Promotion to cost Hoover pounds 28m more than planned

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The Independent Online
HOOVER admitted yesterday that its ill-fated free flights offer had cost pounds 48m, more than double the pounds 20m it put aside a year ago to cover the cost of the promotion.

A spokesman for Maytag, Hoover's US parent, said there might be further provisions but would not quantify them. However, Richard Rankin, co-chairman of the task force set up to sort out the fiasco, pledged that when the promotion ended on 30 April, everyone who had complied with the terms and conditions of the offer would have been made an offer of free flights.

The disclosure in Maytag's full- year figures of the final cost confirmed expectations that a pounds 20m provision in last year's first-quarter figures would prove inadequate.

Hoover said 220,000 people had either flown or been booked on flights as a result of an unexpectedly popular promotion that offered two free flights to anyone who spent more than pounds 100 on a Hoover product.

The offer became a farce after thousands bought appliances solely to take advantage of the promotion. Hoover had to create a team of 250 staff overnight to cope with the deluge of applicants.

The scheme became a case study in how not to run a promotion after a torrent of bad publicity followed complaints from hundreds of customers that they were not being offered flights to which they were entitled.