Major sporting events often offer a golden opportunity for companies in terms of marketing and advertising. The large audiences that tend to follow competitions ensure many eyes that will see your ads, in an especially favorable environment.
When you get directly into the event through sponsorships, which is not always easy and never cheap, the exposure increases overwhelmingly. The big championships are also usually a recurring excuse to do promotional marketing, taking advantage of how Pisuerga passes through Valladolid.
As not all companies can use the branding of the event itself (the Olympics or major football championships can only be mentioned by their sponsors and with very clear rules), companies must be very inventive.
And that’s where promotional marketing comes in, making campaigns interactive and gamifying enthusiasm for competition. The company also manages to take away that positive perception that is linked to victories and good results.
The potential is very high, but unfortunately for the brands involved, so are the risks. When the framework that establishes the rules of your promotional marketing action depends on what third parties do over which you do not have any direct control and which is not exactly a matter of chance, the results can end up being very problematic from the point of view of economic view.
Stories of anti-success – or rather almost too much success – are fairly recent. Euro 2008 ended up becoming a nightmare for the electrical appliance chains that launched into striking promotional marketing actions linked to the results of the Spanish team.
The selection chained good result after good result and companies saw their promotional marketing expenses skyrocket. PC City had to return 161,000 euros in gift cards to consumers who had bought their computers in a promotion linked to the results (if they won the selection and you had bought an Acer computer, you got 100 euros as a gift voucher).
Much more bleeding was for Media Markt, which promised to return 25% of the price of televisions purchased in a week in May if the selection went beyond rooms. It sold 13,500 televisions. In fact, the promotional marketing action had a crazy cost: Media Markt had to return 1.7 million euros to its consumers.
The Spanish subsidiary recycled an idea that they had already applied in Germany or Italy, where they had to shell out even more money. Then, the chain explained that it did have an impact on sales. The promotion, they said then, “has led to an increase in sales of televisions during the period of the promotion, which we hope now with the exchange of gift cards will have an impact on the sales of other product families.”
Profitable in the end it must have come out, because in the World Cup they decided to give away free TVs if Spain won (although he added a small print that made it much less possible). In that World Cup, Media Markt was not the one that seemed to be the company that could be harmed the most with a positive result (quite a few companies did promotions of this style) but Carrefour, for which promotion linked to the World Cup entailed an extra cost of one million euros .
When the USSR Complicated a McDonald’s Promotion
These are the closest and most recent examples, but they are far from the only ones. In fact, one of the cases that are often pointed out of how promotional marketing can end badly financially dates back to 1984. So McDonald’s decided to take advantage of the pull of the Olympic Games, which were held in Los Angeles, in its native market.
Every time an American athlete achieved a medal, the chain would give out free chips, sodas and Big Macs. McDonald’s counted – needed! – with the athletes of the USSR and their allies, who would occupy positions in the medal table.
However, the Soviet Union boycotted the edition and did not participate, as did countries like East Germany, increasing the American medal options. Some chain restaurants ran out of hamburger buns and the promotion made them lose money. The impact of the promotion was so powerful that it has until its entry in Wikipedia. McDonald’s has never said how much it cost them, only that it was their most expensive promotional campaign of all.