“Reader’s Digest,” often credited with the creation of the sweepstakes offer, plans to eliminate the use of the marketing tactic after moving away from such offers over the last four years.
The company plans to use non-sweepstakes direct mail, package inserts, telemarketing and the Web for its acquisition and renewal marketing programs, which produce all of the magazines’ subscriptions.
As part of its ongoing testing program, offline and online sweepstakes marketing tests will periodically be conducted, the company said.
The magazine also said this week that it would cut its rate base from 11 million to 10 million copies for the five years beginning in January 2004.
After converting most of its 40 million to 50 million annual acquisition offers to non-sweeps, the single biggest elimination came last year in renewals, once sold entirely through sweeps. By the end of 2002, less than 10% of the magazine’s acquisition and renewal mailings were expected to be sold through sweeps.
For years, Pleasantville, NY-based Reader’s Digest relied on sweeps offers, enjoying steady 10% response rates. But competition, fatigue and state lotteries began to nip at the high rates. And once state and federal inquiries in 1999 uncovered alleged deceptive practices in sweepstakes marketing at major stampsheet agents American Family Publishers and Publishers Clearing House, responses for all sweepstakes mailers began to collapse. For “Reader’s Digest,” the total impact meant a drop in response to less than 2%.
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