The economic downturn is renewing interest on Madison Avenue in a marketing mainstay that is particularly popular during tough times: cash giveaways.
Contests and sweepstakes with money prizes rather than merchandise like cars, furniture or trips are appearing more frequently as the financial crisis continues. In some instances, the dollar amounts are as high as seven figures, as in a contest with a $1 million bonus being sponsored by the Doritos brand of snack chips sold by Frito-Lay.
Who wants to be a millionaire? These days, just about everyone -- even people who a few months ago were billionaires.
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"Everyone is trying to get you to buy something at a time when no one is buying," said Michael Watras, president at Straightline International, a brand consultancy in New York. "They've got to do what they can."
The trend includes these other examples:
"Secret Millionaire," which Fox Broadcasting will introduce on Dec. 3. The reality series features wealthy men and women who live incognito in everyday neighborhoods, deciding whether to give up to $100,000 of their own money to deserving residents.
Although Fox, part of the News Corporation, announced the show in May -- when the Dow Jones industrial average was about a million points higher than today -- "it comes on at a time when people are more attuned to the fact many of our fellow citizens are having a hard time," said Chris Coelen, chief executive of RDF USA in Santa Monica, Calif., which is producing the series.
Dubai Duty Free is dangling a $5 million prize in a raffle that is being called "the world's biggest duty-free promotion." The winner will be chosen from among the purchasers of 5,000 tickets, each costing about $1,360.
"Wheel of Fortune," the game show syndicated by a unit of the Sony Corporation of America, is celebrating 5,000 episodes by giving away $5,000 a day through May 24, 2009, to members of the Wheel Watchers Club. There is also a "Spin ID sweepstakes," with a $50,000 prize, for viewers who have Sony Card Visa credit cards.
The trend echoes what took place during the Depression, when marketers eagerly gave away cash prizes on radio quiz shows and in contests advertised in magazines and newspapers. Some, like a puzzle contest sponsored by Old Gold cigarettes, which offered what Time magazine described as an "unprecedented $100,000 first prize," became national crazes.
Two decades later, when television supplanted radio, the dollar amounts ballooned; the radio quiz "The $64 Question" became "The $64,000 Question" on TV. More recently, the money multiplied again, with shows like "Who Wants to Be a Millionaire" and "Deal or No Deal."
"Money has been an incentive for a long time," said Andrew Keller, vice president and co-executive creative director of Crispin Porter & Bogusky, part of MDC Partners. "Certainly the notion of offering money at a time like this is more appealing."
For a client, Volkswagen of America, Crispin Porter worked with @Radical.Media on a series for the Speed cable channel that chronicled a race among 30 drivers, ages 16 to 26, featuring Volkswagen Jetta TDI clean-diesel cars. In a 90-minute documentary, "Racing Under Green," that Speed showed on Saturday, the winner of the race, Josh Hurley, 23, of Cooper City, Fla., won $100,000 from Volkswagen to begin his racing career; he will win another $150,000 if he lands a berth with a professional team.
"For young people getting into racing, they've experienced for some time what might be termed a financial crisis," Mr. Keller said, "because it's an expensive sport."
However, at a time when many companies have less to spend on marketing, Mr. Keller wondered whether giving cash to consumers amounts to " 'renting' them to participate in your advertising."
That thought was echoed by David Melançon, chief executive at the Ito Partnership, a brand consulting company in New York, who warned about the long-term implications of what he described as "selling out your brand for a couple quarters of growth."
"While you can say, 'If I don't make it through the next two quarters, there is no long term,' certain marketing tactics are like taking a mortgage against your brand," Mr. Melançon said, "and mortgages are what got us into this."
A cash giveaway can make sense "when it connects in the consumer's mind to the brand's purpose," he added, citing a contest sponsored by CNBC called the CNBC.com Million Dollar Portfolio Challenge. The first prize is $500,000 in cash, the second prize is $200,000, and the third prize is $100,000.
"The prize money is certainly attractive," said Tom Clendenin, vice president for marketing at CNBC, part of the NBC Universal division of the General Electric Company. "But people like the opportunity to learn more about the market and about the cnbc.com site."
This is the third time for the contest, which was first played in spring 2007 and returned in spring 2008. The fall run began its make-believe trading on Nov. 17 and ends on Feb. 6, 2009.
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"We're trying to capitalize on the traffic to the site," Mr. Clendenin said, referring to the increasing number of visitors to cnbc.com, "as well as drive people to the site." The contest has "thousands of players," he added, declining to be more specific.
For the Doritos contest, Frito-Lay, a unit of PepsiCo, is somewhat more forthcoming with statistics. The $1 million bonus has resulted in "a pretty significant increase" in entries, said a spokesman for Frito-Lay in Plano, Tex., Chris Kuechenmeister to more than 1,700 from about 1,100 for a previous contest.
The Crash the Super Bowl contest asks consumers to create commercials for Doritos for a 30-second time slot during Super Bowl XLIII on Feb. 1, 2009. Five finalists will be announced in January; each wins $25,000. Computer users will be able to vote online from among the five spots for the commercial they want to see during the game.
If that commercial is ranked first in the annual Ad Meter poll conducted by USA Today, the creator gets the $1 million bonus.
Although the idea for the bonus came well before the financial crisis began, "certainly the $1 million prize is something we thought people would find attractive," Mr. Kuechenmeister said.
Asked whether a million dollars seemed more valuable today than when the idea was developed, he replied, laughing, that even "a dollar seems more valuable today."
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