Free Lunch Promo Is A Recipe For Revenue

Using contests to stimulate sales is such an old idea, it’s hard to tell who’s more bored by them:  consumers or the businesses involved with the promotion.

But KXXV Waco, Texas, has breathed new life into the concept with its novel “Free Lunch Friday,” which uses direct text marketing to link contestants to eight restaurants that are participating on a rotating basis and give away, well, free lunches.

Here’s how it works: For a week, viewers in Waco watching the ABC affiliate, its Telemundo sister station or its 24-hour weather channel see promos for a “Free Lunch Friday” opportunity.

To enter, the viewer texts “25lunch” to a “short code” number, 35350. That sends the entry to the station’s owner, Drewry Broadcasting Group, which picks a winner every Friday morning by 9 o’clock. The winner gets the good news via text about the free lunch from whichever of the restaurants is being featured that week. Everybody else who entered gets a 25% discount.

“Our text says something like, ‘You didn’t win, but just show the phone text message as your certificate for a 25% discount,’ ” says Jeff Armstrong, KXXV general sales manager and a 21-year TV veteran who says viewers like the simplicity of it, particularly that “you don’t have to show any coupons.”

The simple logic of the contest goes like this: Hardly anybody eats alone at a sit-down restaurant. So while the winner eats for free and the also-rans eat on the cheap, the restaurant gets the full price from the contestants’ work mates joining in. And it is ‘found’ business. Without the promotion, it’s doubtful that lunch group would have chosen the restaurant featured on KXXV, and it’s not likely that the restaurant would advertise on the station.

Armstrong knew he was on to something almost from the start. After he talked it up with his sales staff, he recalls, “I left to get a cup of coffee and I came back 20 minutes later and we already had deals with all eight restaurants.” He knows what quick sales like that usually mean. “So yeah, I left money on the table,” he acknowledges. “But that’s better than thinking, ‘This is such a great idea!’ and then you price it so high you can’t get anybody interested.”

“We’re probably getting two new tables a day,” says Clinton Harwell, the owner of an upscale Italian restaurant, Pignetti’s, and a newer Mexican eatery, En Fuego, both of which are part of the promotion and have signed on at the higher rate for next year. “Restaurants are sometimes a ‘top of mind’ decision,” he says. The contest just tips the decision-making process, and then, it’s up to the restaurant to make them satisfied customers.

KXXV, in the nation’s 89th-largest market, will haul in an extra $35,000 this year from the promotion, and Armstrong has budgeted $90,000 next year. Armstrong also thinks direct text marketing can be expanded to other business segments — from auto repair shops to clothing stores. He’ll be keeping an eye on what other stations are doing with his idea nationwide.

Every week, KXXV processes as many as 450 entries and Armstrong notes that at least half the time the Free Lunch winner never cashes in. So the promotion really lives off the larger group of contest losers who just get the discount. Waiters who see a contestant’s 25% off text message are supposed to ask them to erase it. But Harwell says he’ll give the 25% price reduction even if they come back again.  He likes the business.

Armstrong came up with the free lunch scheme for the National Association of Broadcasters annual Small Market Television Exchange that was held in Scottsdale, Ariz., last month. Broadcasters go to the conference to talk about new sales strategies, and the group — about 400 this year — votes for the best new idea. “Free Lunch Friday” didn’t win, but while drifting around the hotel and talking to other station account execs there, I found that KXXV’s promo was plenty buzz-worthy.

Armstrong says he’s talked to executives from Barrington Broadcasting (with 21 stations) and Raycom (with 46) who want to cook up their own contests. He’s flattered, of course. Imitation is the sincerest form of thievery, and Armstrong has exchanged lots of e-mails with sales managers elsewhere who want tips. He’s willing to share, and after all, that’s the idea of the NAB conference in the first place.

One caution: Armstrong thinks diners have a short list of sit-down restaurants they’re comfortable with. They need a significant discount, or else they won’t be interested. And restaurants that are too new might not be able to penetrate “the real estate of their mind.”

Another important tip is to get an inexpensive short code provider for the text calls. Those services can be pricy enough to kill the momentum going forward; Armstrong lucked out and found a business in Waco that gave him a great deal by sharing the number. That’s why contestants text to 35350 rather than a number that is related to his station’s channel number.

And, finally, Armstrong confesses his “Free Lunch Friday” is the result of what he likes to call swag, for “sophisticated wild ass guess.” It wasn’t based on market research, focus groups or even a gun to his head. The best thing is, it works.

Market Share by P.J. Bednarski, all about TV sales and TV sales people, appears every other week in TVNewsCheck. Bednarski is longtime TV reporter and a former top editor at TV Week and B&C. If you have comments on this column or ideas for future ones, contact him at [email protected].

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