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After 31 years, the biggest Roll up the Rim winner is Tims

Roll up the Rim to Win
[The promotion has been running for over 30 years/CBC]

Tim Hortons kicked off its RRRoll up the Rim to Win campaign earlier this month with over 294 million cups in circulation and over $77.5 million in prices up for grabs.

The 31st year of the contest have seen a slow scale-up of prizes and cups in circulation over the decades but it’s the simplicity of the contest which has made it a promotional juggernaut, says Sylvain Charlebois, dean of the faculty of management and a professor in food distribution and policy at Dalhousie University in Halifax.

“It’s a highly successful marketing campaign… many wondered if it would survive the ownership transfer between Tim Hortons and Restaurant Brands International but it seems to be very successful still after a few years,” he says. “Obviously there’s something there that really resonates with the Canadian public; it has a lot to do with the slogan, it’s memorable, easy to remember.”

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But behind the simplicity of the promotion on the consumer end, there are a lot of working parts for the brand.

For this year, non-coffee and donut prizes include 40 2017 Honda Civic Coupe EX-T worth about $23,290 not including applicable taxes, freight and inspections; there’s 150 55″ LG 4K UHD TV prizes worth $1,599; and 100 $5,000 CIBC Prepaid card prizes. These are brands that know the reach of the promo and have often signed on for the co-branding opportunity.

“In many cases sponsors work with brands, they’ll have an arrangement where the brand co-sponsors and donates the prizes for marketing,” explains Steve Szentesi, a Toronto-based lawyer with an expertise in contests and promotions regulatory law.

For a contest like RRRoll up the Rim, marketing and prizes tend to be the biggest expenses. Administrative elements like training staff what to do if someone wins a car or how to keep track of free coffees and donuts are also a big part of running these types of promos, adds Charlebois. On the whole, franchisees pay an advertising fee of 4 per cent of gross sales.

“At the franchise or store level there needs to be some tweaking and changes, it’s not just about giving food away, you have to run a tally of what’s happening as well so it can be reported back to head office,” he says.

But ensuring the rules comply with Canadian regulations isn’t difficult once the framework is in place, says Szentesi.

“Most contests are quite efficient to run from a legal advice perspective,” he says noting that the short rules on the cups and in-full online function as contracts between Tim Hortons, co-sponsors and the customer. “Big ones obviously require more admin stuff.” He suspects it only costs around $5,000 to $10,000 for Tim Hortons to get their legal ducks in a row for the contest.

Running a contest in Quebec, which is the second biggest provincial market for the campaign, distributing 36.7 million cups versus Ontario’s 154 million, presents its own unique challenges.

Which is why you often see contests run Canada-wide with the caveat “excluding Quebec” says Andrea Kroetch an associate in Smart and Biggar’s marketing and advertising practice.

The Régie des alcools, des courses et des jeux which governs alcohol, lotteries, contests, gambling has a stringent set of guidelines including registering the sweepstakes rules and promo advertisements with the Quebec government at least 30 days ahead of the event’s launch, fork over a fee of up to 10 per cent of the sweepstakes’ value (depending on who is allowed to enter), allow the provincial government to mediate any lawsuits arising from the contest and, among other things, put down a security deposit on prizes over $5,000.

“A lot of time contest sponsors just don’t want to deal with the regulatory regime,” says Kroetch.

On the prize side, while there’s no law in Canada that says the company has to have a warehouse full of televisions and cars to give away, they are required by the competition bureau to distribute the prizes as soon as somebody wins them (within reason).

“You can’t have a contest for a prize that you can’t actually give away,” she says. “Usually what (sponsors) will do (is) reserve right to substitute a prize of equal or greater value to whatever prize you’ve been awarded.”

Another common practice for contests is to calculate the odds of winners and take out an insurance policy that will pay out in the event someone wins the prizes, says Charlebois.

“The number of people who actually win is a lot smaller than the actual number of cups being given out,” he says. “An insurance company would actually evaluate the potential for one person to win a car, win a TV from one province to another and assess the risk.”

Then they issue an insurance policy based on that risk that will pay out if anyone happens to draw the car-winning cup.

But the RRRoll up the Rim contest isn’t always a winner for Tim Hortons. In 2011, the company’s 25 anniversary, freebie redemptions in the first quarter shaved about one percent of same-store sales growth.

Charlebois points out that another downside to the contest is that it tends to keep customers in the store without paying.

“Obviously they need to drink the whole thing before redeeming their prize and if it is a box of Timbits or a free cup of coffee (that person) will stay in your restaurant for potentially another 20 minutes or half an hour or so,” he says, which in turn takes a spot for a paying customer. But Charlebois suspects Tim Hortons is probably okay with the loss for the couple of months the promo runs given the value in having a full restaurant and the perception that gives passersby.

“After 30 years, I suspect they’ve worked out the numbers which would suggest they are running a very profitable campaign – a lot of people are talking about it, it’s covered by media, people actually go for a visit and people love free stuff,” he says. “Tim Hortons gives you your ticket to free goods, all you need to do is buy what you normally buy.”