Incentive world preview: Incentives put to the test

Marketers must test promotional gifts ahead of launch to make sure they match their target.

Cash, cars and holidays once formed a simple triumvirate of promotional prizes that would invariably deliver immediate results for a brand, regardless of its objectives. The prizes, after all, could not fail to trigger a response from consumers.

But the magic formula's effectiveness has waned, and the result is a harder life for promoters. With a proliferation of incentives on offer and time at a premium, consumers have become more choosy about which prizes to go for.

Whereas 'testing' the big three for their suitability as incentives to change behaviour would once have consisted of taking a stab at perceived value, now innovative premiums that offer choice must specifically target consumers' needs.

So marketers have had to embrace the full range of premiums on offer, innovating and sourcing incentives to match target markets more closely, as categories become increasingly competitive.

But with variety has come added responsibility. "Our agencies develop some great ideas, but ultimately it is our responsibility to ensure we bring the best to every consumer who receives a premium with our product," says Andy Duff, promotions manager at Kellogg.

Duff is not just paying lip service to this concept of responsibility.

As might be expected, Kellogg rigorously tests its premiums against a vast range of criteria.

As well as measuring consumer engagement - including playability and value - against purchase price, the cereal manufacturer applies the strictest quality protocol to all the premiums it offers.

This, says Dave Lawrence, plan-ning director at Logistix Kids, one of Kellogg's promotions agencies, is "absolutely critical". "Brands can ill-afford to have their products recalled or their image tarnished because of the adverse effects of a promotional premium," he explains.

Toward the end of 2002, the BeyBlades battling spinning-top toy phenomenon was just taking off in the US and Japan, and Kellogg decided to place it at the heart of its activity.

Logistix Kids devised on-pack activity featuring the toy that ran across all Kellogg's kids' brands in November of that year. The campaign was designed to motivate purchase and provide an incentive to switch brands.

A collection of eight Kellogg 'attack spinners' was developed as an instant in-pack toy that doubled as a collectable series of exclusive add-ons for kids to customise their own BeyBlades.

The promotion hit the shelves just as the BeyBlade craze was beginning to emerge in the UK. Research showed it was the top promotion for awareness among kids during its shelf life, while 35% of the prime target audience (eight-year-old boys) asked for the product as a result of the promotion.

Central to this campaign was ongoing testing and research not just into the premium, but also into aspects such as playability.

Test results

Other than health and safety, Duff says the most important criteria when it comes to assessing the suitability of a premium are appeal, play value, engagement with kids, and value as perceived by adults.

"As a team, we play with the premiums ourselves - our office looks more like a toy factory than a cereal company - and many Kellogg staff are currently walking around with pedometers (for a Special K promotion) hanging off their waists," he says.

The cereals category makes prolific use of promotions, and has to remain on its toes when it comes to testing. But while one would expect a sector leader such as Kellogg to be stringent, are all markets as attentive?

Brand teams tend to be intimately involved in every promotion, from attending initial brainstorming sessions through to the selection process and, of course, implementation.

Andrex, which is currently running an on-shelf 'Say Thank You' campaign, has always been active promotionally and has worked with sales promotion agency SMP since 1998.

"The right premium and the right offer are key to a promotion's success, whether the premium is a soft toy or a choice of five free rewards for the family, such as those on offer with 'Say Thank You'," says Andrex brand manager Ailsa Tiley.

The current activity began by identifying insights into consumers' family lifestyles and life stages. From there, a range of potential rewards was developed and fine-tuned with third-party suppliers to assess feasibility and outline costs.

The options were then opened up to group research, enabling the brand and agency to rank consumer preferences and choose the suitable reward and, as a result, the reward supplier. SMP and the Andrex team then agreed the final five rewards.

Yet when it comes to the nitty-gritty of testing premiums, the so-called 'dippers' - those brands that use promotions infrequently - tend to be less conscientious, relying on their string of suppliers to advise and test.

And even those brands for which promotional activity is the norm can become blase, according to Ray Jobsz, founder of electrical premiums supplier EIC. "Marketers rarely test electrical premiums because in general, they assume they know the specifications of an electrical product or rely on their suppliers to test it for them," he says.

"Most of the time they are fine, but when it comes to matching perceptions, there is no substitute for testing. We do our best, but suppliers are not always aware of a client's needs or objectives."

Caroline Meechan, director of sales and marketing at Marriott Incentive Vouchers, agrees.

"You don't want to raise expectation by calling something free," she says.

"If you offer a 'free' weekend with a caveat meaning the winner has to eat at a specific restaurant, it might cost the consumer more than the actual break would have done if they had bought it over the counter. That just damages the consumer's relationship with the brand offering them the incentive. Testing is one way to be sure of what is being offered to the consumer."

The most compelling argument for testing is that without a full understanding of the benefits of any premium, it cannot be sold accurately. Whether the premium is undersold or oversold, it will damage activity. More importantly, it will damage a brand's standing through premium recall.

As Logistix's Lawrence says: "No self-respecting promoter would compromise on premium testing."


Angus Peterson, Promotions manager, Heinz

Stepping back in time, zipping oneself into a flying suit and taking control of a vintage biplane is an amazing feeling.

Flying a Tiger Moth worked for me on a personal level. But even with my marketer's hat on, I have to say that for the right audience, this is definitely an aspirational incentive with a high-perceived value.

Flying such a stunning plane is the chance of a lifetime and, as such, it would be a great motivator for loyalty and trial. But it would have to be part of a wider promotional scheme, with a variety of other prizes available for grabs, since on its own, the experience could alienate the unadventurous.

There is a wide range of categories that would benefit most from using this sort of incentive: alcohol, personal grooming, clothing, upmarket store groups - just about any brand that is trying to reach adventurous men and women of all ages.

At the flying centre I attended - in Northampton - lessons are offered every day of the week and pupils can bring someone along to watch, which makes it very accessible for consumers.

The slight downside, which could prove problematic, is that there are only a handful of centres around the country that teach you how to fly a Tiger Moth, so winners could face a journey to get to one. But if the activity is wrapped up with an offer of transport to the centre as part of the prize, any inconvenience to the consumer can be avoided.

In any case, the journey is worth it, and at £125 for 20 minutes in the air with a qualified instructor, it is also very good value for money. I might take up flying Tiger Moths regularly.

Score 8/10


Diane Rowe, Promotions manager, Unilever Bestfoods UK

If you were targeting a female audience, this spa experience would definitely be an option. It ticks all the right boxes; it's an indulgent incentive for the ABC1 consumer profile, who are familiar with beauty salons but do not have the cash for a treat at such a premium level.

The spa's positioning as a premium treat is important and it is here that I would advise balance at sell-in point. While stressing the luxury element, it is vital to communicate the extra-special notion. If it feels too posh, it could risk alienating those who feel uncomfortable in very upmarket environments.

Given that this incentive would be most appropriate for cosmetic brands and white goods - for example, dishwashers, with the tagline 'Use the time you save on washing up to pamper yourself' - this segment could make up a fair percentage of your target market.

My other reservation is cost, which is about £100 for two treatments for two people, with lunch. For most marketing budgets, this means it is suitable only for competitions and loyalty drives, rather than a reward for a single purchase.

However, as Marriott offers it at 22 hotels nationwide, it should be easily accessible to most consumers.

I found the experience bliss. It took a while to absorb the introductory information, even when you think you are paying attention (which is why I had an icy jet shower instead of the jungle experience), but it was all very relaxing.

I am not sure at which point I drifted off to another world, but my head was still in the clouds long after I left. Now, may I please have someone permanently on hand to put hot towels on my back?

Score 9.5/10


Kate Fox, Marketing assistant, HarperCollins

Vouchers are a great one-size-fits-all option for a broad target audience, but what is attractive about the House of Fraser voucher offer is that it comes with the options of a personal shopper and makeover. The makeover would appeal mainly to women, and in terms of adding value, it's a strong sell.

It's a great incentive for ABC1s, who are familiar with the fashion labels carried by the store, as well as the slightly older market looking for classic items, or something for their home or children.

House of Fraser stores also attract the 'bright, young things' who aspire to the latest fashions and make-up featured in the glossies. But importantly, I felt no pressure to buy and, unlike other expensive stores, I did not feel intimidated. You are free to wander, try and touch, all in your own time.

This incentive could be used for various products, since the vouchers come in a range of amounts, but is best suited to a 'luxury' goods positioning.

You could offer a big sum for a major competition or promotion (for which you could also flag up the extra services offered, such as personal shopping), or smaller amounts to boost repeat-purchase or recommendation.

I really enjoyed the freedom and luxury of being able to buy what I wanted without worrying about the expense. Inevitably, for someone who enjoys shopping so much, I ended up exceeding my voucher amount, but it was a real treat and I will beg, steal and borrow to get more vouchers.

Score 9/10


Mary Davidson, Head of marketing, Esure

As a single item, this digital radio could be used by radio advertising companies to target media buyers in client or agency organisations to promote the medium as a highly effective marketing channel.

In fact, this is how I first came across the gift - something almost identical was given to one of my team for this very purpose. He loved it, so I think it would prompt a response from the client and at the very least would generate a meeting. It would certainly make you reconsider the power of radio in the media mix.

As a consumer incentive, it has a lot going for it too: it has a high perceived value and is compact. And its fashionable retro/modern styling means it would not look out of place in a home environment.

Its functionality is a doddle, and as a premium incentive, it has the unusual advantage of appealing to a number of target markets: men, women and even teenagers.

It might even encourage recipients to want similar products for other members of the family, so if this was one of a number of electrical premiums used to drive repeat-purchase, it would probably be a winner.

But therein lies the rub. The radio costs £99, making it accessible to marketers - even for those working on a shoe-string budget. But to make for a really aspirational consumer campaign, this digital radio would have to be just one of a number of electrical premiums, which would inevitably increase costs.

As a one-off, it works. Its credentials as a valuable gift are strengthened by the fact that it is an award-winning product, a fact that is clearly highlighted on the packaging. And of course its digital capability means radio never sounded so good.

Score 8.5/10


Date April 20-22

Venue Earls Court 2

Visitor profile Incentive World organiser Reed Exhibitions claims that the event is the UK's biggest promotional marketing exhibition.

Last year, more than 5500 visitors ventured through the doors of the show. Attendees ranged from MPs and brand managers at the major blue-chip companies to entrepreneurs looking for the next big thing.

Visitor numbers in 2004 are expected to be on a par with 2003, with Reed's Incentive World exhibition director, Versha Carter, claiming the emphasis has been on delivering quality visitors to the event, rather than freebie-hunters.

This focus has seen the organiser build a database of potential visitors, notably incentive and loyalty buyers from the automotive, financial, FMCG and call centre sectors.

Exhibitor profile Some 350 companies are expected to exhibit this year, covering sectors as diverse as clothing, clocks, badges, pens, toys, games and game-cards, through to the ubiquitous voucher suppliers.

As ever, the bulk of the exhibitor contingent comes from premium suppliers, but the industry's trade associations, including the Institute of Sales Promotion (ISP), the British Promotional Merchandise Association (BPMA), the Voucher Association, and first-time exhibitor the Chartered Institute of Marketing, will also be at the show.

The BPMA is once again sponsoring the New Product Pavilion. This year it is introducing on-stand clinics covering taxed award schemes, copyright and intellectual property, and employment law. Meanwhile, the ISP is holding its Promotional Marketing Awards dinner and presentation on the last night of the event, with its Awards Gallery also making an appearance.

Seminars Last year's inaugural seminar programme has been refined under three central themes: rewarding employees, attracting customers, and driving sales.

Keynote sessions will mark the start of the programme each day. Speakers on the first, second and third days will be Goldfish commercial manager Jonathan Harris, Strand Technology managing director Graham Phillips, and Michelle Smith, vice-president, strategic sales, at Bravanta respectively. Other speakers will include Savoy Group human resources director Sara Edwards and John Greenway MP.


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