I think it’s great how they are doing this but I’ve always wondered why they do it it’s a very good thing though and it’s awesome.
There are many reasons. Loyalty, Brand Awareness, They have a budget for it and so on.
I won my first product in Summer 14 and won 50 Power Bucks today. It’s a great buzz and when you tell your friends they get into it, but their products which are outstanding and the business booms.
- Inventory management. If you have an over-supply, then give it away (to get the benefits below)
- New products, particularly higher cost products, a customer is nervous to buy without a review, so if you give it away to reviewers, it seeds confidence in buyers.
- Marketing is expensive, very expensive, it is a crowded market. Word of mouth is free. SO one way to get a much lower cost marketing is give free stuff away, the recipient will in general like the product and tell their friends/family and then they buy that product.
- Crowded market, simply getting noticed takes an army. “Yeah I heard of Anker” is no accident.
- Fun works. If someone is elevated from a straight product purchase for money scenario, it humanises the transaction in a forum, more of your feelings and less of your logic is engaged, so you tend to buy.
The Inventory Management piece is key given this is a made-in-China product which is shipped from Amazon, the product exists close to the end-customer (it has to, it gives it a commercial value to be able to say same-day or next-day particularly if free postage with Amazon Prime), so if you have a little over-supply in one product, a quick competition gets it out there and does more good (with fun, friends, family, etc). The $10-$30 average selling price with a product portfolio which changes constantly means any over-stock can become of little value due to the successor, so you can use discounts to ship product before it becomes replaced, so you earn more total $ revenue overall.
Well thought out response to a simple question.