Marketing for a product is quite a tricky business especially when you are unaware of the successful promotional strategies. Most of the companies out there are eager to gain more visibility and attract customers. But little do they know that if their messages go wrong, it could hit them hard with a huge loss. Well, some of the top multinational corporations have had their times as well. Here are their promotional campaigns that went wrong. Many of these mistakes would seem obvious, but no one saw them coming their way and the ended up being very bad.
1. When the Summer Olympics in 1984 started in Los Angeles, McDonald’s had decided to run a promotional campaign. It included offering free meals each time any US athlete won a medal. However, it turned out to be one of the costliest promotions ever. The Soviet Union, the Olympic’s powerhouse, boycotted the entire event and let the US win.
Before the Olympics started in Los Angeles in 1984, our all-time favorite fast-food chain, McDonald’s, decided to run a promotion “When the US wins, you win” within the nation. They offered free Big Macs, french fries and Cokes each time any US athlete reached the podium and won gold, silver, or bronze medals. Customers having game cards mentioning these events were also considered winners. The franchise in the San Francisco Bay Area was hit so hard, they even ran short of hamburgers. Later, the Soviet Union, the team’s powerhouse team, decided to boycott the games and let the US win. The promotional campaign did gain more popularity than expected. However, a franchise in South California reported in a local newspaper, “With all the gold medals that the U.S. is winning, we’re swamped … this is the most successful [McDonald’s promotion], but it’s also the most costly.” (1, 2)
2. The AAirpass, a promotion by American Airlines that let people pay a one time $250,000 fee and have a lifetime of unlimited flights, ended up costing the airlines more than $21,000,000 when one of the first-class ticket holders traveled on more than 10,000 flights.
American Airlines offered its flyers with an AAirpass that allowed them to fly first class for unlimited times in 1981. The one-time fee for the pass was $250,000. At an additional cost of $150,000, a companion could accompany them. The pass holder could then bring anyone along for a lifetime free ride in business class. The idea behind this promotional campaign was to gain more flyers by providing the wealthier flyers with the pass. But the public turned out to be way smarter than they had thought. Among the wealthiest flyers was one who traveled more than 10,000 times, which led the company to take a huge loss of $21,000,000. It was reported that 66 AAirpasses were purchased under this condition of free travel. Among them was the baseball player Willie Mays, the businessman Michael Dell, and America’s Cup winner Dennis Conner. AAirpass was discontinued after 1994, but 28 people had already benefited from the lifetime deal. (source)
3. A promotional campaign run by Pepsi in the Philippines led to outrage when Pepsi went on to mistakenly print 800,000 winning caps. According to the campaign, the person who found a bottle with the winning number would win $40,000.
Pepsico Inc. started a promotion “Number Fever” in 1993, promising 1 million pesos, which is about $40,000, in cash to the one who found a 3-digit number inside the bottle cap. The motto of the promotion was to make millionaires from some of the poor Filipinos. When the company announced the winning digit to be the number “349,” thousands of people headed to the Pepsi plants all across the country to receive their cash prize.
However, the company refused to pay them and said they it was not the correct winning security number. The winners then argued that the promotional description didn’t mention that a winning security code was needed; only the number displayed would determine the validity of the cap. This led to massive outrage, and the company then decided to pay each of the winners $18. Since there were over 800,000 caps with the code 349, the company paid out $10 million. (1, 2)
4. In 1994 as part of a promotion campaign, Fiat sent out 50,000 anonymous love letters to young women in Spain with the intention of revealing its identity after 4 to 5 days. The campaign backfired and instead of curiosity, it spread panic and fear of stalker among women.
Fiat, the Italian car-making company, was all set to launch a new promotional campaign in 1994 in Spain. The promotion included sending about 50,000 love letters by unknowns to modern young women. It said that the identity of the sender would be revealed within four to five days. Each woman received a typed letter on pink paper that included several compliments and invitation for adventures. Some of the common lines were “We met again on the street yesterday and I noticed how you glanced interestedly in my direction.” A spokesman at the company said, “We thought it was a fun campaign aimed at the independent, modern, working woman.” Instead, it created a feeling of insecurity among women that they were being stalked by psychos. The campaign even caused arguments and jealousy among married couples. Fiat had to discontinue the campaign and apologized once the protests started. (source)
5. The CEO of Lifelock decided to run a promotional campaign in which he published his Social Security Number in product advertisements for promoting his company. However, his identity was stolen 13 times, and the company had to pay $100 million for misleading advertising.
LifeLock Inc., a company based in Arizona, focused on providing anti-theft services. Consumers were provided with theft-protection systems that helped in detecting any fraudulent applications for services related to credits and non-credits. However, the CEO of the company provided his Social Security Number on the products while he conducted promotional campaigns through the ads. His number was stolen by fraud, and it caused him to lose his identity about 13 times. In 2015, he had to pay $100 million to the Federal Trade Commission to settle the charges, since he deceptively promoted his products and failed to protect the information of the customers. The false claims about protecting the consumer’s identity 100% were misleading, and the company had to bear this huge loss. (1, 2)