Five Ways Challenger Brands Can Effectively Use a Limited Time Offer

December 8, 2015 | blog | By Mike Sullivan


You only need to look at the 30-year success of the McRib to know limited time offers (LTOs) work, and here are five ways Challenger Brands can effectively use a limited time offer.

1 – Create the Right LTO for Your Brand

As a challenger brand, you’ve got to customize your LTO to not only effectively reach your customer base, but also fit the personality of your brand. Whatever LTO you design should support and boost brand excitement. The LTO can push the envelope on flavor combinations or new ingredients while staying in line with what customers expect from your menu, it just needs to make sense for your brand. Interestingly, if you’re targeting Millennials, a 2014 Technomic study suggests that half of this age group, along with Gen Xers, enjoy being the first of their friends to try an LTO menu item.

2 – Create Scarcity to Generate Sales

Limited time offers operate on the principle of scarcity – one of Robert Cialdini’s Six Key Principles of Influence. Make sure your messaging emphasizes the limited availability and short duration of the promotion. If your customers perceive that a menu item, especially one that is presented as a premium product, is only available for a short time, the resulting sense of scarcity will generate demand. The same goes for items promoted as being available “while supplies last.”

3 – Create a Sense of Urgency

The sense of impending FOMO (fear of missing out) often gets consumers to purchase limited time or limited-run items. There are two schools of thought about posting the end date of your LTO. Some recommend supplying the end date to customers so they feel this sense of urgency, while others avoid listing the ending date of the promotion believing customers will always feel that the promotion is about to end.

Either way, do pick a definitive timeframe (3 to 4 weeks is typical. Any longer and customers get used to the menu item and no longer consider it “special”). Also, promote the impending close of the limited time offer with signage, social media and other marketing that uses phrases like, “Hurry, offer ends soon!” “We’re running out of [menu item] and you’re running out of time!”

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4 – Timing is Everything

When planning LTOs as a challenger brand, you not only need to know what your customer base is interested in, but when. Look at your customer data to determine which items are your best sellers during each season.

In the fall, you might find customers gravitate toward heavier, comfort foods flavored with the rich spices that remind us of the holidays – cinnamon and clove, mint and chocolate. Spring may create demand for fresh and healthy, produce-heavy dishes, while summer might focus more on fruits, lemonade and BBQ. Also, look for common flavors, ingredients or spices in dishes that grow more popular during certain seasons.

You don’t have to tie your LTO to a holiday, but that strategy can work. Established brand Starbucks rolls out all things pumpkin long before Halloween and keeps the LTO beverages flowing with gingerbread, peppermint mocha and eggnog through the holiday season. However, Wendy’s successful Pretzel Bacon Cheeseburger LTO in 2013 wasn’t holiday-related and generated huge sales for the Dublin, Ohio-based chain. It was initially so successful, in fact, that the new burger became a regular menu item in 2014. Alas, customers had their fill of the Pretzel burger by the end of the year and it was yanked from menus in March 2015.

The temptation to turn a highly successful LTO into a regular feature is strong, but maintaining the LTO timing discipline for a unique item is generally considered a marketing best practice.

5 – Create a Long-term Relationship with Customers

Take advantage of the LTO to capture customer data via mobile payment or ordering, asking for email addresses or encouraging customers to sign up for social media updates. Next, survey customers to gauge which LTOs they like best and engage them in the process by asking for input/suggestions or voting on upcoming LTOs or seasonal specials. Reward customer loyalty with coupons or gift certificates and encourage customers to tweet about the LTO by creating a specific hashtag for the promotion. Be sure to re-post their positive social shares.

While you can’t rely exclusively on LTOs to drive sales, and you certainly don’t want to run so many that they cease to be special enough to grab customer attention, the LTO is a great tool for challenger brands. You can create a sense of fun and anticipation for your brand by featuring a few carefully planned LTOs in your annual marketing plan.


Mike Sullivan

President at LOOMIS, the country’s leading challenger brand advertising agency


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