Do promotions actually drive revenue? Or are we rewarding players who are coming anyway? Monthly promotions, or as we call them at Red Circle, Mass Promotions, account for a large chunk of Marketing’s monthly budget. How do we make sure we’re confidently using these dollars to drive profit? Are we planning promotions to fill a calendar or are we making data-driven decisions to drive incremental revenue through our active database? Here are 5 strategies to follow when you’re creating promotions to maximize your revenue-earning potential.
- Establish a measurable goal you want to achieve through a mass promotion.
- “Drive revenue” is an overall agreeable statement, but it’s hardly a measurable goal.
- Are you looking to drive incremental revenue on a single grand prize/finale drawing day? A grand prize finale weekend? Weekly cash/prize drawings?
- Use data to identify your target promotional dates based on your revenue goal.
- What calendar days present you with the biggest opportunity to drive incremental revenue? Data-driven target dates can be identified by a combination of factors such as seasonality, historical player behavior, competitive analysis, holidays (some work, some don’t), and last but not least, the forecasted revenue budget.
- Hard-coding promotions into your calendar is a dangerous game. If your promo target dates are so consistent that they literally never change, this becomes an entitlement program for your players and not an incremental revenue driver.
- Data-driven promotional logistics.
- Combining your measurable goal, target dates, and relevant data will establish your promotion logistics so that they support your revenue goal. This will also help you establish your KPIs for reporting.
- Revenue Attribution – which days count and which ones don’t.
- DO NOT attribute daily revenue to days without an actual, tangible driver or incentive. Just because players may be able to earn entries all month long, that doesn’t mean we should attribute that revenue to the promotion.
- DO count the days that Marketing incurred expenses to measure participant revenue, such as free play drawings or grand prize giveaways.
- Create urgency.
- If you introduce a new promotion and it’s a huge success, you might be tempted to continue it the following month and the month after that, and so on. But be cautious.
- Again, I repeat, hard-coding promotions in your calendar is a dangerous game. Over time, the promotional structure loses its impact on successfully modifying player behavior, and its power as a successful driver diminishes. What results is a promotion that started strong and lost its urgency over time, thus resulting in an entitlement program for your players.
- If your promotions are predictable and do not create urgency, then it becomes an exercise in spending money, developing creative and ordering signage.
If you aren’t thinking of these top 5 strategies when creating your promotions, there is a good chance that you may not be successfully maximizing your incremental revenue-earning potential.
Red Circle would love to help you create promotions that make the most of your dollars. Call Angel Suarez at 612-875-7131 for more information.