Sunny Co Clothing - The small Instagram account with 7k followers, announced a giveaway of their $64.99 worth swimsuit, to anyone who reposted and tagged their photo, within the next 24 hours.

Strategy & Tools

Highlights

• May 3rd, 2017 - 2 students, Alan Alchalel and Brady Silverwood posted a picture to their Instagram fan page with a giveaway deal
  
  
• May 4th, 2017 - they "sold" 50k of swimsuits, gained over 745k new Instagram followers, and 650k dollars from the shipping costs

Simplicity at its finest

Alan and Brady didn't overcomplicate things.
Clear, simple rules were essential to get people participate in the giveaway.

1. Repost the @sunnycoclothing picture - viral factor
2. Tag your friends - additional viral factor
3. Do it within 24 hours - urgency

Adding these 3 factors into the giveaway equation made Sunny Co Clothing Instagram profile blow up almost instantly.

Attractive product

The photo and the swimsuit looked exceptionally well!
Actually, the image looked like any typical post their target audience would share, rather than a spammy ad.

The attention grabbing red-colored swimsuit, good looking model, and the swimming pool, did the job.

PLUS, the perceived value for the swimsuit was $64.99 (that's the price of the swimsuit on Sunny co Clothing website), which made a great deal to get it for free. 

Product niche

How often do women purchase swimwear for themselves?

• 34% of women from the U.S. buy swimwear at least once a year
• 7% at least once in six months
• 2% at least once every month

Now that's a big niche to take on. 

Free + shipping model

The giveaway told people that they could get a $64.99 worth swimsuit for free. All they needed to pay for is shipping, which sounded reasonable.

Let's see the numbers behind it:
People were paying $13 for shipping
The total cost of a single swimsuit was about $7.20, including:

1. $3/piece - You could get the same swimsuit on Alibaba - if you negotiate a quite large order (50k in this case)
2. $3/piece - Costs of shipping across the U.S.
3. $0.50/piece - Factoring/branding
4. $0.70/piece - Processing fees
5. $3+$3+$0.5+$0.70=$7.20

Profit:

• $12 - $7.20 = $5.80/piece
• $5.80 x 50,000 = $290,000 Profit

Building an audience = more potential future profits

Aside from the giveaway, Alan and Brady managed to create a proper brand with 745k Instagram followers and 50k+ emails (from purchases) within just 24 hours!

These stats alone are worth A LOT!
Let's see the math (rates from 2017):

• An email list of 50,000 subscribers

  • The average revenue per email subscriber is often reported to be around $1 per month (This is a rough estimate and can vary significantly based on various factors)

  • Statistically, this would mean an additional $50k a month, and $600k a year

• 745k Instagram followers

  • It's even harder to predict the revenue coming from social media followers, so we will look into earning from influencer promos and "shot outs"

  • A single post promoting someone else’s product or service on an "influencer" page costs aroung $1 per 1,000 followers.

  • Sunny Co Clothing could get a minimum of $700 for a single promoted post. Looking at 1post/day would make an additional $21k a month, and $252k a year.

The result: an additional $852k a year

Psychology

Yearly Trend
May is one of the best months in a year to sell swimsuits. The summer is just behind the corner.

The second-best month in a year to sell swimsuits is February. Students are preparing for the spring break.

See it here

Scarcity
A limited time offer makes the swimsuit even more important and valuable. It makes the customers act now, because the same deal might not happen again.

Bargain mentality
People are hunting for the thrill of a bargain. They’re craving that feeling of being a successful shopper. They want the thrill of feeling like they scored a big victory.

Why Free works?
People change their behavior when something free comes along.
Free isn’t just a price. It’s a very powerful emotional trigger.

• Zero Price Effect
  When customers pay for something, they calculate the risks of any dissatisfaction they might get from that product.
  They have no expectations of free products, whatsoever.
  Free things are considered to have a higher value because the risk of dissatisfaction and value for money is eliminated.
  
  
• The Reciprocity Principle
  People pay back what they've received from others. 
  In this case, the free swimsuit felt like a reward to customers. That's why they felt obliged to pay for the high shipping costs.

Last few words

It isn't 2017 anymore. Nowadays, people are more skeptical when they read the word "free", but trust me...

Free giveaways are everywhere and are still hot AF!

Free giveaways are one of the fastest ways to building your email lists.

Free products not only improve the consumers’ overall perception of the business, but it also serves as a great way to acquire new customers using the principle of reciprocity.