Twenty years ago, every cereal box on the shelf contained a plastic toy designed to lure young consumers away from rival brands. Red Rose packed a ceramic figurine in every box of tea while gas stations gave away glassware and key chains.
Today, you would be hard pressed to find a child in Canada who doesn’t already have a cupboard full of sophisticated, hi-tech toys, so cheap figures don’t really cut it anymore. Thanks to this raising of the bar, you’re now more likely to find a DVD lurking beneath your cornflakes, or an offer to send away for a CD-ROM game with three cereal box lids.
‘Low value giveaways just aren’t compelling enough to the consumers,’ says Martina Siegel, marketing manager for Kraft Canada’s Post cereal brand. In fact, Post has opted out of the in-box giveaway market altogether, in favour of an on-line auction.
‘We used to offer small gifts in the cereal boxes but today that approach doesn’t really have much of an impact,’ Siegel continues. ‘It’s been done to death, so we wanted to do something different that allowed us to break through the promotional clutter. This is a really unique program that allows us to appeal to all age groups at once.’
The promotion, called Post i-Bid, runs from May to October of this year. During that period, concealed codes on the inside of Post cereal boxes can be entered at www.postibid.com to bid on high-value prizes including skiing vacations, a trip to the Bahamas, sports gear and electronics goods.
But while Post has sworn off trinkets, Kellogg Canada is continuing to offer in-box surprises by cutting the frequency and upping the quality. ‘Immediate gratification works for kids,’ maintains VP of marketing Mark Childs. ‘It adds to the immediate value of the brand, and it builds loyalty because kids are happy to come back for two or three in a set of collectibles.’
In one such example, Kellogg packed 1.5-million DVD movies valued at $29.99 each into boxes of Frosted Flakes, Rice Krispies, Froot Loops and Corn Pops this summer – a far cry from the model planes and foam-stuffed sweetheart dolls of the 1950s.
In another promotion this year, Kellogg teamed up with Disney Interactive to offer an in-pack CD-ROM game tied to the movie Atlantis. Consumers were also invited to send in codes from two Kellogg’s boxes to receive three free Atlantis water toys, and to enter an on-pack contest to win one of four $25,000 prizes.
Similarly, General Mills has offered consumers the chance to collect CD-ROM versions of Hasbro Interactive games such as Monopoly.
‘The advantage of a send-away incentive is that we can give the consumer something of more substantial value,’ says Childs, ‘because not everyone will make a commitment to wanting the gift.’
Still, according to Childs, expensive hi-tech gifts are not always necessary: novel concepts can sometimes make up for what a premium lacks in cost and sophistication. ‘At the end of the day we’re talking to kids,’ he says. ‘They are the same, generation after generation – always fascinated by fun, cool stuff. If we have a creative idea, then sometimes the plastic toy still cuts it.’
In fact, some of the older ideas are being recycled today. Childs cites the example of a toy submarine, which was given away in the 1950s. With the use of a little baking powder, the toy would plummet to the bottom of the bathtub and then resurface. Today, Kellogg uses the same device in its Atlantis water toys. They may look more sophisticated, but the mechanics are identical.
In another low-cost, but high-impact promo, General Mills won the hearts of consumers by offering Y2K pennies in 10 million cereal boxes in last year’s Millennium giveaway.
Beyond the cereal isles, gas stations too are finding that consumers are no longer attracted by the plastic key chains of old, and have turned to more long-term loyalty programs offering more valuable incentives.
Like most other gas stations, as little as 10 years ago Imperial Oil was well known for giving away low value gifts such as tumblers and gift bags at its Esso stations.
‘We found that those short-term promotions were very hit-and-miss because they rewarded all customers equally, rather than encouraging loyalty,’ says Imperial Oil’s Sarah McLaren. ‘It was a relatively high-cost process, and we found that business was just being traded back and forth between all the gas companies, so it was time to do something different to serve our customers’ needs.’
In the early 1990s the company began to make use of new technology to collect information about the customers and find out about their buying patterns. This led to the Esso Extra program, which started in 1997, and in 1999 was expanded to a system of points and rewards. Last year, Esso started its online redemption program. Customers can now claim a free car wash or extra gas in return for points collected.
Shell Canada has also dropped the old-style giveaways in favour of loyalty incentives (although some independently owned Shell gas stations still offer dinner-service premiums).
In the 1980s, the company was well known for giving away free gifts or selling glasses and cups at a very low price. But by the early 1990s, Shell began to re-evaluate what it wanted from consumers, and in 1992 Shell’s Air Miles program was launched. This program is still used today, in combination with intermittent contests.
‘We have found that nothing else has the power of Air Miles,’ says David Saint-Laurent, manager for brand loyalty and fuels at Shell Canada. ‘It is a way of rewarding customers for their loyalty.’
Along with mail-ins and loyalty programs, competitions also solve the problem of offering more valuable incentives without breaking the bank. Many consumers will be lured by the possibility – however small – of winning a big prize.
For example, in 1997 Imperial Oil gave away Icemorph Invasion comic books over a period of six weeks with every 25-litre fill-up from participating Esso gas stations across the country. The promo was part of a competition in which kids were invited to collect a series of six comic books and write the ending to a story to win a trip to the Kennedy Space Centre in Florida, a $1,000 scholarship from the Bank of Montreal or one of 20 Nintendo games.
Lipton Monarch-owned Red Rose Tea is another to give up on the in-pack premium game in favour of contests with high value prizes. The brand is currently giving away prizes worth $5,000 every month this year in its ‘A Cup’ll Do you Good’ contest. At the end of the year, one winner will receive all 12 prizes, ranging from vacations to a new kitchen. Consumers can also register to receive ‘teamail’ newsletters, and in return will receive a set of free note cards.
Tetley Canada has opted for higher value premiums as well, but it has chosen the mail-in route. A free china cream and sugar set decorated with the Tetley logo is currently on offer in exchange for five box lids and a small fee for postage. Tetley fans can also purchase items online from the Tetley Tea Folk collection.
