ADVERTISING Marketers work hard to stand out with enticements

The promotional boom is led by Pepsi's $1 billion giveaway.
CHICAGO TRIBUNE
Zero-percent financing? Been there.
Bottle-cap prizes? Done that.
Product points for logo-emblazoned stuff? Ho-hum.
During the last couple of years, American marketers have been stuck in a rut of incessant sameness in their marketing enticements, thanks to the aggressive promotion required during a down economy. Their frequency has rendered everyday, run-of-the-mill promotions virtually worthless.
So marketers are working hard to stand out this year, launching some of the biggest, and sometimes outrageous, promotions and sweepstakes consumers have seen in recent years.
PepsiCo is running a promotion to give away $1 billion -- the biggest promotion in its history. To make it more outlandish, Pepsi is having a monkey pick the winner.
Other prizes
Also, United Airlines, whose parent, UAL Corp., is in bankruptcy, launched its first promotion giving away free international tickets. In the past, the airline has given away only domestic tickets.
And Volkswagen, which said this summer that zero-percent financing was no longer enough to grab customers' attention, has begun co-branding campaigns with high-profile marketers of other consumer products. One promotion gives away an Apple Computer iPod with the purchase of a new Beetle as a way to lure customers to the showrooms.
Meanwhile, marketers who don't have the budgets of a Pepsi are trying to get more clever than ever.
Fast-food restaurant chain Sbarro Inc., for example, is squeezing music CDs into drink lids to attract more young customers to its restaurants.
All of which makes that scratch-off game you're so familiar with look as outdated as Atari's Pong.
"Bonus packs and discounting are now the cost of doing business," said Jim Holbrook, president of St. Louis-based Zipatoni Co., which develops and produces promotions and events for such companies as Dr. Pepper/Seven-Up and Miller Brewing Co.
"Consumers are bored to tears. What's new out there? I'm pelted with zero-percent financing and 99-cent burgers every day."
After a slide in 2001, promotional spending grew at a faster clip than advertising spending in 2002, according to industry trade magazine Promo, which pegged 2002 promotional spending at $233.7 billion. But in a clear sign that companies are looking for bolder and more buzz-creating marketing, the fastest-growing segment is event marketing, which grew 15 percent in 2002.
And this year appears to be on pace to top last year's spending.
"Promotions have really come of age this summer," said Jerry Dow, United's director of worldwide marketing communications. "There do seem to be more big promotions trying to capture everyone's attention."
But the surge in bigger, broader promotions has been a godsend to an industry that was hurt by the Sept. 11 terrorist attacks, which left few customers in the mood for fun and games.
"[Companies] can't sit on their hands anymore," said Zipatoni's Holbrook. "Everyone knows advertising effectiveness is down. So they are saying, 'I have to do something. I have to put it somewhere."'
That has included bigger promotions, which are increasingly multifaceted.
The way it's done
For example, Pepsi will announce its prize winners during a two-hour television show it's sponsoring this fall on the WB network. It even hired comedian Drew Carey to be its host.
"We need to break through with the retailer as well as the customer," said Katie Lacey, vice president of colas and media at PepsiCo. "You need to connect with the consumer who is being bombarded with more messages than they were five or 10 years ago."
That has led to dramatic changes in how promotions are conducted. The sluggish economy has forced companies to be more accountable when it comes to sweepstakes. With so much pressure on getting a bang for every buck spent, marketers have to be careful to structure promotions that can produce a sales increase.
No longer can companies afford to do a promotion just for the buzz it might create.
"I don't think it will ever get back to the crazy, huge stuff. Every meeting we're in now, questions are asked about the payout," said Holbrook.
"The word I used to hear in the '90s was creativity. But then that at some point came to stand for waste and frivolity. Now the buzzword is innovation. It's creative but being smarter about it."