In 1992, vacuum manufacturer, Hoover, launched a free flights marketing promotion in the U.K. to boost sales. Customers who bought at least £100 in Hoover products would receive two free roundtrip flights to the US or Europe via a small travel agency, JSI Travel, which was looking to offload cheap flights.
Hoover already knew that if too many people took part in the promotion, it would be a disaster, so it complicated the process in various ways. If customers got through these arduous steps, the company reserved the right to reject their choice of destinations and would give them other options. If those didn’t work, they couldn’t participate.
Hoover assumed customers wouldn’t be willing to go through all this, but they were and they kept buying the products. The company saw the writing on the wall and began thinking of ways to swindle customers out of their rewards, resorting to everything from telling them they filled out the forms incorrectly to choosing airports hundreds of miles away from where they lived.
Customers finally revolted: Thousands formed a coalition against the company and one even held a delivery van hostage. Hoover pointed fingers everywhere, but eventually, the president, VP and marketing services director of the company’s U.K. division were sacked. Hoover incurred a staggering loss of £23.6 million in sales in 1993 and its American parent company, Maytag, was ordered to pay $72 million in flights to customers.
On top of everything else, people found themselves in possession of Hoover products they didn’t want or need. The resale of these items in second-hand stores enabled prospective customers to acquire brand-new products at a fraction of the cost at which Hoover was selling them.