Retailers turning to product give-aways to lure shoppers to their websites

Story from Here & Now. Listen to the above audio for a complete report.

As the economy lurches along, retailers are looking for ways to boost holiday sales.

Here’s one idea: give the stuff away. That’s not as crazy as it sounds. Some online retailers are giving away products, “You just pay shipping and handling,” in hopes that a coupon or some other hook that comes in the package will get you back to their website when you go to make your holiday purchases. 

Stauer, the online jeweler, will lose money on a deal that gives away a 170-carat amathyst necklace (http://www.stauer.com/itemd.asp?ItemNo=21463), in exchange for the purchaser paying shipping and handling. 

Britt Beemer, chairman of America’s Research Group, a research marketing firm, said these sorts of tactics are what retailers will have to do to stand out in the crowded and stagnant retail environment.

Foot traffic is expected to drop 2 percent this year.

“They’re trying to be able to enhance their customer service image,” Beemer said. “They’re trying to get more people to visit their websites.”

Beemer also noted that inventory levels are up 4 to 5 percent over last year, and with traffic expected to be down, retailers are staring the possibility of having to move substantial product at a deep discount after the holiday season.

Many retailers, including Best Buy, are already looking at ways to hold the line on costs. At Best Buy, they’re adding few if any holidays staff this year.

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