3 Common Mistakes Marketing People Are Making With Their Giveaway Promotions, And How To Avoid Them With A New, Unique Giving Structure
In this post I am sharing a unique way to run a giveaway contest, that will help you grow your list of email subscribers/leads and maximize your ability to reach new people by turning your existing audience into your best advertising.
- You will see actual results from a campaign we are running
- We will compare traditional giveaways with a new and unique format that inspires more sharing and a chance at going “viral”
- And I will share several lessons we learned along the way (including a couple mistakes to avoid)
[Please note — this post was originally written halfway thru the giveaway contest, with one week to go until the drawing. See the update note at the end, plus final statistics, and a summary of what was learned.]
My friend Jeff has a pretty cool project going, a weekly newsletter called the Sports Chowdah! for Maine fans of the New England sports teams. If you don’t get the “chowdah” reference in the name, you probably aren’t from New England.
In building up his newsletter business, Jeff has done a great job of amassing a dozen different content contributors who post their perspectives on what’s happening with our beloved Red Sox, Celtics, Patriots, Bruins, University of Maine Black Bears, and other big sports news in the region.
He also has done an impressive job of building relationships with a number of local businesses who sponsor and help support the newsletter. Considering that the Sports Chowdah! didn’t even exist a year ago at this time, it has been an interesting story to follow.
Here’s The Challenge
But one of the challenges Jeff and his team wrestle with — a problem that we all face is — how do you reach new people so they will know about the cool things you are doing, offering, and selling?
Being a creative guy with a background in marketing, Jeff has done a number of different promotional campaigns, including signing up subscribers at tailgating events (a great fit for his core audience). But the thing that has produced more readers than anything else — has been running random drawings for prize giveaways each month.
Because I am one of Jeff’s subscribers (a sports fan, born and raised on New England’s history of championship teams) I follow the newsletter and have entered several of his giveaways. Like many publishers, Jeff always includes language in each promotion inviting people to enter the giveaway AND asking them to share with their friends.
But traditionally, this approach doesn’t work so well…
I would be nice to think that human beings are always thinking of others — but the facts of the matter are that if you are going to take the time to make a referral to friends (the number one driver of business for most business is word of mouth marketing) there has to be something in it — for you as the sharer and it has to be worthwhile for the friend you are sharing it with. Otherwise, people are just too busy and don’t bother to share.
If you want to win a great prize, what is the incentive to tell a lot of other people if it lowers your chances of winning?
Giveaways Are A Great Way To Engage New People
I want to take a moment to point out something really key in this breakdown. In running his giveaways, Jeff is tapping into something really powerful — something I like to call “Givers/Get” — which is just a short, memorable way of reminding myself that when people give first, and give regularly, it is the best way to build a deep, and meaningful relationship with people.
That is how you end up “getting” what you want, whether that means building a growing list of subscribers who join your circle of influence, or even selling a product or service.
So with Givers/Get in mind, I reached out to Jeff, and suggested that for his next giveaway I could help him structure it as both a giveaway and a contest — which would make it a fun game for his people to play (they are sports fans after all) and also increase his reach to new subscribers. But not just any subscribers.
My plan was to make it compelling for his current people to reach out to other like-minded folks because as we all know, birds of a feather tend to flock together. I wanted to make it so each die-hard Boston sports fan would share around the water cooler, in between chatting about Kyrie Irving’s arrival in Boston.
So this is what we did:
Using software to track the entries (and this is a really key point, as you will see in the “lessons learned” section below), we set up a giveaway contest with a unique 3 prize format — each one a $100 Visa Gift Card.
I should take a moment to explain, that a giveaway (also called a sweepstakes) is defined as taking a stated prize and selecting the winner by random drawing. It is also important to note that there is no cost to enter a giveaway or sweepstakes.
If a person does have to buy or pay to enter, you step over into the legal land of lotteries — which is much more complex legally. Make sure you consult a legal advisor first.
So Jeff was already familiar with running random drawing for his giveaways, but the second part — the “contest” aspect was new. That is where we assigned 1 point or chance for each person who entered the random drawing, but we also gave 5 extra points or chances to win for each friend who signed up using a special referral link (the tracking mechanism to see who received credit for the referral).
But if we stopped there — just giving extra chances to people for signing up their friends — the contest probably would only inspire a limited amount of activity. We all have friends who are willing to spam their social profiles with links to sign up for this or that — and they do it because they are getting something out of it. But while it serves them, they are burning “social currency” with their friends because they come off as a user.
Our giveaway contest for the Sports Chowdah! was going to be different. Yes, people entering the contest are also going to get a free copy of the email newsletter — a value by itself — the new subscribers would not yet be familiar with why they should care. So we had to come up with something more.
To make it more compelling to share — we decided to give 5 additional points or chances to the friend who entered the contest via a referral link. So now, you could not only improve your own chances of winning by sharing, but you could help your friends win by increasing their chances too. They would get 5 chances to win by signing up with you, versus the 1 chance to win they would have got if they just saw the contest and entered on their own.
But we didn’t stop there…
Because we decided to use this unique, 3 prize format it created a real game out of entering the contest. There would be 3 winners, and each winner selected a different way. This video, which was shown on the confirmation page after a person entered the contest, shows how these additional chances to win would work:
See what we are doing here? Three ways to win. Three different winners. If you help your friend win, you win too. So it makes it fun to play together.
So Here’s What We Learned So Far…
At the time of writing this article, the giveaway contest is slated to run for 2 weeks and we are less than a week into the promotion, and it has been really fun to watch the results.
To kick off the announcement of the giveaway contest, Jeff shared a link in last week’s Sports Chowdah! so his current subscribers would have a chance to enter. This is what I call, “seeding the giveaway contest” because in order to get the viral sharing to kick in, you have to have an initial batch of people enter, see the opportunity and start sharing.
It is also interesting to note that in last week’s newsletter, Jeff was also promoting a different giveaway which was close to ending so that other giveaway received prime real estate at the top of the newsletter.
The $100 Visa Gift Card Giveaway Contest was also promoted in the same newsletter, but near the bottom of so any readers who did not read all the way to the bottom of the newsletter might have missed the announcement.
Special note here — pay attention to what Jeff is doing for his readers. By running repeated giveaways, he is creating a compelling reason for his subscribers to stay engaged. So any subscriber is going to think twice before unsubscribing (too much email is the number one complaint from people who unsubscribe) because when the newsletters stop — you also stop the announcement about who won, and what the next giveaway will be.
In addition to telling his current audience via the newsletter and social media channels about the promotion, Jeff also boosted that post with $70 of Facebook advertising to help get the giveaway contest in front of more people to get the ball rolling.
The total reach of his existing audience and Facebook advertising can be seen in this chart, labeled as “direct visitors or traffic that came to the giveaway contest landing page directly and not referred by someone who had entered the contest.
This number (currently 179 visitors and 67 leads) is what you would get from running a giveaway the traditional way, without using software to enhance and track the social sharing. This is how most people do it.
The numbers to the right (1014 visitors and 317 leads) is the impact of the viral sharing that was produced by people who felt inspired to share and help their friends win (also increasing their own chances of winning).
For me, the metric that I watch most closely and is the most meaningful indicator of whether we are hitting viral status is show on the far right in purple as the compound conversion rate.
Here’s where we have to get a bit nerdy with the math for a moment. A compound conversion rate is calculated as the counts of directs visitors compared to the counts of total leads.
Direct visits are those who have not been referred and total leads are those who opted in as email subscribers.
Example (from UpViral.com):
Campaign # 1 = 91 total leads / 207 direct visitors = 44% Compound Conversion Rate.
As shown in this example, it is a percentage and you want to see at least 100% or more to indicate you reached viral status.
The other way I have seen people track whether a campaign goes “viral” is with what they call a viral coefficient. Basically that means that for ever person (on average) who enters a contest (or watches a “viral” video would be another example) their participation produces at least one other person to do the same. Sometimes just the number of people watching a video will make it go “viral” because the trending status of the video makes it more visible and more likely to be shared.
All nerdy stuff aside — what you see is that currently (we still have over a week to go in the giveaway contest) our compound conversion rate is over 200% which means that for each person entering the contest as a direct visitor (traditional methods of promotion), at least two new people are also going to jump into the contest because of the viral sharing.
That is pretty damn cool! That is what marketers want to see with all of their promotions, because it means your audience is doing your advertising for you. And the cost of advertising was putting together an awesome collection of prizes, combined with the right sharing engine.
More Lessons Learned (the hard way)
But we did run into some unexpected issues, that were valuable lessons for us and something you can learn from too.
First, I will tell you that this giveaway contest is not the first one I’ve run. Prior to this contest, I launched several “stinkers” that just didn’t reduce good results. They never reached viral status, and the prizes cost more than the value of advertising + leads as a net impact.
What I learned from these “failed” efforts is that picking the right prize (what they call prize/audience matching) is one of the THE critical elements to running a successful giveaway contest. Having the right structure to inspire sharing being the “other” critical element.
Some of my earlier efforts also failed because I made rookie mistakes. My landing pages focused too much on WHY I was running the giveaway, or did NOT make the value of the prize for the winner amazingly clear — so I got well below the 30% visitor to entry conversion rates you see in the screenshots above.
Business people please take note — the average website selling a product or service would LOVE to have a 2% conversion rate. That means that 98% of the people walk away and you get nothing from them. But as you see in these numbers — 30–40% of the traffic is engaging with us (because they want to win the prizes). In exchange for those prizes, we have permission to follow up with them.
There is no better way to build a deep, meaningful relationship with people that to produce a weekly newsletter with valuable content the way Jeff is doing (that is my core business too — producing newsletters for clients — see below for an example).
Do you want to be the kind of guy who goes for the kiss on the first date, or do you want to build some know, like, and trust first? Yes, the kissing is sexy… but look at all the smarmy people on the internet these days. Your audience doesn’t know if you are one of them — or one of the good guys, until you prove it first. Givers/Get. Remember that.
Back to the problems we ran into:
When Jeff and I were planning the giveaway contest, he already had one $100 Visa Gift Card available to use for an upcoming giveaway. I explained how we were going to need 3 prizes, so he added 2 more.
But gift cards are (especially a Visa gift card which you can use anywhere) a generically valuable prize that ANYONE would want. The BEST prizes you can offer are ones that are infinitely valuable to your target audience, but actually REPEL the people you don’t want on your list because they do not match your audience profile.
I learned this lesson (the hard way) from my friends and brilliant giveaway marketers Chris and Mitch who coached me thru the process of audience/prize matching. Think about what would be a prize compelling enough that it would make you want to enter a contest?
A lot of people will give away an iPad or some cool trendy device. But anyone would be happy to win one of those. Chris ran a really cool giveaway contest for professional grade art supplies (he is a classically trained artist who teaches his skillset to amateurs) and generated thousands of entries. The biggest prizes are not always the best. It is the best matched prizes that will attract the people you want on your list, that will produce the best results in the long run.
A small, responsive list is way more valuable than a big, non-responsive list. Make sense?
By offering the $100 Visa Gift Cards, we potentially run the risk of attracting people who want to win the prizes, but are not a good match to the Sports Chowdah! audience — meaning, they won’t stick around as subscribers.
I am working with Jeff to address this potential issue, by sending a welcome email that let’s people know that in addition to the chance to win, it outlines all the value they will get from the free email newsletter each week, and the reasons they may want to stick around for more exciting giveaways.
The contest entrants who respond to this kind of welcome message will be a great fit for the subscriber list. The ones who don’t, you probably wouldn’t want on your list anyways because they are just in it for the prizes.
We also ran into one (not totally unexpected) issue — but a new one for me.
One contest entrant tried to game the system. Because we were offering extra chances for each referral, we had one person who entered over 40 questionable email addresses, pumping up their own chances to win and garnering extra chances for each of the “fake” or extra email addresses.
On the surface — this looks like a pretty easy way of gaming a giveaway contest, right?
But the software we use (UpViral.com — no affiliate link) has fraud detection built in to the contest monitoring and detects suspicious activity. So I was able to quickly identify the offender and disable their entries. And of course, the giveaway contest terms and conditions were already written to outlaw this kind of cheating or manipulation.
So what did I learn and what would I do differently?
It has been kind of exciting to watch the giveaway contest hit viral status and start to add dozens of new entries each day. And we still have over a week to go until the drawing.
This is what is most fun about being a digital marketer. When you get it right, it feels like playing a video game and you get to watch the “scores” start to rack up — but the experience points you are accumulating have an impact in real life too.
Jeff and the Sports Chowdah! are going to have hundreds of new readers digesting their content each week. His sponsors are going to be happier because they too want to get their name and branding out to reach more people. But don’t take my word for it…
“Earlier this year I started my free sports email newsletter and tried several different methods to grow readership.
One of the most successful is to offer a prize as an incentive to take action and sign up.
So, I do frequent giveaways with our newsletter. I have found no matter how good the product, people need to be incentivized in some fashion to take the step to sign up.
The past week has been quite amazing! I haven’t seen anything that has grown our list so quickly and reached so many new subscribers in such a short time — because of the viral sharing.
I was skeptical but I am now a believer. I’m anxious to see what week two brings.” ~ Jeff Solari of Rock Lobster Media
One thing I learned and I will definitely focus on more in the future, is the prize/audience matching, because while everyone wants the“big viral” contest results, in the long run what you want most is to reach the people who will be the best fit and most likely to buy your product and service.
Anything less and you end up cheating yourself. Getting that perfect prize/audience fit takes some practice. It also is kind of like playing a video game. You have to earn a bunch of XP (experience points) before you can “level up” and go after the biggest rewards.
[Updated — Post Contest Notes]
As explained above, this post was originally written as the Giveaway Contest was underway and the results were still rolling. The end result were even better and confirmed several of the lessons learned above.
Here are the final totals:
For those keeping score at home, $300 was spent on the three $100 Visa Gift Cards, and $70 was used for a boosted Facebook post that helped “seed” the contest with initial entrants who were then challenged to share with friends to increase their chances of winning.
Those totals work out to just over $.36 per lead — which would be a flat out win in almost every business category.
Summary of What We Learned?
First, we created a bit of an issue for ourselves in that the prize (the “as good as cash” gift cards) was appealing to a wide swath of people and not specific to the target audience who would be great subscribers to the Maine Sports Chowdah!
You might remember that we received a batch of suspicious entrants from one player… those entries were deleted from the system because the software did prove they were fraudulent entries all made from the same IP Address.
The winner of the “Total Points” category (the third prize awarded) ended up with 295 referrals out of the 1040 total entries — so one person was responsible for more than 28% of all entries.
That looked kind of suspicious, but a little research into that profile revealed that she did something pretty smart for her (though probably not great for Jeff’s subscriber base) because she went looking for referrals in a place where people are used to entering giveaway contests.
Several of her referrals used words like “sweeps” in their email addresses, which suggests that they are “professional” players looking to win sweepstakes and giveaways, and not the New England sports fans that we were targeting.
This was Lesson #1 — we found a prize that people wanted to win, but it is equally important that you select a prize that will repel the vast majority, otherwise you end up watering down your list of leads/subscribers.
Is it possible that some of these professional sweepstakes players are also fans of the Celtics, Red Sox, Patriots, and Bruins? Possible. Not likely. The proof will be in how long they stay subscribed and how engaged they stay with each new weekly newsletter.
In what is called “good list hygiene” it is better to have a smaller, more engaged list of email subscribers than to have a big list where people don’t pay attention (measured by opens and clicks) because the non-engaged subscribers will actually lower the average engagement, which could effect the chances of getting in the inbox for the people who really do want to hear from you.
So this is definitely something we will pay attention to closely on future Giveaway Contests.
The Second Lesson we learned, was the confirmation that the “three, same prize” format was a success and appeared to really raise the overall level of sharing. While the point totals were dominated by a couple professionals who entered the contest near the end, that majority of all players received multiple chances to win — which means they either came in via a referral or they were referring friends themselves.
In fact, the winner of the random draw went to a player with 7 chances to win, compared to the dominant points leader with over 1400 chances in the drawing.
As I explained earlier in the article, the compound conversion rate is a measure of how many entrants were acquired via sharing compared to how many entered as direct visitors (see the math formula above).
In the final numbers, you can see that for each person who entered the “traditional way” that most folks run giveaways — over 500% or an additional five people were added to the contest because of the viral sharing.
So we will definitely be employing the “three same prize” strategy in future contests to maximize the sharing.
And in the last of the Three Lessons Learned, I asked myself what would it have taken to 10x the results of this contest, so that instead of getting 1040 entrants we collected more than 10,000.
The answer is head-slappingly simple, though we didn’t really stop to make this change a week or so ago when the contest was still running.
Quality of the leads aside (meaning do better prize/audience matching) we could have “blown up” this giveaway contest just by repeating the initial charge of “seeded” entrants that came in as direct visitors.
Many businesses are used to using Facebook advertising to promote their events, products, and services. Paying $1 or more in not uncommon, and I have seen averages in the $1.70 per click (not per lead but per click) range.
Theoretically, if we 10x’d ($700 vs $70) the advertising budget, and continued to boost the promotion throughout the two weeks, the viral component would have carried the final results even further.
For example, if we 20x’d the advertising budget (to $1400) the direct traffic would have gone from 200 to 4,000, but the viral effect would have reached nearly 80,000, and produced somewhere between 10,000 and 20,000 entrants.
You can see in this screenshot, that the red portion of the graph on the left indicates the direct visitors, and the blue “peaks” show that the remainder of the campaign was nearly all driven by the viral sharing with no “pushing” the promotion the way most businesses do when they need to raise awareness for their offerings.
So in the future, we will definitely plan not only a launch strategy to “seed” and get things rolling, but once we see the viral effect kick in — that is a great time to maximize your advertising budget and get more bang for each buck.
Think of it like riding your bike. You might to get up the hill and then coast down the other side, but occasionally you also peddle on flat ground because it keeps your momentum going to get your where you are going, faster.
I hope some of this breakdown will be helpful to others who want to use giveaways to grow their business, their audience, and their lists. As you can see, I am still a newbie and learning when it comes to running the GC’s.
But it was so much fun to wake up each morning during the contest to check the results from the previous night (especially on the final night of the contest when we added over 300 entries in the last hours) that I am sure we will be running more soon — and with much better prize/audience matching ;-)
Would A Giveaway Contest Help You Build Your List And Reach New People?
If you would like to talk about running a giveaway contest like Jeff’s, to grow your list, reach new people, and do it in a fun and compelling way — you can reach out to me at tobin [at] tobin slaven [dot] com.