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How to Use Contests, Sweepstakes, and Giveaways as Marketing Tools - While Staying Within the Law

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How to Use Contests, Sweepstakes, and Giveaways as Marketing Tools - While Staying Within the Law

By NicoleD
Published: March 23, 2010 Updated: February 11, 2011

In a tough economy, small businesses need to get creative in order to : The concept behind a legitimate contest is that winners are selected purely by chance - meaning, customers don't have to pay or buy something to either enter into the contest or improve their odds of winning. This includes requiring customers to pay taxes or shipping fees to claim their "prize." An exception to this rule is a skills-based contest - if your contest prizes are awarded based on a skill, knowledge, or talent (like in a trivia contest or singing competition), you may legally require participants to make a purchase for entry.



  • Identify your business: If you are sponsoring a contest, make sure that your customers can clearly identify your business's name and contact information prominently, and offer your customers a clear and easy way to remove themselves from your contest solicitation.

  • Remember the small print: Be clear and upfront about the terms, conditions, rules of entry, and odds of winning the promotion.

  • Be truthful about endorsements: It is illegal to misrepresent endorsement or ties to well-known organizations and government agencies.



  • Still have questions? You can talk with someone at your


    Message Edited by NicoleD on 12-23-2009 12:04 PM

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    @ fineasfineas - I would suggest that you check with your state AG's office or your local FTC regional office for a template. These rules vary state-by-state so a universal template may not work.
    Thanks for the article. I am looking into running a giveaway contest for our local restaurant. There will be no entry fees. The prize may be a travel package.  Depending on cost of prize(s) and who we partner with, there may or may not be fees involved in using the prize.  The ablity to choose flight times and change hotel and other options. Is there any sample contest (sweepstakes, free raffle, other contests) rules and guidelines that we can look at and then change to suit our needs. There are plenty of online contests with their own rules and conditions, but they are copyrighted.  any and all help is welcome
    Excellent post! I am a consumer who has been taken advantage of by promotions. I have learned from my mistakes and offer ethical promotions towards my own customers with my canvas art business.Message Edited by NicoleD on 12-29-2009 09:12 AM

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