Premiums are generally believed to be something additional that a company will either give away or charge a set amount for. For instance, quite a few computer software developers are now packaging a free mouse pad with their software. If you buy their software, they will throw in the mouse pad for free. Of course, the mouse pad is imprinted with their company logo or name of their software. This works well for the consumer because he is receiving something in addition (at no cost) to what he originally wanted. It also works well for the software company because of the possibility of added exposure of their company or software name (on the mouse pad). In fact, many of these companies are actually imprinting tips about the software or tech support hot lines on the mouse pads. Cereal companies are believed to be the first to have used premiums successfully. Incentives are used to motivate employees or salespeople to serve better or sell more. A commonly used incentive program involves a sales staff selling life insurance, for instance. The manager would set guidelines as well as time frame in which the salesperson with the most policies sold or most customers contacted would win a prize. This prize could be a trip to the Bahamas or a big screen television. Incentives are usually intended to motivate those involved. And, if designed properly, work very well.