Risk Management

The economics of prize promotions

A million-dirham prize doesn't cost a million dirhams — provided someone else carries the tail.

Risk Management← Knowledge Centre

Expected value is a probability times a payout. For most well-designed mechanics, the expected value is a fraction of the headline prize.

Self-insuring that tail means holding budget aside 'just in case' — which turns a fixed fee into a permanent contingency line.

Prize Coverage converts that contingency into a single cheque. The marketer commits, the underwriter carries the tail, the customer sees the promise as real.

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