While The Three Lions are a game away from the World Cup final and big companies are celebrating by offering freebies, we dig into the risks they may have if the trophy comes back to Britain
Whether you’re a footie fan or not, the continuous unexpected victories of England in the World Cup this summer have united the country like never before. England flags and chants of “It’s coming home” have been filling up every street nationwide.
So it’s unsurprising that alongside pubs and restaurants, stores have seen a surge in profits too. But many have gone a little overboard to attract business. From a free pint, burger and chips, to even a car, companies are making the most of the game as a marketing strategy. But it begs the question: will they be able to keep up with the promises or will they score an own goal?
Indeed, many business titans have been remarkably quiet when it comes to the second part of a promise – standing by it. For instance, Elon Musk, CEO of Tesla, has shot himself in the foot before. The tech entrepreneur and his teams produced a kid-sized submarine designed to rescue 12 boys stuck in a Thailand cave, which Musk said was ready for action, although Narongsak Osottanakorn, head of the search operation, disagreed that it was suitable.
“Larger companies may be able to absorb this additional cost but a smaller business may not be able to cope as easily with a loss of income,” said Lino Di Lorenzo, principal associate at Mills & Reeve, a corporate law firm.
The World Cup saw some businesses take a gamble by offering special freebies on account of an unlikely event happening but it seems like they didn’t realise the price they would have to pay.
Sarah Burns, managing director of Prizeology, a promotions agency, said: “Any brands running promotions need to plan carefully, understand the regulations and be aware that there are strict rules that must be adhered to in the UK.
“Under the UK regulatory code for promotional marketing, prizes can’t be withheld if they’ve been won. The Advertising Standards Authority will always uphold a complaint if a winner doesn’t receive a promised prize.”
More so, these conditional offers can “result in biding contracts being formed which a consumer can enforce if they are not honoured,” added Di Lorenzo.
Elite Business explored some giveaways that have been offered in the World Cup season by companies who thought that when Gareth Southgate's team score a goal, they too would score new customers – despite these risks.
(1) Three Lions on a shirt
Having an England kit for every die-hard fan is necessary. Hence, Sports Direct, the sporting retailer, has promised to give away free England T-shirts if the cup comes home. The chain will dish out T-shirts via its app for all who register. The concern is whether the firm’s marketing budget will cover this.
(2) England is racing ahead
AutoTrader is giving away a car for every England goal that hits the back of the net and virtually anyone can enter for the chance to win new models from Jeep, Fiat, Alfa Romeo and Abarth. All football fans have to do is use the hashtag #AutoTraderGoals on Twitter or Facebook as soon as England scores to go into the draw. With England setting sights on a semi-final victory over Croatia on Wednesday, July 11, fans will be hoping it will be even more expensive for the firm. We doubt the company estimated the risks before this promise but it hasn’t disappointed the fans so far.
(3) Ale yeah
As the official beer of the FIFA World Cup 2018, Budweiser is pledging to give a free beer for the nation if it turns out football’s coming home to get behind all of the committed supporters. With its current stance after continuous victories, the company might have to be prepared to give away 50 million bottles.
(4) Not shaken or stirred
England reaching the semi-finals calls for another Martini – so says Be At One, the cocktail bar chain. A World Cup initiative called Be At Nini comprises a sticker challenge where you get a free cocktail for buying five. Here’s a good example of a solid defence that plays it safe before giving away too much for free without anything in return.
(5) Supermarket sweep
The supermarkets are gearing up for aisles to be packed before the kickoff. Sainsbury's is giving double nectar points if you shop between Tuesday and Wednesday July 10-11, which will be added to your card if England wins against Croatia. Not just that, it also offers a 25% discount on champagne, wine and sparkling wine bottles if you buy more than six before Sunday July 15. Like Be At One, it shows knowhow in maximising its income in the football season.
It's easy to see how companies view international events such as the World Cup as a hook to drive brand awareness although they should be mindful of the marketing risks. England's success has caused Auto Trader to shell out £180,000 until now and more to come with the subsequent matches.
However, Burns added: "Big brands running a promotion like this, would have a risk management policy in place to ensure that they can still give away prizes without financial loss.”
But SMEs would be wise to tread carefully as the consequences can go beyond bad reputation and backlash on social media. “It could ultimately force that company into an insolvency process if it’s unable to manage all of the liabilities it has to meet,” said Di Lorenzo.
Whether it's unrealistic expectations by the founders or pre-assumed costs involved, the risk should be taken only if worth it and entrepreneurs must have a safety net in case things go south.