More companies are pitching to folks who fear being laid off, or already are
Companies looking to give a jolt to sales are aiming squarely at the fear factor. Automakers, airlines, and clothing retailers, among others, are trotting out a slew of guarantees, rebates, and freebies pitched at those who worry about getting laid off. In fact, the practice has become so prevalent that consultants have already coined a term for it. "We are calling this 'altruism marketing,' " says Michael J. Silverstein, a senior partner at the Boston Consulting Group in Chicago, who estimates that at least 100 major companies have such marketing programs in the market or ready to launch.
For companies desperate to part skittish customers from their cash, it's a win-win proposition. Most of the programs require little if any additional spending. And even if sales are few, there's tons of good PR. But if offers of free suits and complimentary health care for laid-off workers sound too good to be true, it's because sometimes they are. Read the fine print and you may find you'll need to produce reams of documentation to prove that you're down on your luck.
The carrier is fighting the so-called staycation trend with its "promise program." JetBlue (JBLU) will completely refund the cost of tickets purchased between Feb. 1 and June 1 for ticket buyers who lose jobs. While the airline won't say how many people are signing up, a spokeswoman says refunds will be available for up to nine people sharing an itinerary.
In December, Hyundai kicked off a program that lets buyers who lose their jobs in their first year of ownership return their car with no harm to their credit. In March it sweetened the deal, offering to make three months of payments before reclaiming the car. Sales rose 0.5% in the first quarter. General Motors (GM) and Ford (F) have since launched similar schemes.
BANK OF AMERICA
The nation's largest bank (BAC) in April introduced fee waivers for customers who have lost their jobs. It will waive monthly account maintenance fees for three months and refund or waive insufficient funds and overdraft fees on a case-by-case basis. The bank also will soon roll out a $10 fee for small overdrafts for all customers—a bargain compared with its usual $35 charge.
JOS. A. BANK
The men's clothier (JOSB) promised to refund the cost of buying a suit during its $199 sale from Mar. 16 to Apr. 9—and let the customer keep the threads—if he loses his job before July 1. But there's a ton of paperwork involved. University of Chicago marketing professor Jean-Pierre Dubé is betting the company will win out, as consumers often can't be bothered to file for rebates.
FedEx Office (FDX) invited job hunters to print their résumés free of charge at more than 1,600 locations on Mar. 10, its first nationwide free print program. Nearly 24,000 people showed up and printed more than 853,000 copies. At roughly 20 cents a page, the giveaway amounted to some $200,000 in foregone revenue. The company says it might repeat the exercise.
Lose both your job and your health insurance? On Apr. 1, Take Care clinics in 343 Walgreens (WAG) stores started seeing existing patients gratis from 11 a.m. to 3 p.m. weekdays as long as they show they're unemployed and uninsured. Co-founder Peter Miller says data systems pinpointed when the clinics weren't busy and could offer free care at minimal additional cost.