Stand-alone sale of a free gift: Is it effective to accentuate promotion value?

Offering a free gift when a purchase is made is one of the most pervasive marketing practices. We investigated whether making the product offered as a free gift also available for sale by itself (i.e., a stand-alone sale of the gift product) accentuated the customer’s perception of the value of the promotion. Previous research on value anchoring and adjustment predicted that a stand-alone sale of a gift would increase the promotion value, whereas the opposite was predicted in the scarcity perception literature. We conducted 3 empirical studies with 330 undergraduate students in Korea, and the results supported the scarcity hypothesis: The availability of a stand-alone sale decreased the perceived scarcity of a free gift which, in turn, reduced the value of the promotional offer and discouraged our participants from joining the promotion program. Our findings suggest that the effectiveness of a free gift promotion is enhanced when the gift is not available as a stand-alone product.