Few things can be more satisfying for a brand owner than the clever sales promotion that stealthily captures its customers’ imagination. At a minimum of cost, compared with above-the-line advertising, and with a maximum of leverage – not to mention some useful accountability – it brings punters flocking again and again to the retail counters.
By contrast, there is no experience more awful than the odd – there only needs to be one in a company’s history – sales promotion that badly miscarries. Instead of a modest place in the professional hall of fame, it brings a sudden and highly damaging notoriety to managers and brand alike, which is supremely difficult to eradicate.
McDonald’s marketing executives will be keenly familiar with both these states of mind. For over a decade, the burger chain had been working quietly but effectively with Simon Marketing, a US sales promotion specialist, on a series of successful lottery-style games, principally ones based on Monopoly and Who Wants To Be A Millionaire? What McDonald’s didn’t know was that for much of that time, a Simon director – who has now been arrested – was allegedly diverting the prize money through a network of “winners” he had recruited and primed. Almost needless to say, this is a huge embarrassment for McDonald’s, while for Simon it has been devastating. The sales promotion consultancy was immediately fired not only from its top account, but lost a multi-million dollar business deal with Philip Morris.
What’s most surprising about these fiascos is not so much that they occur, but the capricious results they have on company reputation. As it happens, most companies (but not necessarily promotions consultancies) manage to shrug off disaster. The over-enthusiastic Cadbury golden egg episode was certainly embarrassing, but resulted in no lasting harm even for its consultancy Triangle, which many continue to regard as among the best in the business. Likewise Asda, with an expensive TV games promotion that featured see-through scratchcards. KLP, the consultancy, paid a price, but one it could live with. Hoover was very different, but then – as promotions professionals never tire of pointing out – the company deserved everything it got (including being sold off) because it didn’t employ experts.
McDonald’s is likely to emerge bruised and looking a little foolish, but essentially unharmed. It did, after all, employ professionals, and because it was the victim of fraud, may well engender a little sympathy for its situation. Then, too, it has been swift to acknowledge the problem and implement a crisis management plan – involving a fresh set of games that punters can actually win. Set against this, the fact that McDonald’s is only now introducing sophisticated security procedures to combat such fraud raises questions about a disturbing lack of vigilance in the past. Worse, McDonald’s has failed to apologise for the incident. It’s a little reminiscent of former Coca-Cola chief executive Doug Ivester failing to take the Belgian contamination scandal seriously enough. And almost as if McDonald’s believes it was the company that has been robbed, rather than the many customers who have passed through its doors over the years.