History Lessons

Do the math - Hoover. If something sounds too good to be true, it usually is

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Last Updated: 09 Oct 2013

If something sounds too good to be true, it usually is. Hoover learnt this the hard way when in 1992 it ran a promotion offering a free pair of return flights to Europe for customers who spent £100. The costs, thought Hoover, would be covered by getting customers to splash out on lucrative extras. The offer attracted Brits like bees to honey – Hoover's travel agents couldn't keep up with demand. But too few customers coughed up for the extras and the numbers just didn't add up. Incredibly, as the company's phone lines melted, Hoover expanded the offer to include US flights. 'Two return seats: unbelievable!' screamed the ads. What was unbelievable was Hoover's poor management of the promotion. The company was inundated with frustrated customers – one even kidnapped a Hoover van in protest. They eventually took Hoover to court, which cost it £48 million – never mind the bad publicity. The lesson? Don't over-promise, and always run the numbers properly.

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