Have you ever scrolled on social media and come across a post about an online contest or a big brand giveaway for a lucky winner? Maybe your favorite brand is running a competition where the winners get a huge voucher, hamper, or other amazing prizes. Contests have become such a common part of the internet that many netizens are yet to notice the shift from simple giveaways to a much larger, lucrative business. Let’s take a closer look at just how big online contests have become recently.
The Big Money Behind Online Contests
As of 2024, online contests were valued at a whopping $6.25 billion, with giveaways having an estimated 34% conversion rate (higher than other content types). Based on these numbers, experts predict a growth of up to 6% each year, with the total value expected to double in the next ten years. Naturally, these statistics beg the question of why this sector has grown so large and what appeals to customers. For one, this is an excellent way for many businesses to connect with customers and increase engagement and retention rates.
For instance, when you explore BestCompetitions.com, and similar sites, you will find an array of contests for netizens to participate in. This website architecture is a business opportunity in and of itself, which can drive web traffic alongside revenue generation.
Why Are Contests So Popular?
Anyone can probably find a contest on large social media platforms such as Instagram, TikTok, and Facebook. This, in part, explains why online contests and giveaways have become so huge. You may have noticed a trend wherein these social media-based competitions require users to share and tag other users to gain entry. Such an action is a strategic way for businesses (and competition sponsors) to spread the word, and in turn, see a significant increase in their engagement.
Companies also grow immensely when running contests, with their account followers skyrocketing by 70% and landing page contests increasing email leads by 700%. Another tactic is the ‘real people, real content’ approach, wherein these competitions encourage (but mostly require) participants to create videos or post images. Not only does this provide the brand running the contest with free marketing, but it also makes it feel more real to other customers. Even more, competitions excite customers, create a memorable brand image, and save money on marketing.
How Companies Use Contests
Beyond marketing, let’s explore how companies benefit from these competitions and giveaways. For one, contests are an excellent way for brands to collect customer email addresses, allowing for a broader target audience with email marketing campaigns. Some companies use these contests as an opportunity to find out pertinent information about their target audience. A good example of this may be how many competitions have users answer a series of questions centered around the brand and products. From this information, companies can take away what their customers like about the brand and what they dislike, and they can then personalize their offerings. Companies may opt to host competitions in partnership with another brand, which is a great way to share their respective audiences.
This can usually be seen with sponsored prizes in a giveaway, and this team-up can reach more potential conversions. Reputation also plays a big role as contests are a creative way for brands to build rapport, loyalty, and trust within a client base. Of course, this is a smart way to advertise a brand as fun, which can help it cut through the noise of a convoluted or in-demand market. There are a number of contest types businesses may opt for, ranging from simple sweepstakes and quizzes to photo competitions and contests linked to real-life events (e.g., Comic Con, film festivals, concerts).
