College football kicked off only a day ago and there are already some big winners and big losers in the betting world. On August 29, 2014, ESPN reported that Ashley Furniture in College Town, Texas owes customers $1 million dollars because of a promotion they were running. To some people, this might have been a boneheaded move on the part of Ashley Furniture but those who know business know otherwise.
The promotion being ran by Ashley Furniture in College Town, TX offered to pay for all furniture purchases made between Aug. 16 and Aug. 27 if the Texas A&M Aggies beat the South Carolina Gamecocks by at least 10 points. The Aggies were a 10 point underdog to the favored Gamecocks. It just so happens that the Aggies not only covered the spread but beat the Gamecocks by a final score of 52-28 which is a 24-point win.
More than 600 people took the bet against Ashley Furniture and purchased furniture hoping for the Aggies to cover the 10-point spread. Those 600 purchases added up to around $1 million dollars in sales that Ashley Furniture has to reimburse customers for. One customer was so confident the Aggies would cover he purchased $20,000 worth of furniture during the promotion.
“We’ve wanted to do this for three or four years now,” said owner Mark Wilks, whose Ashley Furniture store is an official sponsor of Aggies athletics. “This was really good for us.”
According to Wilks, the promotion gave the store its best month of sales it has had in the 8 years it has been open.
Luckily, Mr. Wilks will not have to worry about his Ashley Furniture store going out of business because of the promotion. He was smart enough to take out insurance against the gamble, so he will only have to pay out 15-percent of the total reimbursement and insurance will cover the rest.
This is one gamble that most assuredly paid off for Ashley Furniture. After they pay out the $150,000 insurance fee they will still clear $850,000 in sales for an 11-day promotion. After seeing this example it will be interesting to see if any other major companies run similar types of promotions during the rest of the college football season.
Which companies would you like to see run promotions like these and what would you like to see them offer? Which games would you like to see promotions like these being ran? Would you take the risk and make a purchase during the promotion hoping to win and get reimbursed? Sound off in the comments section below and try to be as realistic as possible. Maybe one of the companies will take notice and you will see your promotion being ran in the near future.