If you’ve ever entered a free online competition–maybe to win a trip to Santorini, a shiny new gadget, or even just a year’s worth of coffee–you’ve probably had this thought at some point: “How is this business making any money by giving stuff away for free?”
It’s a fair question, especially when it seems like a one-sided deal. You click, enter, maybe tag a friend or two, and someone walks away with a prize. But in reality, these competitions are often part of a smart marketing strategy. They’re about prizes but they’re also about creating connections, building trust, and yes, growing a business.
Online competitions are a fantastic way to put fresh products in the spotlight. It could be the latest gadget, a new skincare range, or a tech startup’s innovative fitness tracker. Contests like that offer a dynamic launchpad to build curiosity and hype.
Let’s say a brand wants to create buzz for a just-launched wearable. Instead of pouring all their budget into ads that may or may not convert, they run a giveaway for ten lucky winners. Thousands enter and each participant now knows about the product, and better yet, they associate it with the chance to win something exciting.
Even those who don’t win are often sent a follow-up email with a generous discount code. It’s just enough to tempt them into buying the product they were already interested in. This is how businesses transform casual browsers into paying customers, all while spreading the word with minimal ad spend.
If you like entering competitions regularly, platforms like BestCompetitions make the process easy and more engaging. These hubs aggregate current giveaways across categories. It could be from travel and electronics to beauty and fashion. This allows you to discover new brands and exciting offers in one place. It's not just a win for the entrant, but a win for companies seeking highly engaged audiences, too.
Another reason brands embrace online giveaways is that they open the door to building meaningful customer relationships. When you enter, you’re typically asked for your name, email, and perhaps a bit more, like your preferences or birthday. This isn’t just for fun; it allows the brand to personalize how they talk to you later.
But don’t worry–it’s not some kind of marketing trap. What you’re really doing is joining a community of people who share your interests. Based on your preferences, you might get updates about new releases, special deals, or tailored recommendations that actually feel relevant.
Behind the scenes, companies use platforms like Mailchimp or Klaviyo to organize and segment this information. These tools help businesses understand their audience better, track engagement, and offer content that aligns with what people genuinely want to see.
Instead of chasing down random shoppers, brands now have a list of people who already showed interest by entering a competition. That’s incredibly valuable, and it helps them spend their marketing budgets more efficiently.
You've probably seen those classic Instagram giveaways. You need to follow the account, like the post, and tag some friends. Simple instructions, but the ripple effect can be massive.
Each person who participates brings the brand to a fresh audience. Maybe your friends tag more friends. Maybe one of them clicks through and becomes a loyal customer. These organic shares increase visibility far beyond what a typical ad might accomplish.
What’s especially clever here is how this exposure taps into social media algorithms. The more people engage in liking, commenting, and sharing, the more platforms like Instagram and Facebook boost the post’s visibility. It’s a free promotion, but it’s also viral marketing powered by real users.
So while a brand might offer a prize worth £100, the return in visibility, traffic, and engagement could be worth thousands. And the best part? It feels genuine. People aren’t just seeing an ad, they’re interacting with it.
Many online competitions are designed to guide users to a brand’s website. Maybe you’re asked to sign up, answer a short quiz, or explore products as part of your entry. This formality is a strategic move.
Getting users onto a website gives businesses a chance to showcase what they do best. Visitors might discover product lines, sign up for future offers, or read glowing customer reviews. Each interaction builds familiarity, and familiarity builds trust.
In digital marketing, traffic equals opportunity. Even if someone doesn’t make a purchase right away, their visit may improve SEO, boost engagement stats, and allow for retargeting later through ads or email. Think of it as planting seeds for future sales.
For example, imagine entering a competition for a year’s supply of artisan skincare. You land on the site, learn about the ingredients, and notice a limited-time offer on your favorite serum. Suddenly, you’re not just entering a giveaway but you’re starting a relationship with the brand.
Online competitions don’t just live on brand websites. You’ll often see them hosted on blogs, YouTube channels, or influencer platforms. That’s where affiliate marketing and partnerships come into play.
Take, for instance, a food blogger hosting a giveaway for a high-end kitchen mixer. They write a glowing review, link to a retailer, and invite readers to enter. If someone clicks the link and makes a purchase, the blogger earns a commission through affiliate platforms like Amazon Associates or Awin.
Meanwhile, the kitchenware brand might be sponsoring the contest outright, providing the prize and paying the blogger to promote it. It’s a win-win: the brand gets targeted exposure, and the blogger earns income while delivering value to their audience.
This approach isn’t limited to gadgets and gear. You’ll see it used for books, beauty boxes, pet products, and even online courses. It’s a powerful way to create content that feels valuable, not salesy.
Many competition-focused websites don’t just earn through giveaways. They also monetize traffic directly through display advertising. Think banners, pop-ups, and sponsored placements powered by platforms like Google AdSense or Mediavine.
Each time you visit the site or click on an ad, the site owner earns a small amount. When those visits number in the thousands (or tens of thousands) that small amount adds up fast.
This model is especially effective for platforms that regularly post new contests. Frequent updates encourage users to return often, which increases page views and, in turn, ad revenue.
Even if a visitor doesn’t enter a competition or click on anything else, their presence still contributes to the site’s bottom line. For competition hubs, that makes each visit valuable, regardless of the outcome.
Beyond immediate traffic and data collection, competitions help brands establish trust and long-term loyalty. Giving away something valuable like a spa weekend or a tech bundle feels generous. It tells potential customers: “We want to do something nice for you.”
That sentiment builds goodwill. People remember positive experiences, especially if they win. But even those who don’t win often continue to engage with the brand, sign up for newsletters, or follow on social media.
Over time, these small touches add up to a stronger brand relationship. A contest might be the first point of contact, but follow-up emails, relevant offers, and helpful content turn that initial click into an ongoing connection.
Let’s also not underestimate the power of word-of-mouth. If someone wins a big prize like a tropical vacation or a home makeover, they’re probably telling their friends, posting about it online, maybe even tagging the brand in their stories. That’s authentic, free publicity that’s nearly impossible to manufacture.
While online competitions may look like random acts of generosity, they’re usually well-planned initiatives designed to help businesses grow. They offer value to consumers while helping brands generate awareness, traffic, engagement, and yes, revenue.
But that doesn’t make them sneaky or dishonest. When done ethically and transparently, giveaways are simply another tool in the marketing toolkit, one that happens to be fun, engaging, and mutually beneficial.
So the next time you enter a competition for a dream vacation or your favorite gadget, enjoy the moment. Whether you win or not, chances are you’ve discovered something new, joined a community, or unlocked a deal.
