Cinnamon Toast Crunch sweepstakes using ePrize services.
TEXT OF STORYSCOTT JAGOW: Surely, you've been surfing on the Web and seen those bright flashing pop-ups that say "Click to Win." It's usually a contest for some kind of shopping spree. We wondered how this works. How a small company can afford to offer sweepstakes. Turns out there's a website called ePrize that provides this service to small businesses — and helps them collect your information in the process. Sean Cole has more.
SEAN COLE: The service is called Caffeine!
ePrize says it's a way of energizing your company's marketing. And if you go to the ePrize website, a very caffeinated woman there will tell you all about it.
PEPPY LADY: Consumers respond to the chance to win plain and simple. But to be really successful you've got to have prizes that make people's eyes pop, prizes that impress. Historically . . .
And with Caffeine the prizes are pooled. That is, customers of a bunch of different businesses all running separate Caffeine promotions on separate websites are vying for the same shopping spree or kitchen makeover.
JOSH LINKNER: And what that does is it allows an advertiser to offer a big, juicy, exciting prize without writing a big, juicy, exciting check.
This is Josh Linkner, the CEO of ePrize. He says the chance to win is tantalizing bait, as evidenced by the entire city of Las Vegas.
LINKNER: And what happens there is people pay with their hard-earned money for the chance to win. In this case it's easier because all they're doing is really paying with their attention and their information.
Because when I register for a Caffeine contest on, say, the website of a local dry cleaner I give my name, e-mail, address . . . I'll put my P.O. Box.
And when I do, the dry cleaner pays ePrize $1. If I login again, ePrize gets another 15 cents. Meantime, that dry cleaner can send me all kinds of coupons and surveys.
PEPPY LADY: It's like buying marketing gold for pennies!
Thank you, peppy lady. The thing is, I can opt not to receive any promotional material. But a surprising number of people say sure, send me stuff. Quality Cleaners in Royal Oak, Michigan, for example, says almost half of the 230 people who entered the contest agreed to be contacted.
But it was clear that some of the entrants just wanted to win a prize. Josh Linkner at ePrize says those people are in the minority.
LINKNER: And so you may get a couple exceptions that come and those that do you know you can opt out and the advertiser doesn't have to waste any time, money or energy on that person.
But Quality Cleaners says that some people who say they want to be contacted really don't. They just think they have a better chance of winning if they say they do.
In Boston, I'm Sean Cole for Marketplace.