Beat the incoming HFSS ban with prize promotions.

With delays brought on by Covid and the ensuing financial downturn, the Labour government has decided to finally bring proposed advertising bans on unhealthy products in to play this October (2025).

This is going to create a huge vacuum for brands who have become reliant on price discounting to drive ROS. But fear not, on or off pack Prize promotions can fill in the gaps.

When done well, they not only have a short-term sales effect but can have long-term benefits too, including:

– Showcasing a brand’s proposition

– Providing a way to stand out from competition

– Aiding the negotiation of incremental in-store display at retail

– Encouraging trial

– Driving sales

– Rewarding loyalty

– Collecting much needed first party data post the updated privacy restrictions on third-party cookies

Indeed, research has shown that 33% of prize promotion participants are open to receiving information about a brand.  And contests have an extremely high conversion rate, 34%, which is significant when compared to other sources such as PPC. And it doesn’t need to be expensive to run them either.

We recently conducted a study that surveyed respondents who had been persuaded to buy products based on promotions where they can win or get something. The aim of the research was to reveal the psychological tipping points of prize promotions and we uncovered some surprising insights.

Here are just two:

– Consumers react as favourably to smaller value prizes as they do to larger cash-value prizes

– Consumers react as favourably to low numbers of prizes being offered as they do vast numbers of prizes

However, brands do need think about being good citizens.

Make your promotion believable.

Shoppers are smart and will question the validity of a small brand offering to give away a million pounds. For consumers to trust in what’s up for grabs, brands should look at publicly announcing the winners at the end of a campaign to ensure people know it’s legit.

Trust and transparency are key.

It may seem obvious, but so many brands fail to be transparent about the terms and conditions of entering a competition, or sometimes even fail to effectively communicate the entry method. This inevitably leads to confused customers, complaints on social media and, albeit rare, legal battles.

Ensure optimal security.

Obviously printing unique reference numbers onto packaging is expensive so it isn’t the first choice approach – yet by avoiding doing this, it’s much easier for bots (and persistent humans!) to play the system. But there are now ways do work around this and they cost little to implement.

Ensure your shopper marketing spend matches the promotion.

Another slip-up brands can often make is not supporting the promotion with a big enough media budget, which is necessary if you are a brand with limited facings and a less than preferable position on shelf. A good rule of thumb is to check if the supporting media budget outweighs the cost of the promotion by at least 3 to 1. If it does, then ROI will be maximised.

If you are considering running a prize promotion, or if this article has subsequently persuaded you to look in to doing so, please do get in touch.  Our shopper team have run 100s of them in the past and would be delighted to chat you through their point of view and findings in a 30-minute chat.

Please email james.willoughby@senselondon.com to find out more.