Freebies top fast-food marketing menu

'Would you like fries with that toy?'...

‘Would you like fries with that toy?’

Walk into any fast-food restaurant nowadays, and that’s almost what you expect to hear. Freebies and other promotional activities have become such important items on the marketing menu in this category that the major chains seem to push them almost as hard as their burgers. And the scale of the giveaway stakes has escalated to the point where recent programs had over 100 toy models in the lineup.

As Rudy Hulsman, director of marketing for Taco Bell Canada explains, customer loyalty is in exceedingly short supply in the fast-food business. And that puts pressure on the chains to keep coming up with bigger, better and more elaborate deals.

‘Promotion has always played an important role in making what we like to call the McDonald’s experience,’ says Rem Langan, vice-president and national director of marketing with McDonald’s Restaurants of Canada. ‘Good promotions increase customer loyalty and they increase your store traffic.’

McDonald’s and Burger King remain undisputed leaders in this area, leveraging an impressive array of partnerships with entertainment and sports properties to offer all manner of cross-promotional giveaways. But some of the other players in the category are coming on strong.

Here in Canada, Harvey’s Restaurants has stepped up its promotional activities significantly over the last couple of years, as part of an overall effort to attract more women and families. Last spring, for example, the chain introduced a promotional tie-in with Crayola, offering free markers with every purchase of its new kid’s combo.

Robert Levy, vice-president of branding for Harvey’s, says customer demand is driving the chain’s promotional push. ‘It’s just something that our consumers said they’re ready for and wanted us to offer.’

Wendy’s is another chain that has made some major strides forward on the promotional front in the recent past. A peel-and-win contest launched last year was the restaurant’s first sweepstakes program in three years. And in November it unveiled what Desmond Edwards, director of marketing for Wendy’s Restaurants of Canada, calls the chain’s most ambitious movie tie-in ever: a cross-promotion with the Universal Pictures hit Dr Seuss’ How The Grinch Stole Christmas. The promotion, which ran from Nov. 13 to Dec. 25, offered one of five Grinch toys with every Kid’s Meal.

‘We saw our Kid’s Meal business grow tremendously,’ Edwards says. ‘To the point where we’ve finished with The Grinch and we’re still seeing numbers stay high.’

Tie-ins with feature films, sporting events and other high-profile entertainment properties are still considered the hot ticket in this category. McDonald’s, for example, is currently halfway through an exclusive 10-year cross-promotion deal with The Walt Disney Co. for its animation properties. Most recently, the chain ran a holiday-season promotion offering a series of toys based on Disney’s 102 Dalmations.

‘[Customers] trust McDonald’s and they trust Disney,’ Langan says. ‘So one plus one equals three in a case like this.’ (A Happy Meal cross-promotion with Disney’s forthcoming Atlantis: The Lost Empire is slated for June. Tie-ins with Dimension Films on the feature Spy Kids, and with Tiger Electronics, maker of the Robo-Chi robotic pet, are also coming this spring.)

McDonald’s also has partnership deals with the Olympic Games and the National Hockey League, both of which have been in place for more than a decade. Promotions tied to these properties are launched when it’s timely. A special hockey-card offer, for example, runs each winter prior to the NHL All-Star Game.

Burger King, meanwhile, scored a hit late last summer with a five-week promotion starring teen-pop sensations the Backstreet Boys. The chain offered the boy band’s rabid fans something they couldn’t get anywhere else: a series of exclusive CDs and a video, each available for $4.99. Backstreet Boys action figures were also included with all Kids Meals.

Entertainment cross-promotions do, however, have a certain built-in risk factor, since their success depends on the always-unpredictable vagaries of the pop-culture marketplace. For example, Tricon Global Restaurants – which owns Taco Bell, KFC and Pizza Hut – was disappointed by the results of its 1999 tie-in with Star Wars: Episode I – The Phantom Menace.

‘The film didn’t have the legs we thought it would, and that’s a big danger when you move in with a movie property,’ Taco Bell’s Hulsman says.

Still, Taco Bell has climbed back on the promotional horse. This past fall, the chain ran a program in conjunction with the World Wrestling Federation, offering customers a collectible WWF cup when they purchased a 32-ounce drink. Exclusive wrestling posters were also available for sale. ‘The attraction there was that the WWF is an evergreen product,’ Hulsman says. ‘It’s on [TV] every week, and viewing figures are very high.’

A tie-in with the Paramount Pictures film Tomb Raider is also planned for June. And Hulsman hints at Taco Bell’s interest in re-teaming with Lucasfilm on the next Star Wars prequel.

One aspect of promotional marketing that fast-food chains have just begun to explore is the potential for use of the Internet. Both McDonald’s and Burger King, for example, have experimented with using e-coupons to drive customers from their computers to the restaurants.

In December, Burger King launched an Internet promotion in the U.S. with FoxKids.com, one of the most popular Web sites with the 6-14 age group. Youngsters were invited to build a virtual burger online, then print up a drink coupon that could be redeemed at participating restaurants.

McDonald’s has made similar offers on the Canadian page of its Web site (www.mcdonalds.com). It also uses the site to hype new promotions, like its current tie-in with the Disney feature The Emperor’s New Groove.

‘On the Internet, information is instantaneous, so a lot of people are well aware of the promotions before we even start them – there’s a pent-up demand for them,’ Langan says. ‘It’s been a very effective way of letting people know what’s coming up at McDonald’s.’

Also in this report:

- The giveaway stakes have escalated: Advertisers getting more creative, experts say p.25

- Cereal premiums as hip as today’s kids: In-pack freebies now include high-tech goodies like CD-ROMs p.27