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“A BigMac for $0.99 please” 

“Anything else?” 

“Yeah, a big Diet Coke, French fries, and you know what? Throw a Sundae in there too” 

“Ok, and your total is $9.99”

 

How many times have we done this? And what just happened? Let’s take this specific example. McDonald’s sponsor and advertise promos that are irresistible (such as a Big Mac for $ .99) and users can’t really say no to this. This is what in Commerce marketing we call “TripWire”. A tripwire, even though it may sound a little sinister, it’s a product or a service that turns prospects into leads by making them a low-cost, relatively painless offer. Then organizations will have an opportunity to upsell once the consumers are in your sales funnel. So, in our example, McDonald’s doesn’t make any money on the BigMac (actually they may even sell it at loss) but that is their lead generation strategy. It’s the hook that gets users to step into the store. They know then that every customer’s average spend is around $10, therefore the main marketing effort for each McDonald’s outlet is to increase footfall. 

 

What does it mean for us marketers?

Although McDonald’s operate very much on a brick-and-mortar level, the example can be very well applied to a digital strategy for our organizations. Let’s assume that our client wants to increase sales through Ecomm. What is our top funnel strategy? And how do we lure prospects into the process? And most of all (on a large scale) how much $ value does an average prospect consumer generate for the organization? These are all valid questions that we need to ask ourselves when we design marketing campaigns because such a very simple financial exercise, will dictate the marketing offers that we can provide to our users. Did you ever wonder why almost all commerce platforms welcome you with a message “Sign up today and save $10 on your first purchase”. That $10 is not random. They know that an email address, in this case, has a higher value for the business than the $10 that they give away. As much as McDonalds know that the money that they don’t make on the BigMac is going to be recovered on the average order value spent by their customers. 

Of course these strategies through tripwires are very effective to increase immediate sales, but in the long run, they will dilute the value of the brand. So we as marketers need to be careful in balancing out the long term goals with the short term needs of an organization.

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