Promotions 2.0Blurring the line between interactive advertising, promotions and social network marketing.

March 6th, 2009

5 Reasons Promotions Thrive in a Down Economy

As the economy continues to tumble, Marketers are looking for ways to squeeze more value from their budgets. Here’s what smart marketers should know:

1) Brand awareness ads lose their effectiveness. Advertising (or disruptive messaging) is mostly about generating awareness and reinforcing brands. In a recession, ordinary consumers aren’t as willing to spend. Sure, we’ll be aware of the product, but that doesn’t make much difference when you’re not spending. Advertising is also expensive and is a lot easier to cut than headcount.

2) Promotions are about engagement not awareness. Sweepstakes, Promotions & Contests are about rewarding consumers for their attention. You may resist advertising if your finances are tight, but if you have a chance to win cash or a great prize in a down economy it is more likely to get your attention.

3) Social media creates promotion buzz. Consumers are more likely to tell their friends about a great promotion than a brand. Blogs, word of mouth, social networks… are all about people connecting with other people. You may resist advertising if your finances are tight, but if your bud tells you that you could win a new car or tickets to the World Series, that’s more persuasive than advertising. Basically, in a recession, engagement is more important than awareness — and that’s where advertising flops and promotions succeed.

4) It’s less expensive. An interactive promotion campaign is typically $20K to $150K — a lot cheaper than a significant sized ad campaign. Recently we have seen significant growth in promotions paired with social media.

5) It’s measurable. Interactive promotions are highly measurable,  if it generates leads, or conversions, or buzz, or something useful — then you can prove it’s working. But you need to have a plan before you get started.