New Threat to Marketers as the rise of Hard Core "Compers" destroy value of marketing promotions
A new breed of ‘professional entrants’ to competitions and prize draws in the UK threatens to affect tens of thousands of marketing campaigns unless action is taken now by promoters, warns a leading marketing industry expert.
As a result of a squeeze on household incomes, coupled with the increasing cost of living, rising inflation and the 20% VAT rate, the number of people seeking tax free ‘money for nothing’ is set to explode. Research by leading promotions specialist PromoVeritas shows that ‘professional compers’ make on average at least 100 entries a week and will often have 10- 20 mobile SIM cards to make it easier to enter multiple times for ‘Text To Win’ type promotions. They also operate in syndicates, sharing entry forms, group buying promotional packs and tokens.
Some ‘professional compers’ even resort to using false names and fake emails to improve their chances of winning, with the result that their actions make it increasingly difficult for marketers to pick bona fide winners or to get a return on investment from such marketing activities which are frequently run to create a valuable database of future customers. “And that’s just the tip of the iceberg!” warns Jeremy Stern, CEO, PromoVeritas who advises some of the UK’s biggest brands on how to ensure that their instant wins, prize draws, competitions and voting activities are fair, comply with industry regulations and ultimately help to drive incremental sales for the client.
“In the past, marketers would judge the success of a promotion by the numbers of entries their promotions would attract. Today, this is an increasingly irrelevant measure as it could include a flood of entries from ‘hardcore compers’ who are just out to win anything and everything and by whatever means is available to them.
“Few brand owners or promotions agencies are aware of their techniques and even fewer seek to effectively guard against them leading to a massive waste of time and budget with no corresponding spike in sales. We know of individuals who win prizes on an almost daily basis, most of which is then sold on eBay that helps to fund their habit” he says. There are now a number of very popular subscriber funded magazines and websites such as Loquax.co.uk and Compersnews.com that offer advice on how to win, list all available prize draws and the answers to competitions and lists of prize winning tiebreakers that are often then re-used to enter a current promotion!
But promoters also have to be aware of failing in another area – compliance with the laws and regulations that affect the sector. The main rules relate to having ‘fair winner selection’ so prize draws need to be conducted either by an independent person or under independent supervision, the judging of competition must include at least one person who is both independent and competent in the chosen field and instant wins must have an independent audit statement to show that all the stated prizes or codes or tokens etc are available to be won and have been distributed at random across the total volume.
Money for Nothing
“Compared to other countries in Europe, we’ve a very liberal regulatory environment. We don’t need Government approval to run a draw or pay fees or taxes on the value of prizes as they do elsewhere. However, there’s still a high level of ignorance from promoters on how to properly run the back end of their promotions and this creates weak spots in a marketing campaign with consequent risk to brand reputations and wasted budgets” observes Stern.
Although an increase in ‘compers’ who do it for fun may not represent a massive threat to the marketing profession, those who do get hooked could end up requiring medical help to end their addiction. Professor Cary Cooper CBE, a leading organisational psychology and health expert at Lancaster University adds: “Comping is a peculiarly British phenomenon and doesn’t occur to the same extent in the rest of Europe. And with rising unemployment some people have become more desperate and seek alternative ways to fund a lifestyle they can’t otherwise afford. Habitual competition and prize entering can quickly take over an individual’s life because it offers significant rewards for a tantalisingly small investment of a packet top or a magazine purchase. Unless individuals keep in check the amount of time spent on this activity it could lead to a form of addiction similar to gambling,” he says.
One extreme example of this was a frozen food on-pack promotion with a unique code that had to be entered on-line in order for a chance to win regular prizes of £1000. Syndicates of ‘hardcore compers’ were staying up at all hours of the day and entering thousands of codes to gain an advantage over other entrants. The team at PromoVeritas investigated several prize winners and was amazed to discover the amount of money that they had ‘invested’ purchasing the brand, their freezers were full of the promotion product and they were incredibly inventive at getting rid of the stuff – to old people’s homes, on street corners and elsewhere! But with several ‘hardcore compers’ winning £10,000 plus it may have been a shrewd investment.
“The key to preventing high profile promotional disasters is to ensure that they comply with the ASA regulations, have solid terms and conditions and have been tested by experts for ‘break points’ and process issues,” concludes Stern.
PromoVeritas provide a free and confidential advice line for marketers – 020 3301 7360 – where advice on promotional campaigns is given. Alternatively, PromoVeritas can be contacted on firstname.lastname@example.org