What are Windfall Profits?
Contests and sweepstakes promotions refer to a type of promotion in which stores use specific items as prizes to stimulate consumer interest in buying and actively participate in and look forward to winning prizes.
Contests and sweepstakes
Right!
- Chinese name
- Contests and sweepstakes
- Foreign name
- Competition and lottery promotion
- Function
- Shop through specific methods
- Location
- Winning promotion
- Contests and sweepstakes promotions refer to a type of promotion in which stores use specific items as prizes to stimulate consumer interest in buying and actively participate in and look forward to winning prizes.
- Contests and sweepstakes promotions have the following functions: [1]
- 1. Pre-set prizes [1]
- First, the prizes are set. The prizes are usually set in the shape of a pyramid, that is, a high-value grand prize, followed by several medium-priced prizes, and a large number of low-price small prizes and souvenirs. Generally, most consumers are deeply interested in using cash as a gift. In addition, as long as the prizes are novel and unique, they can attract consumers like cash prizes. [2]
- For many years, marketers usually have a habitual view that consumers usually participate in competitions and sweepstakes for prizes. Therefore, continually seeking attractive prizes has become a test of marketers' ability. Those products with high value usually become the object of choice for prizes. From giving gifts such as gold and silver jewelry, color TVs, cars, etc. to spiritual and psychological enjoyment and satisfaction, almost everything is used. The goal is to capture consumers and attract them to participate in promotional activities. However, if consumer psychology is not understood, the choice of prizes may be subjective for marketers. For example, in some stores, there is a lottery on the spot. The prize is a small emerald. No matter how precious the salesperson says this emerald, consumers find it useless and cannot use it as soon as possible value. However, if this emerald is replaced with a practical, beautiful and unique item, the effect will be much better. [3]
- 1. Advantages [2]
- Contests and sweepstakes promotions can expand, build or strengthen the image of a product. For example, when marketers closely associate products with prominent gifts, they must be able to make the products more compelling, and they can also help shape or strengthen product positioning with the help of promotional themes.
- Promotions against competing brands. For example, when certain brands are using coupons for promotion, switching to contests or lottery methods will surely emerge and attract consumers attention.
- Although it may not always be effective to attract consumers, if the content or prizes are interesting, consumers will have a stronger desire to participate in trials.
- The difficult task of reaching the target customer to read the ad. Faced with the flood of advertisements, consumers can only break through the siege and stand out from the noisy advertising jungle by attracting consumers' interest and participation.
- Suitable for direct advertising and promotion appeals to specific target markets. For example, the theme of the competition or sweepstakes or the prizes given can be carefully planned to meet the real needs of a specific demographic structure or different psychological levels according to market regional strategies.
- Contests and sweepstakes can combine several brands or products to form a promotion. This method is most effective for marketers who have multiple brands or products in associated categories.
- 2. Disadvantages
- Contests and sweepstakes promotions do not necessarily result in a large number of trials or a sudden increase in sales performance. If this is the goal, then using another promotion technique-sample giving, will certainly be more effective. In short, the use of competitions and sweepstakes should be based on establishing a long-term product image rather than focusing on immediate immediate feedback.
- Consumer participation and product attention cannot be greatly expanded. In fact, only 20% of people will participate in such promotions, and about 75% to 90% of all participants in the raffle are not consumers who directly attach their actual shopping vouchers. Therefore, the participants of the contest and the lottery clearly did not purchase the product, and it is naturally difficult to achieve the sales goals set by the marketers.
- A large amount of media funding is usually needed for publicity to achieve results. However, from the perspective of opportunity cost, it is more helpful to increase sales by using the same funds for other direct-action promotions.