How To Create Profitable Consumer Contests
Part 2 of 2
In part 1 of this tutorial, we identified the five benefits of online consumer contests and we outlined the characteristics of sweepstakes and instant win contests.
In part 2, we will explain how to take consumer contests to the next level and generate more revenue from existing customers.
Adding Customer Intelligence
Consumer contests shouldn’t just be used to acquire e-mails. This tactful consumer marketing strategy should also be used to gather actionable customer intelligence.
Doing so enables you to increase customer loyalty considerably by combining consumer research and targeted customer marketing.
This consumer research can then be used to segment your e-mail database. Once you have your different segments, you can begin sending them targeted e-mail content. Now, watch as your conversion-to-purchase rate increases.
The key is to easily allow consumers to enter your contests, while providing an additional incentive to provide you with some valuable customer insight. If you don’t make the data collection an optional step, contest participation rates and e-mail acquisition rates will drop below industry average.
BehaviorWorx recommends that you centralize all consumer contests on the same platform used to capture customer insight. For example, most of our marketing research data is collected (for our clients) using web-based surveys. Linking a consumer contest to the front end of this process serves two purposes: (1) we increase survey response rates and (2) we capture priceless customer research and intelligence.
Most companies only have limited knowledge about their e-mail databases, such as name, e-mail and mailing address. This consumer marketing strategy can only serve useful if targeted e-mail marketing takes place. Here are some essentials that every company should know about their e-mail database:
Primary Store - Consumer research at its very basic level will enable retailers to identify their customers’ primary store (e.g. where they do most of their shopping). This would allow them to send store-specific e-mail notifications.
Gender - Needless to say, this is particularly important if some products cater to males and others to females.
Age - A customer’s age determines the language and style of each communication. Also, retailers may offer different products to different age groups (e.g. seniors vs. teenagers).
Desired Content - For a consumer marketing strategy to be effective, you must take consumer research into consideration. What is the best way to increase e-mail open rates and to decrease unsubscribe rates? Send them content that they actually want to receive.
Collecting the above pieces of consumer research data would greatly increase the effectiveness of e-mail campaigns. Want to step it up to the next level? Add the following information to your database:
Likelihood to shop your online store - If a customer would prefer to shop in-store, the call to action is going to be different. Asking them to shop online is essentially a waste of time and money.
Wallet share - It's important to know customer loyalty. How much of each customer’s wallet is shared with you versus your competitors? The same incentive wouldn’t necessarily be offered to loyal and non-loyal customers.
Monthly budget - Classifying customers as “high budget” and “low budget” allows premium shoppers and value shoppers to be identified.
Purpose of shopping trip - What are the different reasons that customers have for visiting your stores? Do they buy products for themselves or their children?
Preferred product categories - What do customers primarily buy from you? If there is a product category that they only buy from your competitors, focusing an entire campaign around brand switching can be considered.
Competitive insight - Customers can tell you where else they shop, what they buy there and why they don’t buy it from you. Use this consumer research to your advantage.
It takes organizational commitment to build a comprehensive customer e-mail database and to develop targeted e-mail campaigns. However, the financial pay-offs are huge. To read more about targeted e-mail campaigns, check out our two part tutorial “Target Your Email Marketing - For Free”.
Making Your Contest Viral
Most retailers today already have a Facebook page. Many also have Twitter followers. With these tools, it isn’t difficult to extend the reach of your consumer contests. Add a link from your website and a tell-a-friend feature and your contest has officially gone viral.
With a viral consumer marketing strategy, you’ll not only reach more customers, but you’ll reach “non-customers” as well. Capturing consumer research from your non-customers provides fascinating insights. Wouldn’t it be beneficial to know why they buy from your competitors but not from you? Imagine capturing thousands of non-customer e-mail addresses and sending them targeted offers that convert them to your brand. This consumer marketing strategy is just one of many ways BehaviorWorx can help you generate more revenue.
In Closing
Please contact us if you would like to discuss this tutorial or any other aspect of marketing and customer strategy.
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