Cracking the Code on Next-Generation Code Promotions

Marketing history is rich with examples of successful campaigns that have made effective use of code promotions. These campaigns owe a debt of gratitude to Leon Battista Alberti, the Renaissance cryptographer (and painter, poet, architect) who invented the cipher disk.

A cipher disk is a small device with two circular alphabetic scales. It looks like a toy. And indeed, Alberti’s invention served as the basis for the “secret decoder” premiums that were often included in breakfast cereals and snack foods, beginning in the 1930s. A famous example is to Ovaltine. In exchange for proofs of purchase, the makers of Ovaltine gave the premiums to kids who would then use them to decipher encoded messages that aired on the “Little Orphan Annie” radio show.

Code promotions continued to flourish over the next decades as both the means (codes for getting prizes) and the end (decoders as prizes) for driving increased product consumption. But now things have changed. As Stuart Elliott of “The New York Times” noted last month in his advertising column, consumers seeking to redeem codes are no longer required to go to the post office, call toll-free telephone numbers, or visit stores. “Rather,” he writes, “they can go online to dedicated Websites where codes are processed far faster than before.”

Of course, this phenomenon has been gathering steam since the late ‘90s, when direct mail pieces with Web-enabled decoder cards, as well as merchandise imprinted with codes specifically designed for online tracking and verification, first appeared on the scene. Nowadays offline-to-online code promotions are commonplace, especially is the world of consumer packaged goods, where manufacturers selling through retailers and other reseller channels have long been challenged to establish relationships directly with their end users.

Dog food, candy bars, and soda
One current code promotion involves a music download card/VIP code, good for five free music downloads, which can be found in 75,000 specially marked 50-lb. bags of Purina Dog Chow sold only at Target stores. And next month, the Hershey Co. will “wrap up” its WrapperCash code promotion, a rewards program in which consumers accumulate points and then bid on merchandise in an online auction hosted by eBay, which also provides the customer data management and point-tracking system.

Stuart Elliott rightly notes that dedicated Websites such as DogChowTunes and WrapperCash enable marketers to expose consumers “to additional promotions, ads, and offers, as well as collect e-mail addresses and demographic information.” In fact, the advent of specialized technologies and analytic capabilities now enable innovative marketers to use these Websites to collect far more than just e-mail addresses and demographic information from their consumers.

The Coca-Cola Co. and its My Coke Rewards program provides perhaps the most sophisticated example of how brands can use code promotions to capture behavioral and psychographic information about consumers. The Website was developed as part of Coke’s consumer-centric vision of “connect, collect, and perfect.” Simply put, Coke aims to connect with consumers, collect relevant information from consumers, and finally, perfect those relationships over time.

Launched six months ago, My Coke Rewards currently has more than 3 million registered users who together have claimed more than 750,000 prizes from the program’s 30 participating partners, which include Delta, Blockbuster, and Sony. Approximately 10% of the codes have been entered via a mobile device. In the first two months alone, consumers entered more than 6 million codes, which represents a 40% increase over any previous under-the-cap code program at Coke.

The secret of My Coke Rewards
The My Coke Rewards Website is powered by a technology platform that’s built upon a business rules management solution. The platform automates the decisioning process in terms of which consumers see what content—and when. A dynamic survey engine captures relevant pieces of information at various iterations and through multiple touch points. At the same time, an analytics application rates consumers on their different passions, from sports gaming to the great outdoors, assigning scores to segment them into the most appropriate buckets.

In turn, the program interface displays different page views with dynamically generated content tailored to consumers’ individual passions. Also determining what content gets served up are their product preferences, their consumption behavior, their geographic location, their demographic characteristics, and a vast array of other considerations derived from various sources of data input.

“It’s more than just a technology platform,” said Doug Rollins, Coke’s director of interactive marketing, speaking this summer at Fair Isaac’s InterACT conference. “It’s an asset that establishes an ongoing, two-way dialogue with consumers.”

Collecting the right consumer information in order to automatically deliver the right promotions and rewards—even modifying the look and feel of the Website to match the consumer’s inferred sensibilities—is complicated. Fortunately some smart companies are beginning to crack the coke on next-generation code promotions, and without the help of Alberti’s cipher disk.

Jeff Zabin is coauthor of "Precision Marketing" (Wiley, 2004) and a director in the Precision Marketing Group at Fair Isaac, a leading provider of marketing decision management solutions. He blogs at http://www.paretorules.com/ and can be reached at [email protected]