Many people wonder why a company would giveaway anything at all. Companies are in business to make money so why would they giveaway anything, be it a $50,000 car or a free can of Coke. The truth is on the surface, it might look like a money loser to giveaway a prize but when handled and managed correctly, they are actually a way to boost sales.
The power of a giveaway goes much deeper than just giving something away. This happens because when consumers get something for nothing, they can respond is so many ways that they don't even realize.
Here are just a few of the reasons companies like to give things away:
You'll Buy More
Sometimes you might feel more inclined to buy products from them because you remember you entered or even won a sweepstakes they hosted. Sometimes the sweepstakes alone makes you have to buy. Companies use codes and symbols that are needed to enter to win a prize.
Another way a company can get you to buy through sponsoring a sweepstakes or giveaway is offering an entry with purchase. You are entered to win a huge prize package for every purchase you make, you might make more than one purchase so you have multiple entries.
Key Take Away= You might buy from them in the end.
You Visit Their Website and Check Out Their Other Offerings
When you go to their website to enter, you may check out other products that they have to offer simple because you are there. Because you've done this, the seed has been planted that their products are great simply because you now associate them with the possibility of winning. You might also stumble upon something else and choose to buy it on the spot just because it looks interesting and make a purchase.
Key Take Away= You might make a purchase from their website simply because you are on their website or in their store.
Their Product Gets in Your Head
Certainly, there are many reasons why a company will give away prizes. But most often it has to do with boosting their product recognition, expanding their consumer base, growing a fan base, and gain loyalty from consumers.
Many companies today understand the competitive landscape of today's marketplace and they know that often the best way to attract business is to offer some incentives or a great prize. They create a feeling and vision in your head without you even realizing they have done this.
Key Take Away= You remember their brand and make a purchase later.
It's Instant Exposure
Companies today know one of the best ways to increase their product sales is to increase their exposure. While the more traditional forms of advertising can work at promoting products or services, often times having a sweepstakes or a free giveaway will make people consider a product that they may otherwise overlook.
Key Take Away= They get people to recognize their products.
They are Collecting Data
Every time you fill out an entry form, you are helping the company to learn more about the people that are interested in their products. Hosting a sweepstakes or giveaway can be the perfect way to get a great deal of company or name brand exposure, and even free samples can start a loyalty base of new consumers. Getting people to directly input data that they can use to better market their products is key. Companies must get this data to continue to refine their sales and marketing plans. Hosting a sweepstakes is the easiest way to do that.
Key Take Away= They use the data you enter to build future marketing programs
The bottom line of any giveaway or sweepstakes is for the company to build their brand's awareness in the marketplace.
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