In the independent retail realm, finding new customers can be a challenge. Between tight marketing budgets, increased online shopping, and competition from the big-box stores, just getting noticed can be an uphill battle. Enter the giveaway, a game changer.

What’s in a freebie and why does the simple act of receiving something without a price tag make us so happy?

“The reciprocity principle says that our minds tend to place a higher value on items that are offered for free compared to other promotional discounts,” writes SaaS marketing consultant Jessica Perkins. “When someone does something for us, we naturally want to return the favor. In the business world, a freebie can be an initial gesture that motivates customers to reciprocate through loyalty, repeat business, brand advocacy, and word-of-mouth advertising — the most powerful marketing tool of all.”

Additionally, when customers have a positive experience during a promotion, they’re more likely to remember you and consider your shop in the future.

Giveaways have long been, and still are, an effective tool in retail marketing. Traditional methodologies of developing and marketing contests and giveaways still hold. However, retailers who also utilize social media to promote in-store promotions can enjoy even bigger dividends.

The key benefits of retail giveaways are creating customer engagement, generating interest in products and services, and getting the customer to act. The increased engagement builds a deeper connection with customers and fosters loyalty and long-term relationships.

Beyond engagement, you can increase brand visibility, generate a buzz that attracts attention, expand your reach to potential new customers, and realize sustained business growth. Giveaways also help you gain a competitive advantage, stimulate impulse purchases, and gather customer insights.

Giveaways come in all shapes and sizes, from gifting customers logoed goodies to offering a sweepstakes to win a $2,000 rifle. The path you choose to take is based on your goals for the giveaway and the amount of effort you require of participants. A wide range of other factors also come into play.

Giveaway Blueprint

Follow this blueprint to develop your giveaway. Each element is important to the success of the promotion.

Set clear goal(s). Whether you want to collect customer data (such as email addresses or shopping preferences), promote a new product or service, or increase social media followers, always begin with a clear objective. The more specific your purpose is, the easier it will be to plan and implement a successful campaign. Understanding your audience’s preferences, interests and demographics, and tailoring your giveaway to capture their attention and resonate with them, is critical.

Determine the metrics. Metrics include items like store and/or website traffic, conversion rates, sales, social media engagement, hashtags, referrals, and email signups. Your metrics will most likely be driven by your goal(s) and will be the elements you look at to determine success of the campaign.

Pick the prize. When choosing your prize, it’s important to balance budget, customer appeal, and relevance. You must know your target audience and understand what they are willing to do to win. The prize must also be proportional to the amount of work involved in participating. Even though the prize is free to the winner(s), it still needs to offer value. If you’re looking to increase foot traffic, you may want to focus on a more substantial prize than you might if using a social media giveaway to get more followers. For driving store traffic, a rifle or optic giveaway will be enticing. Online, a simple $50 gift card to your shop may get the job done.

Determine your format. The format is nothing more than the type of giveaway you choose. You have several choices of giveaway formats. Review the list provided by Nerdwallet.com and choose the one that fits your goals and style of marketing.

Set up the giveaway rules. Participation rules must be based on what is legal in your state (see list from Varnum Law) and should include the giveaway time frame and entry deadlines, who may participate, age requirements, how to enter, where and when the giveaway takes place, prize value, number of participants, how winners are selected, and more. When presenting the giveaway instructions/participant rules, be clear and concise, yet appealing. Most of all, make them easy to understand.

Launch and run the contest. Image really is everything. So, select a striking image that’s highlighted in all your communications. The image should draw attention and tap into your customers’ and potential customers’ interests. Thus, a great promotion image will not be a generic giveaway image or graphic. Use a striking, storytelling image. Consider a standard rifle image, the gun on a white background vs. a beautiful advertising-style image of the same gun. Which garners attention and generates excitement?

With all the above completed, marketing the promotion becomes the focus. And no, your in-store display alone won’t get you anywhere. Utilize all avenues to promote the giveaway. Email existing customers, place signage and a great display in the store, and promote it on all your online platforms, websites, blogs, and social media.

This multi-channel approach ensures that the promotion reaches a wide audience, increasing brand exposure and visibility. As a result, more people become aware of your brand, products or services, and its value proposition.

Also, encourage sharing. Nothing is more powerful in marketing than word-of-mouth promotion. Thus, it’s important to find ways for those entering the giveaway to share it with others. In-store selfies customers can post, hashtags specific to the promotion, and share buttons on posts are just a few avenues you can take (see Make Social Media Generate Buzz and Increase Reach).

Also ask outdoor influencers to share the giveaway on their platforms to generate more buzz and expand reach. These influencers can be local range owners/instructors, well-known local hunting guides or lodges, your staff, and other well-known personalities.

Consider advertisements in highly focused publications too. They allow you to have greater control of your target audience. An ad in the “Your Town Today” newspaper/magazine may not be as effective as an ad in your state’s Department of Natural Resources hunting guide. Your focus must be on the consumers you want to reach. Look at all your options.

With all the above done, it’s time to announce your winner. The big finale should be exciting and fun and should involve as many people as possible, in-store and online. You can simply select the name and announce it, but why? Make it into an event for additional engagement, buzz, and promotion. Consider live streaming the winner selection and presentation. Engage a local celebrity to emcee. Set it up around a planned event. After selecting the winner, promote who won. Get some comments from the winner. Take pictures. Every bit of this is fodder for promoting your business now and down the road.

Last, but not least, evaluate the giveaway’s results. Evaluation is all about return on investment (ROI). Did you meet your goals with the giveaway? If you did, you met your ROI expectations. However, further evaluation is helpful.

Focus on the important metrics such as the number of participants, comments, engagement levels, number of followers, traffic on the website, shop purchases and user feedback, to examine whether the giveaway was relevant to the audience you wanted to reach.

Beyond relevance is cost-effectiveness and/or return on investment (ROI). Measuring the ROI on promotional giveaways is not as simple as using the standard ROI equation of 

A (net profit) – B (cost of investment) x100 = ROI %

But there are ways you can get some decent metrics. Cost per engagement is an easy calculation of total costs divided by the number of engagements. Did the giveaway generate any sales, how many engagements were first-time connections, what online platform produced the best results, and did advertising bring in people? All this information saves you time and money in the future, as you can use it to better gauge how to optimize your next giveaway. You may even want to consider software or service providers who provide tracking options.

The sky’s the limit with giveaways, and the benefits are undeniable. They let you build buzz, engage customers and potential customers, promote your business to a wide audience, bolster name/brand recognition, foster customer loyalty, and introduce new products or services. Everyone loves free stuff. So, put that fact to work for you.

Promote Your Giveaway Online

Mohammad Yaqub, founder of BusinessDIT, reported data on the effectiveness of promotions on social media in his report “Do Giveaways Increase Sales? (8+ Statistics and Data)”. The numbers are staggering and a clear sign your shop’s giveaway should also be promoted through your social media pathways. 

Here’s a look at some of the numbers:

• Giveaways have a conversion rate of nearly 34%, which is higher than other types of content.
• An average of over 34% of new customers are acquired through contests.
• Landing pages running a contest giveaway increased email leads by 700%.
• 45% of digital marketers agree that social media contests give them a good return on 2investment (ROI).
• 62% of businesses use giveaways to increase brand awareness.
• Instagram accounts that host giveaways grow 70% faster than those that do not.
• 32.5% of brands host one monthly giveaway, and 16.1% host two or three.
• 55.8% of brands run giveaways on multiple social media platforms, mostly Facebook and Instagram.
• 28.6% of brands run multiple contests per year but less than one giveaway per month.

Legalities

“When planning a giveaway, companies should exercise caution and thoughtfulness regarding what the giveaway will entail, how customers will be expected to participate, the value of the prize, and where the giveaway will be applicable,” says the Varnum law firm. “If done carelessly, an innocent giveaway can subject a company to a wide range of civil and criminal liability, all in the name of a product or service promotion.”

“First, a company should know whether it intends to run the giveaway as a sweepstakes or a contest,” Varnum adds. “This distinction is important, as each requires consideration to avoid liability related to lotteries and gambling. Generally, the difference between sweepstakes and contests is how the winner is selected. Sweepstakes involve prizes that are awarded based on chance, while contests award prizes based on knowledge or skill.” 

While every state is different regarding the exact information that should be included in the official giveaway rules, Varnum says the consensus is that the official rules should include the following:

• A statement that no purchase is necessary and that a purchase will not enhance the chances of winning.
• Information on how a party will enter the giveaway and how many entries will be permitted.
• A clear statement regarding the number of prizes available and the number of entries permitted.
• Information regarding entry eligibility (i.e., age and states of residence).
• Information regarding the verified retail value of the prize (i.e., if the prize is a grill, the rules should identify the verified value of the same in dollars).
• A statement regarding the odds of winning the prize based on the number of estimated and completed entries received.
• Information concerning the free method of entry if there is a method of entry that requires a purchase (i.e., alternative forms of entry that do not require the entrant to make a purchase or incur a cost for entry).
• Information regarding the name of the giveaway sponsor, including the name and address.
• Information about where the official rules can be accessed.

Most importantly, free options must give entrants an equal opportunity to submit an entry and win. In some situations, even a call and/or text message requirement may act as an entry for purchase, as the cost to call and/or text may be viewed as a fee to enter. To avoid potential liability, a company should disclose a free method that does not result in a standard-carrier fee.