An online competition is a great way to generate sales for a product or service, that’s why they are so commonly used by large organisations like McDonalds and Coca-Cola. However they don’t have to be limited to large organisations, anyone can run an online competition.
Online competitions can achieve multiple marketing and sales goals at once for organisations. They can increase awareness, drive sales and generate leads for businesses.
However running an online competition isn’t as simple as it sounds. In order to run an effective online competition, there are best practises to achieve the best results and keep you out of trouble. This guide is designed to give you an insight into the work that goes into running a successful online competition.
If you’ve never seen an example of an online promotion, visit our test online promotion site, to checkout how it works. This demo microsite is purely for example purposes, and for demonstrating what is possible with an online promotion.
Decide a Prize/s
Arguably this is the most important decision when running an online competition. This affects all of the decisions you will make further down the track, so it’s important you decide your prize/s early and stick with it.
You want a prize that is going to resonate with your target audience. It doesn’t necessarily have to be an expensive prize, it could be multiple smaller prizes, so people feel like they have a better chance of winning.
You can also consider physical vs digital prizes, they both have pros and cons. Physical prizes can be more inspiring, but they can be harder to distribute. In-comparison digital prizes are easy to distribute, but less inspiring.
Potentially you could save money on prizes, by partnering with a business who can supply the prizes. This way, your partner receives “free” marketing, and you don’t have to pay for any prizes.
How will you capture the entries from your online competition? You’re going to need a website, to capture the entries.
To save money, you could go with an online platforms which allows you to create simple competitions on their platform. Unfortunately these online platforms are quite simple, which can result in your competition looking boring and dissuading people from joining.
Google “Online Competition Platforms” and have a look at the platforms available.
We recommend creating a custom microsite which can suit your competition needs. Custom microsites allow for complete customisation, including graphics, text and entry forms, which means your competition will perform better. These purpose built sites are also optimised for mobile and desktop devices, which is important because most people browse the internet through their mobile device.
A custom competition website can also allow you to integrate custom animations and interactive games into your competition. For example you could create a spin to win microsite, or shake to win, or scratch to win. At Adlab we are experts in building promotional microsites, to help online competitions achieve the best results.
Although this may seem like a small thing to consider in your competition, it can have a big effect on how many people enter your competition.
Consider this, how does a 0.5% chance of winning compare to 5% chance of winning. Which percentage is likely to encourage the most people to enter? Which competition would you feel more inclined to enter?
A higher win percentage is always going to encourage more people to enter your competition. So it’s a good practise to always try increase your win percentage. Increasing your win percentage can be done by limiting entries or having more prizes.
Game of Chance vs Game of Skill
On top of your entry mechanics, it’s also important to consider whether your competition will be a game of chance or game of skill. Depending on your choice, your legal requirements will change.
A game of chance is a competition where the winner is picked at random. Whilst in a game of skill, the winner is chosen based on their performance.
If you’re after the most entries into your competition, we recommend you go with a game of chance. This is because a game of skill requires more effort to enter the competition, which turns off people from entering. Whereas games of chance are simple to enter, which encourages a broader audience to enter.
Notifying your Audience
Once people have joined your competition, how are you going to notify them?
The most popular method of bounce back communication is email marketing, it can be automated and customised to provide a “congratulations for joining” email.
Other options for bounce back communication include SMS or by direct mail. Both of these methods are more expensive than email, but because they are less used, they can have greater impact because there is less competition.
We recommend using email, because it’s cheap, effective and allows for complete customisation.
Tracking Entries & Drawing Results
Most states and territories have strict regulations around trade promotions because they are considered gambling activities. Because of this, tracking results and drawing results needs to be taken seriously and conducted properly. We recommend looking at the trade promotions laws and regulations that are relevant to your state or territory, and following the regulations applicable to your online competition.
Most likely you will need to apply for a license, if your prize value is greater than a certain threshold. This often isn’t the fastest process, so make sure to give yourself a large amount of time to get it done.
Another common legislation is that when drawing the winners by using an electronic system, it must be a verified electronic system. So be sure to consider the cost of this electronic system.
Terms and Conditions
Having appropriate T&C’s for your competitions is the easiest way to prevent legal action and be compliant with laws and regulations.
Getting a professional organisation to write your T&C’s is the safest and fastest option available to you. There are multiple online organisations that offers extremely competitive pricing for T&C’s for trade promotions and competitions.
Investing in a professional legal advice to write terms & conditions can save your bacon in the case of unexpected situations. Terms & conditions can give provide solutions to complex issues like if the winner can’t be contacted to accept the prize.
Promoting the Competition
Like any marketing activity, promoting your competition will have the greatest effect on getting the best results. With your online competition, it’s best to have a range of strategies to promote the competition. Relying on only one method of promotion puts your competition of falling short of expectations.
We recommend using a diverse range of channels, including social media, email marketing, PPC advertising and physical advertising. Although this may seem like a lot of advertising in the short term, but in the long run you’re gaining valuable consumer data from the competition.
Consider this, you spend money on prizes, legal advice, a microsite, but you get no entries in your competition. This is why it’s important to invest in promoting your online competition.
Educate yourself on the laws in your state or territory about advertising a promotion. In our state of South Australia, there are strict requirements about the nature of the advertisements, and the information they contain.
One of the upsides of running an online competition, is that there is a great incentive for people to enter and share. This can lead to competitions gaining virality online and being shared by people.
This is the best form of marketing, because your competition gains credibility through people sharing and entering the competition.
Encouraging viral marketing in your competition can be done by encouraging people to share the competition via social media. Simply providing a button for people to share their entry on social media is a great way to provide this opportunity.
Whilst your competition is going on, you will want to monitor who is entering. This can help prevent people cheat the system, because you will be able to identify patterns of suspicious entrants. It can also help to monitor the success of your competition, if you see results are stagnating then it might be an indicator to invest more money in promoting the competition.
Once your online competition is completed, it’s your obligation to inform the winners and make sure they receive their prizes. You will need to reach out to them and arrange for the prizes to be distributed to them.
If you cannot contact or get a response from the winners, you will need to consult your terms & conditions about what the solution is. Some states legislate that you must give reasonable time for the winners to come forward and accept the prize. I’ll say it again, but invest in high quality terms & conditions.
In accordance with the regulations for your state or territories, there will be requirements about publishing the winners of your competition. This could involve either publishing the winners in a newspaper or on the competition website.
Competition Analytics and Analysing Success
Analysing the successes and failures of your competition is important for improving future competitions and identifying future opportunities.
Depending on the complexity of your online competition, you will have access to different analytics. When analysing success, first start with considering the number of entries you received, are you satisfied with the number of entries?
If you ran your competition on a custom website, you will likely have access to advance analytics about how people interacted with your website. These analytics can give insights into information like, demographics of people that entered, what source they came from, their geographic location and more.
This information can be used to inform future decisions about competitions and other marketing activities. So it’s worth investing in analytics, so you can make informed business decisions that are backed with evidence.
Using Database for Marketing
Now that your competition is over, you will have a database of customers who have consented to receive marketing material. Using this data for marketing and sales is how you can generate a ROI from your competition.
There are several channels for using this data, either through physical or digital mediums. Physical communication will require printing and distributing content via the mail to peoples home addresses. In-comparison digital mediums offer much more diverse and cost effective methods for reaching people. For this reason, we will focus on digital channels.
Remarketing is a popular advertising strategy, which involves targeting people who have already engaged with your brand. In this context, the emails collected in the competition can be entered into advertising platforms and targeted with ads. Most digital advertising platforms like Google Ads, Facebook Ads and LinkedIn Marketing offer this ability.
This method of advertising can be expensive however, because it requires paying advertising spend to the platforms. You can expect to pay anything from 20¢ per link click to $1 per link click.
Email Marketing (EDM)
This is arguably the best value marketing to do with your database of competition entries. Because there is no advertising spend, the only the cost is your email marketing platform which might only cost a few dollars per month.
Email marketing is effective because it’s direct to the consumer and can contain large amounts of information, in-comparison to tradition ads.
Be careful to not send too many emails to your database, because your risk annoying them and forcing them to unsubscribe. Sending multiple emails a week is likely to annoy your database, aiming for a 2-3 emails a month is a safer strategy.
We hope these tips for running an online competition, give you some inspiration for getting started with running your own.
We’ve written another large article about how to run a trade promotions, where we breakdown some of the different styles of trade promotions that you can run in that article. Using these tactics in conjunction with your online competition will be sure to drive sales and engagement with your brand.
But what’s next?
It’s time to take the learnings that you discovered, and apply them to your next online competition.
It takes trial and error to master running online competitions, part of this is discovering what worked, and what didn’t. Being brutally honest in this stage of reflection is challenging, but it’s the best way to improve quickly.
If you need help with your online competition, don’t hesitate to contact us at Adlab, we’re online competition experts. We’ve got years of experience running online competitions for big and small brands.