The power of consumer promotions in 2024

The total value of prizes from consumer raffle promotions carried out by Romanian companies in 2023 was approximately 10 million euros, according to estimates by Mediapost Hit Mail, the largest company organising consumer promotions in Romania. The total amount of last year’s promotional campaigns was about 25% higher than 2022’s.

By Romanita Oprea

Mediapost Hit Mail has been managing at least a quarter of all consumer sweepstakes promotions in the country for about 20 years.

“In a new extensive analysis of promotional sweepstakes campaigns run through our company, this time in 2022 and 2023, we looked, among other things, at prize categories, consumer appetite for contests by age and gender, and the seasonality of these promotional campaigns. This way, we got a clearer picture of the main success factors of such campaigns,” said Marian Seitan, the General Director of Mediapost Hit Mail.

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In 2023, vouchers continued to dominate as a key prize category. Whereas in 2022 vouchers represented around 44% of the prizes offered by companies, in 2023 their share rose to 47%.

At a considerable distance in terms of award categories in 2023 were cosmetics (10%) and electronic products (just under 10%). In 2022, products from the home and garden (10%) and cosmetics (8%) categories were second and third among the most common awards.

One-bedroom and studio apartments, cash prizes, cars, holiday vouchers, and exotic trips were among the most expensive prizes won last year by Romanians who participated in raffle promotions. 29% of the total value of the prizes in campaigns organised by Mediapost Hit Mail in 2023 was recorded in May, which had the highest share of the year. The timing followed the dynamics of 2022, when the value of the awards in May accounted for 19% of the annual amount.

In fact, prize money has increased every month in 2023 compared to 2022, even in December, which saw the lowest amount of the year. Consumer promotion participants aged 18-39 won 44% of the total prize value in 2023, although their share of total winners was only 35%.

The 40-55-year-old generation won 34% of the total prize value, accounting for 33% of the winners, while over 55 winners only won 22% of the total prize value, although they accounted for 32% of all winners. These weights changed very little in 2023 compared to 2022.

According to the report, in 2023, around 55% of winners of promotional lottery prizes were women, up slightly from 2022, when they represented more than 53% of winners.

The 2023 MHM Promo Report took into account promotional campaigns by drawing lots held in 2022 and 2023 at the national level. The study covered the retail, food & beverage, DIY, fuel distribution, fashion, beauty, and tourism industries.

Mediapost Hit Mail SA, the largest integrator of direct marketing services in Romania, is fully owned by French Post. The company has been operating on the local market for 26 years and in 2023 had a turnover of 60 million euros and over 500 employees, across its 8 branches in Romania and 2 in Bulgaria. Mediapost Hit Mail offers integrated logistics solutions for consumer promotions and e-commerce, solutions for loyalty clubs, as well as multi-channel communication solutions (SMS, WhatsApp, email, call centre), marketing databases, geomarketing, marketing automation, and digital vouchers.

Ioana Manescu, digital marketing manager at MTH Digital, says that most shoppers are already used to seeing discounts during holiday seasons in physical stores and online. Consumers are looking for gifts for their loved ones and new decorations for their homes or seeking to take advantage of the discounts brands are featuring this month ahead of the Easter holiday.

Discount campaigns in online store can be thought of as specific price cuts on certain product categories, stock liquidations, discount coupons that can only be activated on certain orders (e.g., those with a set minimum value, those placed within a certain time interval, etc.).

According to NielsenIQ, the FMCG market in Romania grew by 10% in Q4 2023 and by 15% throughout the whole of last year, with the macro-categories with the most significant growth being non-alcoholic beverages and household or personal care products. These two industries changed their promotional strategies in the last quarter of the year, both moving to more aggressive promotion compared to the same period of the previous year.

Alcoholic beverages promoted on average 5% more than in Q4’22, while personal care and home products did so by 3% more. Even though the promotional efforts for these two categories were significant, the effectiveness of the offers decreased in Q4 2023 for all macro-categories, meaning the promotions brought less incrementality than in the past.

The channels with the most significant increase in value in Q4 2023 were minimarket stores and discounters, the latter already representing 20% ​​of the total value of the FMCG market in Romania, confirming Romanian consumers’ tendency to keep their expenses under control by searching for shops with the lowest prices. Another strategy that Romanians have frequently resorted to in recent years has been to purchase own brand products from retailers, something that maintained their market share at 18.3% in total for 2023, a constant level compared to the previous year due to significant price increases to these products. In the rest of the world, private labels saw smaller increases in value than they had in previous years, with the global average at 12.7%.

Consumers in Romania, just as those in other countries, are moving more fluidly between retail channels in order to satisfy their needs, so in 2024 companies will have to carefully coordinate their online strategies with those in physical stores.

“They should not focus exclusively on immediate growth and carry out excessive promotions, because that could affect their long-term evolution. The balance between profitability and sustainability will be crucial for success in this new year of financial challenges,” say NielsenIQ representatives.

Meanwhile, looking at special occasions such as Women’s Day, a study by Reveal Marketing Research shows that 58% of Romanians state that the brands that entice customers with various promotions and offers to celebrate women’s month are more likely to lead them to purchase their products or services. On the other hand, 37% say that such promotions would not influence their purchase decision, an attitude found especially among men (40% vs 34% women). Furthermore, campaigns and promotions carried out around March 8 tend to have a positive impact on a brand’s image, with 70% of respondents mentioning an improvement of the brand image as a result, to a greater extent in the case of women (76% vs. 65% men) and young people aged between 18-24 (85%).

Livestream Promotions

Platforms like YouTube, TikTok, and Amazon allow brands and influencers to livestream alongside products for real-time engagement. According to Alyssa Ehinger from upstartcommerce.com, retailers can take this further by including exclusive promo codes for livestream viewers. The mix of entertainment, product information, and promotional offers helps convert viewers into buyers.

“E-commerce promotions help retailers capture new customers, boost sales, increase loyalty, and enhance overall marketing strategies. In 2024, retailers should focus their promotions on customer-centric strategies, including the instant gratification of digital rewards, customer acquisition via social media, hyper-personalised marketing with AI, and immersive engagement through livestream promotions. When combined, these strategies help e-commerce businesses maintain success among their competitors, allowing them to capture the attention of modern shoppers and encourage repeat customers,” said Alyssa Ehinger.

Brand initiatives

Kaufland Romania recently announced the launch of its own WhatsApp channel, through which customers will be able to receive information about the latest offers and promotions they can find in stores, delivered straight to their mobile phones.

The initiative is part of the company’s ongoing efforts to improve the shopping experience and communication with customers.

On the WhatsApp channel, customers will have the opportunity to receive the leaflet with weekly offers from their nearest Kaufland store every Sunday. The brochure includes details of discounts on own brand products as well as other available promotions.

To benefit from this service, all customers need to do is register for free on the WhatsApp channel or scan the QR code on the company’s website, send a message with the text “START” in the open conversation, followed by the selection of their city and the address of their favourite Kaufland store. Subscribers will then receive personalised promotions for their chosen location.

“In the digital age, customers need fast and personalised information. With our new WhatsApp channel, we provide them with access to Kaufland’s weekly offers on their mobile phone in the most convenient way possible. This initiative reflects our continuous commitment to innovation and customer satisfaction, as well as to the customer needs and preferences to which we constantly adapt,” said Silviu Buidan, Head of Digital Marketing for Kaufland Romania and the Republic of Moldova.

It is not the first time the company innovates, as Kaufland launched in 2022 its first mobile game in the adventure world Animaterra and in January Kaufland World in Roblox.

Kaufland is among the largest retail companies in Europe, with 1,500 stores in 8 countries, 148,000 employees, and a network of 173 stores in Romania. In 2023, Kaufland Romania received the Best Buy Award certification for the fifth time, which certifies that it is the store chain with the best quality-price ratio on the local market. Kaufland also holds the Customers’ Friend distinction for the company with the best customer service, awarded by the ICERTIAS International Institute, following a market analysis. Kaufland’s objective is to apply the most innovative technologies in the field of retail, so that customers can enjoy fresh products at the best quality-price ratio, by promoting sustainability and local products.