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28 December 2004
Taking a Loan to go Travelling
The Singapore Tourism Board had a problem, they knew that the burgeoning middle class professionals in India had such a thirst for traveling, and that Singapore was regarded as a destination worthy of their time and money. Unfortunately, they are hesitant to spend a big chunk of their monthly salary on a sightseeing trip. A classic “I want it but I don’t need it” scenario.
The Solution
They made it easy for them to travel to Singapore by tying up with a bank to offer interest free 2 year installments, and an airline to offer good rates to fly to Singapore. Suddenly, the ‘want’ became a ‘need’, and a pressing need. Within a month from the launch of the program, 100 people signed up for the package.
The idea is not exactly new, since furniture and household appliances retailers have been using installment schemes to good effect for a long time. So have car and house purchases. However, applying it to an industry that previously has relied on a huge one-time payout is a great marketing idea.
The other marketing lesson to take from this story: A “want” can be made to become a “need” if the product is made more accessible, in terms of cost or availability. The distant want becomes a need that can be satisfied instantly, and people will satiate their needs when they see they can afford to. Buying that high end sound system for $4,800? No way. But pay $200 per month for 2 years to enjoy that crystal clear sound quality? Hey, that sounds manageable.
So providers of products and services that require a high initial cash payment, maybe it is time to take a leaf out of the marketing resource books of others.
Source : Straits Times
Ian Choo, 28 December 2004
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December 2004
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