Brands should get bold with their promotions to beat the big squeeze
Price is not everything. Prize promotions have never been more in demand from consumers and can deliver significant uplifts in sales and loyalty, says research from PromoVeritas.
Prize promotions should be high on the agenda for today’s marketers
Prize promotions are a tried and tested, highly measurable, form of marketing investment and they deserve to be an expanded part of the marketing mix for most brands. This is especially true with the current economic climate, being financially squeezed with rampant food price inflation and soaring energy bills. Everyone likes a win.
To highlight the power of promotions, promotional marketing compliance specialists PromoVeritas partnered with The Drum earlier in 2022 to launch the 'Most Effective Prize Promotion' category at The Drum Awards for Marketing 2022. The winner was Chilean non-profit organization Techno Latam, for a promotion that raised awareness and funds for poverty-stricken townships in Latin America. The runner-up was an offbeat Heinz promotion giving away 500 tins of Christmas Dinner Variety Big Soup.
Jeremy Stern, the chief executive of PromoVeritas, argues that it’s time for a reassessment of promotional activity, and to let some classic but bold idea take center stage.
Prize promotions should be high on the agenda for today’s marketers, who need to be brave enough to look beyond the allure of running yet another influencer post on TikTok or other social channels. Regardless of their industry category, well-constructed and delivered prize promotions will achieve strong results in the real world – where most people exist.
Prize promotions are highly measurable
The key point is that prize promotions are highly measurable and effective for brands but that marketers aren’t making the most of this opportunity. Stern says: “Every marketing director out there wipes their bum with toilet paper. Every marketing director buys a packet of crisps, chews on a Mars bar, eats cereal and loves a freebie. In other words, they are normal people, but what I find amazing, is that they do not bring what influences them into the planning of their own brands, they don’t carry forward the things that engage or nudge them, down the chain to consumers.”
Recent research of 2,000 UK consumers, conducted by PromoVeritas, supports Stern’s argument by highlighting how shoppers continue to value prize promotions due to the high entertainment factor and engagement that they provide.
The results show that Willy Wonka Golden Ticket style instant wins are identified by 34% of people as their favorite promotional mechanic, closely followed by 29% who really like prize draws, and then competitions (i.e. games of skill) (26%) and interactive games (16%).
PromoVeritas brings this knowledge of the optimum techniques to life in its own work for its many brand clients – for example a recent campaign for Cadbury Dairy Milk was called ‘Inventor’ and invited fans to create their very own dream bar from a huge list of ingredients.
On top of a new taste, budding inventors were asked to propose a name and explain what inspired their unique chocolate creation. Over 200,000 entries were judged, and the best three combinations were then made and sold across stores in the UK, to determine, based on those sales, the overall winner (which was Shannon Beech’s Honeycomb & Nuts).
A direct impact on sales
The research from PromoVeritas shows clearly that promotions have an even larger role to play for brands as cost pressures increase. Almost half (44%) say that they’d be more likely to enter prize promotions to win lower value products (such as groceries, or money off in supermarkets or on energy bills).
Weaving this promotional focus into the marketing mix can have a strong benefit for brand owners. Promotions have a direct effect on sales: 33% of consumers (and 48% for those 18-24) say that they prize promotions encourage them to buy a new product, and 25% that they are encouraged to stay with a brand getting more expensive due to rising inflation.
The positive outcomes go beyond just immediate sales and extend to increases in loyalty. Close to a third (31%) of shoppers say that regular prize draws encourage them to remain with loyalty programs, and 30% to sign up to a loyalty program if there is a chance of a prize.
And in another sign of the change in shopper behavior in current times, we have seen the people’s choice of favorite prizes change. It used to be cars and holidays, but now the ideal prize is either cash or gift vouchers, ideally as close to cash as possible. Tech gadgets are in third place with holidays behind.
Another key aspect that consumers worry about is the integrity of the promotion. Is it run fairly? Is there a decent chance of winning? Are there really 10 prizes to be won? And is it going to be fixed? Adding security and integrity to prize promotions is key to PromoVeritas. Its unique angle is to “run it right” – blending legal, digital and operations expertise to run thousands of promotions in the UK, in Europe and beyond. This means that brands – and their agencies – are able to stay onside with both shoppers and regulators while still achieving excellent results.
PromoVeritas can assist brands in tight situations: from finding ways to link to global events such the World Cup as non-sponsors, to finding marketing options for brands that will be adversely impacted by the forthcoming HFSS legislation. For example, “if you are a brand affected by HFSS,” says Stern, “and that is most popular brands, then you will be banned from TV and radio, but running an on-pack prize draw, competition or instant win is one of the few marketing mechanics that you’re still allowed to do.”
An additional benefit, is that type of activity allows you to build up a database of keen consumers, and even under the tight HFSS rules, brands are allowed to target their own customers through email without constraint.
For those prepared to be brave, this needn’t be a nervous time for marketers. You just need to bold and creative and whilst everyone else is chasing social media views, struggling with sensitive influencers and gaining tiny increases in awareness on TV, you could be running highly effective, volume engaging promotional work, and come out of this big squeeze with the best results.
For more advice on how to ‘run it right’ and get the most out of your promotional activities, visit here: https://www.promoveritas.com/.
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PromoVeritas Ltd was founded in 2002 by our CEO Jeremy Stern, a former senior marketer for Coca Cola and Kraft, who wanted to bridge the gap between big law firms, in-house legal departments and their creative agencies. He had seen first-hand the problems of non-compliance and bad practice in the running of prize promotions and set up PromoVeritas to take the effort and administration out of promotional compliance, thus enhancing the security and integrity of the campaign and protecting the brand’s reputation.Find out more