Free Food Contests Pay Off for Chains

Advertising exposure trumps paltry cost of gift certificates
By Harry Kimball,  Newser Staff
Posted Mar 17, 2010 12:47 PM CDT
The line for the free grand slam breakfast promotion stretches outside the restaurant at a Denny's in northeast Washington.   (AP Photo)
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(Newser) – That year’s worth of free food you just got from a Denny’s or Chick-Fil-A promotion isn’t hurting the chains a bit—in fact, it’s the most effective advertising they do. For one, you don’t actually get a year’s worth. It’s usually just a few hundred dollars, and consumers are likely to bring in their friends as they polish it off. And once the gift card is gone, the stores figure your hunger for fast food remains.

A chain celebrating an opening with a free-food giveaway might spend $30,000 on the gimmick, which is great bang for the advertising buck. Most promotions these days go through the Internet, which allows chains to compile marketing lists and bombard you later with news of the next big sandwich. For example, 600,000 people signed up for Denny’s Grand Slam contest, the Wall Street Journal reports, and 450,000 of them opted to join the company's email list. It’s “the best way to advertise,” says one exec.

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