Flatlining

Wearied by staff reductions and budget cuts, marketers were a little less willing to take risks last year and under increased pressure to produce. They were also highly sensitive to a consumer made nervous by the war in Iraq and the dreary job picture, The result? Spending on games, contests and sweepstakes remained flat in 2003 at about $1.8 billion. The good news? Spending on this tactic for 2004 looks to be on the upswing, with some agencies reporting a significant uptick in requests for proposals.

Overall, technology was the name of the game, highlighted by clever gizmos like Wonka’s screaming candy packages that thrilled the 200 who opened the instant-win packs. The promotion drove a 57% increase in sales, or $6 million in incremental revenue, and was tied to screaming contests staged at roller coaster venues. (It took the first place 2003 PRO Award for Best Multidiscipline Campaign.) Wonka is the lesser-known division of candy manufacturer Nestlé.

Another highlight: Premiere Magazine hosted an Oscar-themed text-message sweeps this past February, a first for the movie monthly. Cell phone users texted in to predict Academy Award winners, paying $2 for a ballot and movie alerts on their phones. Those who correctly predicted all winners in 12 categories were entered into a random drawing whereby the winner received a trip to Hollywood.

“[Interactive games are] going to get even bigger as more and more consumers get access to text messaging and figure out how fun it can be,” says Marnie Baker, VP-Asterisk*, Chicago.

Messaging applications are expected to generate $2 billion in revenues by 2005, compared to $531 million in 2002, according to a report by Morgan Stanley. And the number of U.S. wireless subscribers has grown 9.7% year over year, to 144.2 million in 2003.

The Internet became an increasingly big player in games, sweeps and contests, valued for its interactivity and data capture capabilities as well as the inexpensive costs to get promotions up and running.

7-Up carried 12-digit Liquid Loot codes, for example, that translated to bidding currency at its specially designed Web site. Consumers could bank points on site to bid on prizes that was refreshed every three months.

Clorox engaged its customers with a game for its Tilex bathroom tub and tile cleaner, called Flower Power. Participants blasted a squirt of the product on an on-pack floral-scented game piece that revealed whether the consumer had won.

“Programs are more experiential, there is more involvement with the audience,” says Robert Borman, president of Borman, LLC, Minneapolis. “It’s more than just filling out an entry form.”

Spending for on-pack games in the quick-service restaurant category continued to feel the impact of the 2001 McScandal. After promo shop Simon Marketing’s security director — whose embezzlement ring stole $20 million worth of McDonald’s Monopoly game pieces — testified that he had recruited his friends to find people to redeem the stolen pieces, the damage was done.

“There is lots of skepticism on consumers minds and companies running these games are concerned about consumer backlash,” Baker says.

Even so, McDonald’s wrapped up Winning Time last spring, its first game promotion since the scandal. The game played well with consumers, with 400-million pieces distributed and store traffic up during the promotion. In October it restarted a Monopoly game with electronics retailer Best Buy, but had to end the promotion early after running out of game pieces.

As for the prizes, grandiose top awards that generate lots of buzz — think Pepsi’s Play for a Billion — remain hot, but there is also a renewed interest in building pyramid prize structures for smaller budgets, where more people have a chance to win.

“It’s tough to make a lot of noise if you’ve only got $25,000,” says Bruce Hollander, senior VP, Don Jagoda Associates, Melville, NY. “But you can still have an exciting prize structure by increasing the number of prizes and the odds of winning.

SNAPSHOT 2003

• Total spending: $1.8 billion (flat over 2002)
• Technology, especially interactive, drives participation
• Bigger-ticket prizes generate buzz