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Raffles Boost Customer Loyalty by Veronica Machado

Raffles Boost Customer Loyalty by Veronica Machado


Over the last few decades customer loyalty programs have emerged as one of the most useful tools for retaining customers and increasing overall sales. Starbucks uses a punch card, Amazon offers Amazon Prime, and Safeway customers can obtain a savings card, but all three have seen significant increases in sales since instituting these programs. Holding a raffle is another effective way of boosting promotional recognition and customer loyalty and retention through the sale of tickets offering the possibility of significant rewards. This essay provides a range of tips and concepts, which will help to assure that your organization’s raffle will succeed in attracting and retaining new customers and promoting the brand.

The core idea of the raffle is that, for a nominal cost, customers can purchase a chance to win something highly desirable, from cash prizes to expensive products, vacations, or other opportunities. Importantly, the raffle must be designed in such a way that brings customers back to the store or website of the company offering the promotion. One way to accomplish this is through a group event at which the winner or winners of the raffle is/are announced. This event should take place at the physical store location, or live via video on the organization’s website. This strategy ensures that raffle participants will return to the sales location to find out if they have won the contest, making it more likely that they will make purchases or browse products. A bonus tip is to schedule sales and other promotions to coincide with the date of the raffle drawing, further enticing customers to shop and make purchases. Once the winner is announced, the other customers can be rewarded with a ten percent off sale on all items for that day only, thus providing some value even for those who did not win.

If promotion and customer loyalty are the goals of the raffle, businesses should avoid the temptation of using the raffle as its own source of significant profit. Raffles can raise a good deal of money, but repeat customers and increased brand exposure are much more valuable in the long-run. Therefore, while high raffle ticket prices and huge prizes may attract high-rollers and people who are not risk-averse, these will be relatively few in number, and will likely be more interested in the flashy prize than in shopping at your establishment. Instead, design your raffle so that it maximizes participation by the largest number of potential customers, and delivers only a modest profit. Participants will be attracted to low-price tickets offering modest rewards like $100 gift cards or items of similar value and universal usefulness. This way, the drawing will attract large crowds of potential customers, rather than an eager few. Online calculators offer an easy way to calculate the price and total number of tickets to sell in such a way that subtracts the value of the prize or prizes to reveal the profits from the promotion. As stated above, it is wise to keep ticket prices (and thus profits) low, so as to maximize the number of participants who may become your next loyal customers.

Finally, brand exposure and customer retention can be maximized by requiring customers to provide contact information as part of the raffle sign-up process. In this way, customers will voluntarily provide valuable information which can later be used for targeted advertising and marketing campaigns. If there are multiple prizes to choose from, this sign-up process can also provide important preference information about what items are most in demand by the people who shop at your location. Used correctly, the raffle can be a valuable tool for promotion and for building the loyalty of your customers.


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Contributed by Veronica Mercedes Machado

September 7, 2015