How can you generate quick growth for your small business? Increasing your sales and leads can be a time-consuming process, but it doesn’t have to take ages to achieve the results you crave. In reality, you can improve your sales numbers, social proof and the return on your marketing investment in a surprisingly short amount of time with the help of an old-school tactic: contests and giveaways.
From Publisher’s Clearinghouse giveaways to lotteries, contests and sweepstakes have been able to generate media attention and revenue for quite some time. Small businesses don’t need to give away wads of cash to take advantage of this marketing method, either. With an exciting prize, viral contest marketing can help any company build their community, generate leads, and collect valuable data that will lead to immediate and lasting growth.
But what is it that makes viral contest marketing so effective? Much of it lies in the psychological elements associated with any contest or competition. By tapping into these underlying traits, contest marketers can generate true excitement for their brand and enjoy rapid growth. Here’s a closer look at some of the psychology behind why contests can be so effective.
1) Urgency and Scarcity
The best contests typically share two key traits that send participants into a frenzy: urgency and scarcity. Urgency can be an especially powerful motivating factor, as it fulfills our desire for instant gratification. This is why most contests and other marketing promotions will typically run for a limited period (often a month or less). If someone knows they could win a free prize or get some other benefit a week from today, they’ll be much more highly motivated to enter the contest than if they have a whole year to participate.
Of course, not everyone can be a winner. Yet this scarcity is actually another essential motivator. Jonny Videl, whose aptly named company, Viral Contest Marketing, specializes in contest marketing, explains, “In some respects, contests are all about supply and demand. Limited supply will always increase demand. If there’s only one grand prize available, it instantly becomes more valuable in the mind of the customer. This scarcity, especially when combined with a limited timeframe to enter the contest, makes the prize highly desirable.”
2) The Power of Free Stuff
Few things are better than getting something for nothing, and this is one of the key factors that makes contests so successful. When something that is normally rather expensive (like a workout program) is given away for free, it builds off the perception of urgency and scarcity to further build interest. It increases the perceived value of the contest itself, motivating a greater number of people to participate.
The psychology behind getting a free prize can even play a role when the monetary value of the prize is relatively small. A 2012 study found “that coupon recipients who got a $10 voucher experienced a 38 percent rise in oxytocin levels and were 11 percent happier than those who did no receive a coupon.” Quite simply, receiving something for free makes us happy — a psychological element that plays a big role in why so many people love participating in contests.
3) Social Comparison
Finally, much of the virality of contest marketing can be associated with what has sometimes been dubbed as our “obsession with winning.” This ties in with the social comparison theory, which Psychology Today explains “states that we determine our own social and personal worth based on how we stack up against others.”
While this winner-take-all mentality can sometimes have a negative effect on society, there’s no denying that it also has a direct impact on the popularity of contests. Winning a contest — especially one where point accumulation or skill is involved — can help participants feel better about themselves, which can be the most powerful motivating factor of all.
“Look for ways to make your contest appear truly competitive,” Videl advises. “Even small things like ranking participants or offering different ways for contestants to earn points will increase their desire to continually engage with your contest. This is why you see so many contests let participants earn points or additional entries for sharing something about the brand on Facebook or Twitter — it’s an easy way to make your contest go viral.”
4) Aiming for the Prize
With viral contest marketing, you can quickly build targeted customer lists and grow your social media audience at a much lower cost than other marketing methods. Better yet, by getting your audience to actively share your content as part of the contest, you’ll get free marketing that further spreads awareness for your brand. As you use the psychological principles behind contests and competitions, you’ll see faster growth — and a greater return on investment — than ever before.