How to Run a Profitable Social Media Contest

Running a social media contest can be an extremely rewarding experience for your business.A well-executed contest or giveaway has the ability to quickly grow your leads database, explode your brand recognition, and build trust with your prospective customers.But the sheer nature of a contest is to “give something away.” You are offering a prize to the winning participants in exchange for their contact information, referrals, or some other goal you have set for the campaign.

So, how do you run a profitable social media contest if you are giving away free stuff?

Here are some tips to keep in mind.

Choose the right prizes

Choosing the right prize for your contest is a critical step in determining whether or not it will be a profitable exercise.On the one hand, you don’t want to offer a prize that will send you into receivership. However, your prize needs to be attractive enough to entice people to participate.Don’t worry, you don’t need to give away a Maserati to build buzz for your contest. The best contest prizes complement your business and value proposition. For example, if you are a personal trainer you could give away a group of free sessions. Or, if you run an eCommerce store, offer up some of your most popular products.Here is an example of an electric bike company giving away one of their bike models in a contest:

Complementary contest prize example.View and Create Your OwnThe beauty of giving away a prize which aligns with the revenue activities of your business is that anyone who signs up is essentially telling you that they are interested in what you have to sell. So, for all of those that don’t win the prize, you can follow up with them with future sales messages. Closing only a handful of these new leads would likely cover the cost of the prize you gave away - making the contest profitable.Another way to choose a prize for your contest is to partner with a complementary brand and have them provide the prize. For them, they get exposure to a new audience. And for you, the financial outlay for the prize is significantly minimized.See how Deebee’s Organics has partnered with Fatso Peanut Butter in the Instagram contest below:

Contest partnership example.An interesting contest trend I’m seeing at the moment is to have participants contribute to the prize. For example, you could run a design contest where everyone submits a certain design element for a piece of art, the combination of all the winning designs could then be purchased as a product by the winners (and others). By creating a product from your contest which you can resell, it’s profitable by nature.Here is an example of a Pug information site, Ask Pauly, using this tactic to create a coffee table book with photos from contest participants:

Contest powered by user contribution.In addition to the main prize for your contest, you could give away secondary prizes too. By giving away secondary prizes, everyone feels like a winner and leaves them with an appreciation towards your brand.A great example of a secondary prize is a coupon for your product or services. Coupons don’t cost you any money to create and they entice the winners to spend money with your business. Sure, you will reduce your margins if they use the coupon, but considering they may have never been a customer in the first place, the trade-off is worth it.See below an example of a contest run by O’Toole’s Garden Centres which has three prizes, all of which are gift certificates for their store:

Using multiple prizes in a contest.

Encourage sharing

An attractive benefit of social media contests is their natural virality. Basically, they can spread like wildfire without any significant intervention from you because of the desire of participants to share the chance of winning with their friends and families.If you want to reduce the operating cost of your contest and subsequently improve its profitability, actively encouraging sharing and user-generated content (UGC) is critical.Here are a few ways you can entice contest entrants to promote your contest for you:

• Create a unique contest hashtag so that you can collate the social media activity and UGC from the campaign.
• Have entrants comment on your Facebook or Instagram post and tag a friend as a part of the contest entry requirements. Califia Farms uses this tactic in this Instagram contest:

A contest which encourages user commenting on Instagram.

• Give participants an incentive, such as extra contest entries, for sharing the contest with their friends.

If you use these three simple strategies in your contest campaign, you will be able to reduce your advertising spend and improve your organic reach.

Follow up

Without follow up, your social media contest won’t be profitable. It’s as simple as that.You’ve gone to great lengths to collect vital information about your prospective customers - perhaps you’ve even given them a coupon to use with your business. Now, you need to follow up with the contest participants to ensure as many of them as possible take action.Creating a follow-up plan for once your contest is completed will help you make the most of the effort that has gone into the campaign. Try not to think small with your follow-up, this plan could last for months, or even years, if you want it to. For example, here are some ways you can follow up with contest entrants:

• To begin, send them an email which notifies them of whether they have won a prize or not.
• Segment your contest participants based on the data they have provided, whether or not they are a winner, and the type of prize they won. With this information, send them a series of targeted email campaigns in the 10 days following the contest that tries to turn them into a customer.
• Continue nurturing all contest participants with regular email campaigns for as long as they are subscribed to your list.
• Reconnect with contest entrants the next time you run a similar contest to build momentum for the contest in the early stages of promotion.
• Leverage remarketing ads on Facebook and Google to engage with contest participants, who already know who you are, and convert them into customers.

As you can see, the effectiveness of your follow up is a critical indicator of just how profitable your social media contest will be.

Conclusion

Social media contests are an interactive way of expanding the reach of your brand and collecting leads. But making them a profitable exercise is a balancing act.To run a profitable social media contest, it all starts with picking a set of prizes which both align with your business offer and entice people to enter the contest. You then need to tap into the shareability of contests by using hashtags and encouraging referrals. Then, finally, a large portion of your planning time should be dedicated to the contest follow-up so that participants are persuaded to take action.Now you know the tricks of the trade for running a profitable social media contest, what’s holding you back?

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