From the November 2005 issue of Entrepreneur

"People come in with trade-ins because they don't want to pay retail [for a new bike]," says owner Rich Staley, 36. "They get a discount when they bring their old bike to trade in, and we get more people in the shop."

"Trade-ins foster loyalty, especially if you're doing it in an industry where no one else is," says Kevin Eikenberry, owner of The Kevin Eikenberry Group, a customer-service consulting firm in Indianapolis. He says trade-ins work for almost any kind of company and can build your business in several ways, including:

  • Giving customers a reason to buy: There's less guilt asso-ciated with trading in an old-but-functional refrigerator if the customer knows he or she will get a discount on a new one, says Eikenberry. Plus, it solves the issue of what to do with the old product.
  • Encouraging loyalty: Customers will be reluctant to shop elsewhere if they know they'll get a discount from your shop by trading in their old version of what you sell.
  • Providing additional revenue streams: Staley makes his money back and then some by selling the used bikes for parts.

Quick Pick
Trying to find the decision-maker at that hot prospect? Jigsaw Data Corp. is a fast-growing online marketplace for buying, selling and trading business contact information. Members exchange the contacts they have for the contacts they need and are given point-based incentives to keep the information up-to-date. That means over 1.2 million contacts from over 93,000 companies are constantly being revised. Contacts are mostly from the U.S., but Jigsaw launched a global initiative in June. The cost is $25 per month, which can also be paid in point incentives if you've gathered enough. Test-drive Jigsaw with a free trial, which allows you to access up to 10 contacts.

The market for product placement in video games and advergames will reach
$260 million
by 2008.
Statistic Source: The Yankee Group
52%
of consumers are somewhat or much more likely to purchase a product seen in a commercial vs. one featured in a product placement.
Statistic Source: FIND/SVP