Over the last three years I have witnessed first hand the reduction in value of the “major prize giveaway” from a consumer’s perspective. Through research and observation there are two main reasons for this:
1. Perceived value of the effort vs. the inevitable outcome:
As consumers we no longer see any value in taking the time to complete an entry form and waiting approximately six weeks for a draw to take place, only to find that the $30,000 car was won by one of the other 203,479 people who completed the entry form. From a marketers point of view the data collected is fabulous but unless the objective was to specifically collect a database this type of promotion may not generate a spike in sales.
2. Lack of budget and resource to effectively activate:
Developing and implementing a major prize giveaway is no mean feat and even when working with large international companies the budget is often sucked up in the process of developing the concept, sourcing the prize and creating the materials. Woops, there is no money left for actually advertising the giveaway! Sure, this is ok if the objective is to retain existing customers who frequent the location of your business, but it’s a huge problem if the objective was to gain the attention of new customers, which needs the support of external advertising resources such as print, digital, and PR.
Current trends suggest that consumers respond to “instant gratification” and “value add” more than anything else. By connecting with your customer at the potential point of sale you can get your message to cut through, and more importantly improve your chances for the desired call to action.
A wonderful example of this is the cross promotion between Taronga Zoo and Woolworths with their Aussie Animal Cards. Who would have thought that a $5 display book and animal collector cards would create such a frenzy. I don’t know a parent of preschool & primary school aged children who didn’t spend extra money during the promotional period to help their children collect the whole set and earn a free Taronga Zoo entry, my self included! And that was just the start….
By creating something that was instantly accessible to every customer Woolworths were able to generate the holy grail of marketing: word of mouth, increased sales, priceless brand awareness and customer engagement.Now, we don’t all have budgets like Woolworths but we can learn from and apply instant gratification and value add to help with our promotional goals.
A quick example to consider using a fictional small business:Lisa has just started a local outdoors Pilates class where she is trying to compete with a number of more established local providers. Rather than your usual price reduction (cutting precious margin) or ‘visit our class and receive an entry into our end of year prize give away’, Lisa could try some of the following promotional ideas to play on the instant gratification and value add models:
- Book your first Pilates class and receive a free Pilates mat! Choose your favourite colour from hot pink or turquoise blue!
- Come and enjoy a class at Lisa’s Outdoor Pilates. Book a ten class pass and receive a Pilates Pack including a Pilates Mat, Filtered Drink Bottle, Sunscreen and some fabulous sample goodies from local beauty and health food retailers.
Yes, some budget is needed to implement these strategies but they avoid discounting and provide the opportunity to create branded give-aways that get your customers taking your brand with them. Never second-guess the importance of developing relationships with local businesses that have synergies and vertical alliances with yours. By adding the sample goodies, Lisa is getting some no cost give-aways to include in her offer and generating relationships with fellow businesses at the same time. WIN WIN!
Ready to chat about promotions, instant gratification and value add? Contact Team Bungalow.