Joint Statement

Third-party sales promotions are effective in allowing brands to build on each others’ strengths through association. But if the relationship falters, the repercussions can be serious, says Steve Hemsley

According to one sales promotions agency, arranging third-party promotions is like making love in a hammock: there is always the risk that one person will fall out.

The millennium celebrations provide the ideal opportunity for brands to join forces and achieve maximum exposure. But if a campaign is to run smoothly, and brand managers are to understand what each party expects to achieve from such a close collaboration, it is essential nothing is left to chance at the planning stage.

Many millennium-themed promotions have yet to be unveiled, but a major campaign arranged by Scottish Courage ran from May to September. The company teamed up with Virgin Radio, Capital Radio and numerous brand owners in Australia and mainland Europe for Fostralia 2000 – the biggest beer promotion ever run in Europe.

The winners of the scratchcard pub competition and on-pack games – from 16 European countries – will be flown to Australia to see in the new millennium at a top restaurant in Sydney Harbour.

With so many third parties involved, it took Scottish Courage’s sales promotion agency, Momentum Integrated, 18 months to organise the event. Suitable partners, such as the Australian surfing brand Rip Curl, had to be identified, and then convinced to take part. Once contracts had been signed, the lengthy process began of obtaining the approval of senior management at each company for the mass advertising and point-of-sale (POS) material – adapted for retailers in different countries – aimed at targeting European consumers with the message: “Fostralia 2000 – the party of a lifetime.”

“Scottish Courage will only deal with what it perceives to be quality brands, and the contract for a promotion like this must be very tight. It only takes one weak link in the chain to harm an entire campaign severely,” says Momentum Integrated vice-chairman Ed Downey.

He says Scottish Courage made a £4 return on every £1 invested in this multimillion pound promotion.

The millennium is one of the biggest promotional opportunities that brand managers will encounter, although one-off promotions that bring together more than one brand, such as Fostralia 2000, can be done at any time.

They work best when the timing is perfect for each company involved. A brand owner recognises the benefit of linking up with another that is targeting the same demographic group, although not in direct competition, and this provides access to new consumers through association.

For instance, skincare company Elida Fabergé approached designer clothes label Timberland for a co-promotion centred on Vaseline Intensive Care. Elida Fabergé is spending £5.5m promoting the range and a competition, which began in September and runs through to January, offers a first prize of a trip for two to the US and £2,000 to spend at a Timberland store.

Elida Fabergé category trade manager Gina McKenzie says the competition strapline, “Win yourself a second skin, when you let us take care of you first”, pulls together the synergy between two brands that, in different ways, protect the skin when consumers are involved in outdoor activities such as hiking. “Timberland was one of a number of potential partners we considered working with, and it was pleased to get involved.

“Our research told us that Timberland has a wide appeal among all age groups and is a trusted outdoor clothing brand. It has taken eight months to agree all the details of the campaign and approve the POS material for Timberland stores,” McKenzie says.

However positive the results of any research into the promotion’s effectiveness, it is important the marketing team which made the approach does not forget that the other brand owner will have its own reasons for taking part.

Paul Cartmell, managing partner at sales promotion agency Billington Cartmell, says that once a deal is struck a client’s promotion immediately becomes part of the third-party’s marketing strategy – and they always have their own agenda. “Once we have identified a suitable partner, we spend a lot of time ensuring that brand managers from both sides understand how the promotion will benefit each of them. But negotiations can be difficult, and complex, before the terms are finally agreed,” he says.

Giant partners

Billington Cartmell organised the Carlsberg “Sounds good” campaign involving MTV, HMV and Virgin Radio. In the campaign, which runs until the end of November, consumers receive a £5 discount on CDs at HMV with every six pints of Carlsberg bought in a pub or 12 cans purchased at an off-licence.

Virgin Radio is giving away tickets to an exclusive Carlsberg party on October 23, while MTV has tickets to the MTV Awards – sponsored by Carlsberg – in Dublin on November 11.

Carlsberg senior brand manager Alex Penman says there is an obvious association between beer and music. “It has worked because all three are respected brands in their own right, there is no conflict of interest and all the mutual objectives are being met.”

David Lazarus, managing director at Marketing Hut, says the hardest job for agencies can be convincing clients and third-parties of the value of doing a joint promotion. “When you approach a company, it is initially wary because you are suggesting something that is not part of its marketing plan. No budget has been allocated and it knows it will have to get approval from a higher director level. Even when the opportunity is perfect for the company, it can take a lot of work to get it involved,” he says.

Marketing Hut client Addis Housewares recently tried to stimulate consumer sampling by joining forces with the Glade, Pledge and J-Cloths brands, among others, to create a “Home cleaning kit”. Consumers could send away for it when they bought an Addis Superdry Mop.

Although many cross-brand promotions are one-offs, they can evolve into strategic partnerships. Last autumn, holiday company Going Places launched an in-store offer linked to Tesco’s Clubcard loyalty scheme. Card holders spending more than £200 over an eight-week period were mailed a £50 holiday voucher with their Christmas statement – to be redeemed at Going Places during December and January. The promotion was so successful that in May Going Places became an official Clubcard partner, which means shoppers can now collect points whenever they book a holiday.

Exposure partners

Diana Tombs, managing director of the Black Cat Agency, which represented Going Places, says the promotion worked because it drove Tesco sales, associated her client with the leading supermarket chain and gave it access to the millions of customers who visit Tesco’s stores each week. “Tesco insisted the offer was additional to any existing promotion in Going Places’ shops, and that it included UK holidays so that all Tesco customers could take part. There were also strict controls on POS material,” she says.

It is an example of one brand looking for exposure and identifying another brand that can deliver the audience.

Similarly, PPP Healthcare is advertising on Flora margarine packs until December. This has given it access to millions of homes, while for Flora it reiterates its association with health issues.

Matthew Hooper, managing director of sales promotion agency Interfocus, says such promotions work so long as both marketing teams understand which is the lead brand – it usually belongs to the company which initiated the approach – and egos do not become a problem, especially once contracts have been signed. “Someone must have the final say on media and POS, but there is a risk that problems will occur and people will fall out before, and during, a campaign.”

A client has no control over the corporate decisions made at a third-party company, which might decide to withdraw from a promotion during negotiations because of changes to its internal strategy. In other cases, one party may not fulfil its part of an agreement to the satisfaction of the other brands involved.

Breakdown of relations

Geoff Howe, managing director of Geoff Howe & Associates, who organised a partnership between two of his clients and a third-party oil company for a forecourt promotion for a non-petrol product, says problems arose because his clients were unhappy with the posters created by the oil company’s internal communications team. “By the time the oil company agreed to show us a proof, it was too late and our clients were furious because they did not feel the posters got their message across,” he says.

One way to reduce the risk is for an agency to get two of its own clients to work together. Howe did this with Cadbury’s Cakes and computer games company Electronic Arts, which used cake boxes to promote a new game called Croc 2. “The main advantage here is that you know who the decision makers are at each brand owner and how a potential promotion will fit in with their existing marketing strategies.

“For the agency, it is also more cost-effective because you can often make 50 or more calls trying to find a third party that is will ing to take part in your client’s promotion.”

There is additional pressure on brand owners and agencies to come up with suitable ideas and partners for an important event such as the millennium.

Paul Seligman, managing director of the Communicator agency, which represents the Society of Motor Manufacturers & Traders and helped it to link up with the Automobile Association, National Express and Michelin to promote the recent British International Motor Show, says third-party promotions are up there with divorce and moving house when it comes to stress. “But if you get it right, it is like a good marriage,” he says.


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