Andrew Eaton and Dr. Doug Dean, School of Accountancy and Information Systems
Type in the word “FREE” on Yahoo! And you get nearly 10,000 results.
In the rage of “Who Wants To Be A Millionaire?” and popular voyeur reality TV shows with prize money of a million dollars, offering cash and prizes as incentives to visit a Web site is a popular trend among companies trying to compete for attention among hundreds of thousands of consumer sites on the Internet.
In September of last year, two out of every five Web surfers found their way to a sweepstakes related Web site. Everyone wants to get something for nothing. Grab.com gave away $1 billion, and was one of the most visited Web sites. Sweepstakes portal iWon.com consistently ranks in the top 20 most-visited web sites, according to Web metrics firm PC Data. The site awards a monthly $1 million prize as well as an annual $10 million prize. Users receive points as they travel throughout the site.
How times have changed. Last year one could surf the Internet and get a free color printer from Estamps.com, a free scanner from Insight.com and unlimited Internet access from NetZero. Free voice mail, subscriptions to magazines, digital prints. Even a free yellow and black lava lamp from Lavaworld.com. Times have changed.
These days one is hard pressed to find a free digital greeting card on the Internet. However a core group of sweepstakes sites remain with their loyal members. With the dot-com boom, Internet properties tried attracting “eyeballs” to a site by any means possible, the idea being that each viewer represented a certain amount of future advertising and e-commerce revenue. More often than not, that meant giving something away. Sweepstakes became a popular means to attracting Internet traffic.
The crash of technology stocks has prompted Wall Street to demand profitability from Internet ventures. Firms hoping to survive on advertising alone are furiously trying to develop subscription services, and convince their audience that the product is worth paying for. The Internet is shaping up like television, with its free network channels surviving alongside cable subscription services.
Since most sweepstakes and other gaming sites are free, the revenue comes almost exclusively from advertising and the selling of member demographic information. While most of the sites demand users be 18 years old, it seems no one is in doubt who the real target for these sites it: middle-aged-women. The question is thus raised as to how sweepstakes sites will be profitable, long term? They will need to continue to gather information on their users. My research concentrated on what Web site benefits motivate users to provide information about themselves?
To compile data on which benefits were most appealing to consumers I created an online survey with six of the most common responses from a preliminary online poll. This survey was completed by members of several sweepstakes sites and produced the following metrics:
Guarantee that information would not be misused 66%
Winning a prize in a sweepstake 39%
Access to more or better content / information online 33%
Regular e-mail updates on products / services 30%
Affinity points, such as frequent flyer miles 22%
Ability to read target ads 12%
A second online survey measured the effectiveness and popularity of online marketing tactics.
63 percent of respondents report they access the Internet specifically to look for special offers or promotions.
48 percent of respondents said they have logged onto the Internet specifically to participate in a promotion and 46 percent said they spent time “promotion surfing” to find special offers, contests and sweepstakes.
Additionally, nearly two-thirds (62 percent) of respondents said they were “very likely” to purchase a product introduced in a promotion in which they participated, and 53 percent said their promotion participation had a “positive impact” on their view of the brand.
It was rewarding to see this research confirm that well executed and thoughtful Internet-driven promotions and sampling programs are a highly effective tool to drive brand sales and create passionate brand believers. It is also to see the concern of consumers regarding their privacy on the Internet.
In this survey 64 percent of respondents agreed with the statement “I would be willing to provide personal data if there were some compensation.” Almost half of the respondents were involved in promotions on a weekly basis. Overall, consumers are more interested in promotions that help them save or win money (such as free samples, coupons, buy-one-get-one-free deals, win $1,000) than they are in other kinds of offers.
Overall, this was an invaluable industry related research experience for me. I am currently doing an internship for Sun Microsystems in the Enterprise Services Strategy Office. I am planning to return in the fall to the dot-com start-up company in Orem where I fostered my interest in the Internet and technology.