How news media companies can grow revenue through promotions

By Shelley Seale

INMA

Austin, TX, United States

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Advertisers are forecast to spend more than US$309 billion on promotions by the end of this year. Capitalising on that trend, GateHouse Media has grown revenue by more than 10x in just three years using promotions. 

On October 23, an INMA Webinar delved into how media organisations can grow revenue and engagement through promotions as well. The Webinar was presented by Rebecca Capparelli, vice president of promotions at GateHouse Media.

“We saw such a huge opportunity with promotions that we opened a dedicated division for promotions at GateHouse Media,” Capparelli said. “We did that to serve our markets, to help them with strategy, to help them with execution, to help them with marketing collateral really from top to bottom.”

An INMA Webinar with GateHouse Media looked at the value of promotions.
An INMA Webinar with GateHouse Media looked at the value of promotions.

What are promotions?

“Promotions are really a great way to help advertisers grow marketing and sales leads through contesting,” Capparelli said. This can be in form of sweepstakes, quizzes, photo contests, readers choice balloting, and recognition programmes.

GateHouse opened its promotions division after seeing the great forecasts from Borrell Associates. “By the end of this year, US$309 billion are forecasted to be spent by local advertisers on promotions.”

The reason behind this, Capparelli continued, is that today’s advertisers want measurable results: “Promotions are a great way to not only build engagement with a brand but, more importantly, to generate marketing and sales leads.”

Promotions are forecast to represent a massive market opportunity and revenue.
Promotions are forecast to represent a massive market opportunity and revenue.

Why promotions?

Promotions are valuable because they deliver what advertisers want:

  • Engagement of target audiences.
  • Data collection.
  • Increased traffic to Web sites.
  • Increased social media following.
  • Increased e-mail and mobile databases.
  • Generation of sales leads.
  • Increased foot traffic.
There are many great reasons to incorporate promotions into a media brand and advertising offerings.
There are many great reasons to incorporate promotions into a media brand and advertising offerings.

The six proven channels of revenue growth with promotions are:

  • Best of the best awards, which leverages growth opportunities.
  • Community enterprise, which offers multi-month impact with school year and full year programmes.
  • National promotions and national sports promotions.
  • Increasing special section and local event revenue with promotions.
  • Seasonal promotions, which offer more than 400 opportunities throughout the year.
  • Custom advertiser promotions.

Capparelli then led Webinar attendees through each of these opportunities.

Community choice awards, or “best of the best”

“We partnered with GateHouse Live,” Capparelli said. “We work with them to help monetise and build engagement with every step of the programme. The programme starts with voting and ends with a really wonderful gala recognising the very best of the businesses in the communities we operate in. From the very first year of our promotions department this was one of our big focuses because we saw the opportunity to grow revenue and data at the same time with the participation from our community.”

A separate INMA Webinar with GateHouse Live looked at these events in greater detail.

The GateHouse model for this programme incorporates several stages for revenue growth and market engagement:

  • Nomination packages.
  • Voting ballot.
  • Event and special section.
  • Reward packages.

“The programme is sales engineered so there’s no cold calling for sales reps,” Capparelli said. “Every single stage is a defined lead list with really strong media packages to help the advertisers get great results. We provide the best with reward packages at the end so they can share their success.”

Example of revenue results

While many large markets run “best of the best” promotions, Capparelli shared the results of a small market in the Webinar. She used the “Best of Texoma” promotion, with a circulation of 13,000. This promotion grew from US$150,000 in revenue in 2016 to more than US$400,000 revenue in 2019.

“More importantly than just the revenue, is it creates fabulous engagement within the businesses in the community,” she added.

Community enterprise: multi-month promotions

These promotions offer great community engagement and consist of initiatives such as teacher programmes or athlete of the week. Again sharing the results of a small market in Holland, Michigan, with its “Amazing Teachers” promotion, Capparelli said it brought in US$50,000 in revenue. Another small market in North Carolina generates US$56,000 with its “Fan Favourites” athlete-of-the-week promotion, sponsored by one grocery store.

National promotions and national sports promotions

“National promotions ... come with great marquis prizes to help accelerate the marketing and sales leads, the number of entries, that someone gets when they invest in the programme,” Capparelli explained. For example, a “Home Free” programme that gives away a year’s worth of mortgage payments.

As an example to see the kinds of results that are generated, she used the “Blockbuster Bucket” promotion from one company, which had over 1,300 entries. But the most important return was that the entry form asked if the person would be interested in a free home winterisation evaluation — 47 homeowners responded yes, which generated more than US$50,000 in sales for the advertiser’s home improvement services.

Packaging with events

How can you package events for things you already do today and generate more sales revenue with the same efforts? Packing promotions with events does this, increasing the value proposition for advertisers and generates more revenue with the same sales efforts.

This generates email, mobile, and social lists, as well as help sell tickets to the event.

Packaging with special sections

“Many of us today sell special sections, but adding another engagement element with digital and contesting and being able to generate the marketing and sales leads for those customers,” is a win-win situation, Capparelli said. Promotions offer an easy, turnkey way to package special sections to increase reach.

Custom advertiser promotions

Customer advertiser promotions are promotions designed for a single advertiser, with a goal for them to target their marketing leads. These are the fastest-growing section, Capparelli said.

As an example of how this works, she told the story of HyVee grocery store in Illinois. The store told the sales rep it was going to stop all advertising to focus on e-mail, social marketing, and opting people in to its shopper’s club. Hearing all of those goals, sales team members realised that was something they could help HyVee with.

In the end, their proposal to HyVee entailed using a two-minute shopping spree giveaway to increase enrolment into their rewards programme and customer reach through social and mobile.

While HyVee expected to have growth in the areas of e-mail, social, and the shoppers club, they were surprised by how much PR they got from the promotion. “I call this the halo effect,” Capparelli said. The shopping spree was covered by local TV stations, and afterwards HyVee was able to use the video on its Web site, YouTube, and social media for further promotion.

“Custom advertiser promotions are tailored to the goals of your customer,” Capparelli said.

Another example was a YMCA that was looking to grow membership. Through its promotion it had an 84% email opt-in rate, which they were very happy about. But the programme also positively impacted other profit centres such as back to school photos, Kids Expo, and other initiatives.

“So you can build a nice series of custom advertising promotions for any client,” Capparelli said.

Seasonal promotions

There’s also a very strong way to take seasonal promotions to advertisers. These can be for folks during the holiday and advertising category.

“We found it was a little clunky for sales reps to communicate the value proposition,” Capparelli said of her team’s efforts as they started with promotions. “So we put together a real strategy on how we could help them communicate the value proposition and generate more sales and also more results for our advertisers.”

One of the fundamentals for doing that was to leverage training. “We do training for all of our new staff as they come in, we have leadership and sales based training,” Capparelli said. “We want to make the value proposition super easy; we want to make sure that they can articulate that it’s all about marketing and sales leads. But doing it in a way that’s very customer centric. So we train them to ask questions.”

Sales staff training on how to effectively market promotions is vital.
Sales staff training on how to effectively market promotions is vital.

These questions include:

  • How do you develop marketing and sales leads for your profit centres?
  • How important are marketing leads in the areas of e-mail, social, and mobile marketing?
  • How do you generate sales leads?
  • Would you like more sales leads?

What advertisers want and how promotions can deliver

Many people think when first hearing about promotions that it’s just a logo on a contest. But the real reason advertisers would want to invest in such a promotion as a “cutest baby” contest is to reach those potential family customers.

Many of the fundamental things that advertisers want are available through a promotions strategy.
Many of the fundamental things that advertisers want are available through a promotions strategy.

Advertisers want to:

  • Engage their target audience.
  • Collect data.
  • Increase traffic to Web site.
  • Increase social following.
  • Increase email and mobile databases.
  • Generate sales leads.
  • Increase foot traffic.

GateHouse uses proposal templates that can be generated for each advertising customer and customised. Capparelli suggests always including case studies. “They want to see the kinds of great results you’ve been able to generate for other folks.”

Using case studies in proposals to advertisers is essential to showing them the possibilities.
Using case studies in proposals to advertisers is essential to showing them the possibilities.

They also have a pricing calculator that can be used to calculate and show an advertising customer the revenue they can expect to generate from the promotion.

Best practices and building packages

Part of telling the story is building packages and having programmes that work. GateHouse would hear from people who said they ran a promotion and it didn’t work. This is because they didn’t build their promotion around the three pillars:

  • Have a media plan designed to reach the target audience, whether that’s newspaper, social, e-mail, etc.
  • Have a low barrier of entry, making it easy for people to enter. People think they have to be creative, but really making it easy is the most important thing. Sweepstakes are often the best in this way.
  • The prize should be good. This is where to be creative. Give away the client product to drive relevant leads. Giving away cash will get a lot of tire kickers. Make the prize as awesome as possible.

You must demonstrate the value of the programme and its reach by showing the media plan for all aspects of the promotion.

Building your annual plan

How do you build a plan for your market that can help you maximise your opportunities?

Building a strong annual plan around promotions is a good practice.
Building a strong annual plan around promotions is a good practice.

Capparelli suggests having one dedicated staff person, a promotion manager, to take the lead on this. They are instrumental to help launch the promotions with the sales team. Having a person to take the lead and be rewarded for it is an important building block.

“We not only use promotions to help our advertisers achieve goals but also to achieve our own internal goals,” she added.

For example, the news media companys marketing division runs promotions every year. Each one has generated more than 1,000 leads for the GateHouse sales team. “We also work with our consumer marketing group designed to generate single copy sales.”

Aligning resources to accomplish your growth goals

GateHouse aligns its compensation with these promotions across the company through commissions, which also count towards all of the sales goals.

“If you’re going to pick one spot to get started, I recommend the best of the best programme,” Capparelli said.

And lastly, sales training is a paramount piece for success.

Q&A

INMA: What’s a typical set up with your team and where do they fit in the organisation?

Capparelli: There are multiple things you can accomplish. Our strategy is revenue first. For us, in each market we want to have a sales lead for promotions. They do not need to know how to do any set up in our platform, they just sell it and provide us with the creative brief and we do all that.

INMA: Are prizes supplied by advertisers?

Capparelli: In our case that is the story, the advertisers do provide the prizes. We don’t charge them for any of the creative services; they only pay for the media plan. We do share with them that the better the prize, the better the ROI they invest in the media plan.

INMA: Can you share more about the pricing calculator?

Capparelli: Ours is not super sophisticated; it’s an Excel workbook. It calculates the total reach, total value, and total investment of a proposed promotion. We use it company-wide as a great resource for our sales reps to calculate the true value of the programme.

INMA: What’s the selling window or lead time?

Capparelli: It does vary, and we rush things all the time. Generally speaking we want a week lead time. There are different types of promotions and they have different windows.

INMA: Of the campaign examples viewed, what are the average campaign costs and respective value?

Capparelli: The markets usually tell us the price points that they think will have good conversion for their market. In most cases the value is at least double that when you factor in social reach, which have no cost for us at all.

INMA: What are your typical advertiser goals?

Capparelli: The top goal is always sales leads. The second is growing e-mail, mobile, and social audiences. Those are channels that once the customer grows them, they get to use them over and over again.

About Shelley Seale

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