The free toaster? Today, it's an iPod

"To play against NBA players--that's the biggest reason I joined," Horton said. "But they were like, 'Hey, if you join you get an iPod Shuffle,' and I was like, 'Cool, that's an added bonus.' "

To lure customers these days, marketers at corporations and small businesses are capitalizing on the iPod craze by giving away the popular digital music players made by Apple Computer. In fact, iPod Minis are the No. 1 "motivational" electronics product, according to the trade publication Incentive.

IPods come in three versions: the original ($299 to $399 for 20GB and 60GB models); the iPod Mini, which holds less music and comes in four colors ($199 to $249 for 4GB and 6GB models); and the iPod Shuffle, about the size of a pack of gum ($99 to $129 for 512MB and 1GB models).

Bank One, Chase and Citibank recently offered free iPod Shuffles to customers who opened new checking accounts and agreed to pay their bills online. Currently, Citicorp is giving away Shuffles to people who sign up for a Citi Professional Card and make $500 in purchases on the card within three months. When Procter & Gamble was trying to get preteenage girls to try its Secret Body Spray fragrances, it teamed up with the clothing retailer Limited Too for a monthlong sweepstakes in April to give away 300 iPod Shuffles.

And when Century Tower, a residential high rise in the Loop in Chicago, wanted to attract renters, it, too, turned to the iPod: Anyone who previewed an apartment and signed a lease within 24 hours received an iPod Mini.

"It went over really big," Sharon Campbell, the Century Tower's leasing director, said of the four-month promotion, which ended in May after all of the available units were rented. "People absolutely loved it. One of the first things they'd say to me after signing the lease was, 'Do I get the iPod now?'"

Capitalizing on cachet
To generate more business in the pre-iPod era, Campbell said the building offered would-be tenants incentives like one or two months of free rent, depending on the size of the apartment. "That didn't get the attention that the free iPod did," she said, even though she noted that monthly rents in the complex, which range from $755 to about $3,000, are much pricier than iPod Minis. About 80 renters received the free player.

It is unclear whether Apple cooperates with businesses offering iPod players as prizes. A spokesman for Apple declined to comment. In most cases, according to industry analysts, Apple does not take part in these promotions, and sponsors typically pay retail prices for the iPods. Claire Rosenzweig, president of the Promotion Marketing Association, said marketers hoped that the iPod's cachet would rub off onto their own brands.

"The bank or the gym, or whatever, if you're handing out a product that's really hot, you're also going to be seen as hot and exciting," Rosenzweig said. "You're going to get that shared equity. When you're trying to get attention, you're going to use a product that says to your potential customer: 'You want to do business with us.'"

At Hard Drive, a new nightclub in Chicago, iPod Shuffles plastered with the club's logo are given to the club's best customers to use as an all-access pass to the VIP room. Ryan Golden, a marketing consultant for Hard Drive, said the club chose the iPod for its VIP token because of its stylish status. "A lot of iPod wearers wear iPods as a cool badge," Golden said. "They like them to be seen with them. We wanted to translate that to VIPs at the nightclub."

Without discounts from Apple, iPod promotions can be costly for some businesses. Hard Drive spent about $16,000 for 150 iPod Shuffles--a large sum, Golden acknowledged, just for VIP passes. But he added that the move had already paid off. "Clubs spend a lot of money yearly on marketing alone," he said, but "not many clubs give out $100 items as VIP tokens."

PepsiCo was one of the first big companies to tap into the iPod-promotional craze, first last February with a sweepstakes--introduced in Super Bowl commercials--offering codes for free song downloads (ordinarily 99 cents) from Apple's iTunes music library. The codes were available in Pepsi and Sierra Mist bottle caps.

"We were like, "We should jump on this because it's going to be big,'" said James Miller, a marketing director at Pepsi-Cola North America. Pepsi extended the iTunes promotion this year to include its Mountain Dew brand and overlapped the promotion with a 10-week iPod Mini giveaway.

Such promotions will no doubt continue--that is, at least as long as the iPod remains trendy. The challenge, Miller says, is for marketers to find fresh ways to extend the iPod brand to their own products.

"Our first promotion was all about the song downloads," he said. "The second one was downloads and iPod Minis, which begs the question: What's next?"