalty, creating repeat purchases.

GWP Encourages Higher Spending

Gift with purchase offers usually have a minimum purchase requirement. However, customers tend to be willing to add more items to their cart to qualify for a free gift. This encourages higher spending, increases the transaction value, and boosts overall sales for the business.

GWP Facilitates Inventory Management

GWP deals can also help with inventory management. If a product isn’t selling as expected or the business wants to clear out seasonal inventory, it can include those items as a free gift. This helps move the inventory without the need for aggressive markdowns, while also making customers happy.

GWP Creates Brand Loyalty

GWPs can enhance customers’ brand perception, as the free items create a sense of appreciation and value. Satisfied customers are more likely to return for future purchases, knowing they might receive an additional benefit.

GWP Is a Market Differentiator

Gift with purchase promotions distinguish a brand from competitors by offering something extra that the others do not. Free items can effectively introduce customers to a product line they have yet to consider. Besides, GWP also comes across as unique offers, and customers tend to appreciate exclusive or limited-time gifts that resonate with their needs.

GWP Increases Sales

Free gift deals often lead to higher transaction values, as customers are motivated to reach specific spending thresholds. For instance, an average order value of $50 could be transformed to $65 if customers would receive a free item for purchasing items for at least $60.

Shoppers might also be inclined to purchase higher-priced items when a GWP campaign is active.

Types of Gifts with Purchase

Businesses typically curate exclusive items for gift with purchase promotions. Such items must appeal to customers and align with the brand or product value. Three common GWP types are:

1. Complementary products
2. Limited edition products
3. Accessories

Complementary Products

Complementary products are gifts directly related to the item being purchased. They enhance its use or provide a more complete experience. For instance, when customers buy a shampoo bottle, they may receive a matching conditioner. 

Or, purchasing a new smartphone might include a complimentary case or a pair of earbuds. This strategy adds value by incentivizing using both products together for better results.

Limited Edition Items

Limited edition items have an inherently exclusive feeling. They’re a natural gift with purchase fit since they’re often one-of-a-kind or available only for a short period. This can significantly drive customers’ desire to purchase. 

For example, a beauty brand may offer a limited edition palette of eyeshadows with the purchase of a fragrance during a holiday season. This creates a sense of urgency to acquire something rare and valuable.

Accessories

Accessories provided as gifts with purchase could be broadly useful – not necessarily tied to the product bought. Customers may receive practical items like water-resistant totes, pens, or thermos bottles.

Even if accessory gifts do not correlate with the main product’s function, they’re still desirable due to their utility in everyday life. Accessories offered as GWPs can also help in expanding brand visibility as they’re likely to be used in public.

Gift with Purchase FAQs

What Is the Gift with Purchase Meaning?

GWP promotions are a popular marketing strategy that attract customers and drive sales. Customers receive a complimentary product or service when purchasing another product or service. Generally, there also tends to be a minimum spending threshold to receive the GWP.

How Do I Qualify for a Gift with Purchase?

To qualify for GWPs, customers usually need to purchase a minimum amount of products or buy specific items during a promotional period. Brands often set these requirements to incentivize higher sales volume or the trial of new products.

How Do Brands Benefit from Offering Gifts with Purchases?

Businesses benefit from these promotions by enhancing the perceived value of a purchase, encouraging customers to buy more, and introducing new products. GWPs can also help in building brand loyalty and customer retention.

How Are Gifts with Purchases Promoted?

As GWPs are marketing campaigns, they use the typical online and offline promotional channels. For example:

• In-store signs & online banners: GWPs can be highlighted using clearly visible advertising materials.
• Email campaigns: some companies might send targeted emails to existing customers with personalized messaging about the promotion.
• Social media: social media platforms can be leveraged to create buzz around GWP offers, possibly employing influencers to extend the reach further.

Can You Receive Multiple Gifts with a Single Purchase?

Some brands allow customers to receive multiple gifts with a single purchase, particularly if they surpass various spending thresholds. However, it depends on the specific terms and conditions set by the business. 

Some brands might limit their GWP offer to one gift per transaction, regardless of the amount spent. In such scenarios, even if the customer’s purchase substantially exceeds the minimum spend threshold for the GWP, they would still receive just one gift.

What Items Do Beauty Retailers Offer as Gifts with Purchases?

Beauty retailers typically offer sample-sized products, full-sized products, cosmetics bags, or limited-edition items as GWPs. These items are selected to complement the main purchase and provide an added benefit to the promotion.

Can I Choose the Gift I Receive with My Purchase?

This often depends on the specific offer. Some businesses allow options for the gift product, especially in cases where there might be color or size preferences, like in clothing or cosmetics. However, in other instances, the company may pre-determined the gift.

Can I Return the Purchased Product but Keep the Gift?

Return policies for GWPs vary by retailer. Some businesses may require you to return the gift if you return the product that qualified you for the GWP. Others may deduct the value of the gift from your refund if you choose to keep it. Read the return policy carefully or ask a customer service representative for clarification.