Val-Pak Uses $100 Checks to Get Its Envelopes Opened
About 43 million envelopes will be mailed by 96 of Val-Pak's local dealers during the eight-week campaign, and one in every 50,000 contains a $100 check payable to the addressee. The flap side of each envelope is emblazoned with the phrase "A $100 check may be inside," and the promotion is getting local advertising support in other media.
"We're not asking them to do anything but open up the envelope," said Ed Neel, director of network promotions at Val-Pak. "There's no strings attached."
Currently, Val-Pak dealers pay for the promotion directly, although Neel said he hopes to secure support from a national retailer for future versions.
"We're looking for a national sponsor now -- a Sears, a Penney's or a Home Depot that wants to put a $100 gift certificate in the envelopes," he said.
The company tested the current promotion in several markets during the past nine months before offering it to its local dealers nationwide as an optional campaign beginning April 1.
"The $100 seemed to be enough to get a person's attention without being so much that it would cause any kind of chaos," said Neel, adding that the company expects to use the program on a national basis three or four times per year.
Rich Bowie, owner of Val-Pak of Western Washington, Seattle, began testing the $100 promotion about four months ago.
"It sure gives us an opportunity to go to our advertisers and keep telling them, 'Look, we're not resting on our laurels. Even though we are a market leader, we are continuing to look at ways to make this work better for you, the advertisers,' " he said.
Bowie said that consumers cashed about 65 percent of the checks that were distributed in his first mailing. He had not yet tallied the results from subsequent mailings.
Nationally, Neel said, consumers cashed about 50 percent to 60 percent of the checks in early phases of the testing. He and Chris Bilotta, sales promotion supervisor for Val-Pak, said they thought that consumer doubts about the authenticity of the offer might be the reason that nearly half the winners did not cash in.
In follow-up letters to those who redeemed their checks during the tests, Val-Pak queried the winners about their experience. Many said they did not believe the promotion was authentic until they went to try to collect their winnings.
"They were just so pleased that there was nothing else to do except cash it or deposit it," said Bilotta.
Bowie said the promotion's credibility got a boost in one of his areas when a local radio announcer received one of the $100 checks and gave Val-Pak some impromptu on-air praise.
Bowie also supports the mailings with radio advertising during traffic reports on 28 different radio stations in western Washington. The spots are aired during the week before and the week of the mailings, Bowie said.
"It gives us further awareness with the advertising community and with consumers," he said.
Such so-called in-pack promotions, he said, are a valuable tool in recruiting advertisers.
"Everything we do in this vein helps our sales reps go and knock on doors," he said. "This softens them up a little bit. Thirteen years ago, when I started this business, that was very heavy lifting."
Val-Pak has done sweepstakes-style promotions in the past, but hasn't offered any on a national basis since it ended its "Out of the Blue" sweepstakes a few years ago, Bowie said.