Send-a-Friend vs. Contest: Which is More Effective?

Growing your subscription list delivers the best ROI for your email marketing campaigns. As with all marketing strategies, there is more than one way to generate new subscribers—but which are the most effective? Here, we’ll take a look at the pros and cons for two of the most popular methods for building subscription lists, so you can determine the strategies that will work best for your business.

Contests, competitions, and giveaways

The idea behind this strategy is deceptively simple. By offering something valuable as a prize, and requiring people to opt in to your mailing list in order to enter, you could theoretically generate a landslide of new subscribers. However, depending on the way you set up the competition, this method can end with mixed results.

The pros:

Contests and giveaways can definitely boost your subscription numbers—especially if you offer a reward that people truly want. Give away a brand-new iPad, and you’ll have signups in droves—as opposed to less valuable prizes, such as discount coupons, which usually result in a trickle.

Another benefit to this strategy is the lasting effect a competition can have on your website visibility. If your traffic spikes due to a flood of visitors signing up for the contest, search engines will take notice and your ranking could enjoy a permanent increase.

The cons:

While you’re likely to enjoy a big increase in subscriber numbers, the boost from contests is often temporary. Some people will simply unsubscribe from your list when the competition is over—in fact, there are people called “sweepers” who enter every giveaway they can find online as a hobby.

The expense can also be a drawback. In addition to footing the bill for the prize, a successful contest often requires an extra investment in marketing to spread the word. However, it’s possible to get around the marketing expense with creative (and free) social media strategies.

Send-a-friend programs

Also known as refer-a-friend or referral programs, the goal of this strategy is to have your customers market for you. Send-a-friend programs typically reward customers for getting other people to join your opt-in list. Rewards can range from discounts or upgrades to money.

The pros:

Studies have shown that customers obtained through send-a-friend programs have higher retention rates. They’re also more likely to convert into paying customers—and they spend more on average than non-referred signups. These programs result in better quality customers who remain loyal for longer.

The cons:

Unlike competitions, which come with a rapid rise in subscribers, building a list through a send-a-friend program is a gradual process. The use of this strategy requires patience—but the steady returns can have a cumulative and positive effect on your business.

 

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