For many businesses, a contest is a perfect
way to reward loyal customers and bring in new traffic. Best of all, you don't
have to be a huge company with deep pockets to start a contest. However, there
are some legal matters you need to be aware of before diving into the contest
arena. Keep these guidelines handy before considering launching your contest.
Make
it a sweepstakes or contest.
Sweepstakes and contests might sound like
the same thing but in the legal realm they are quite different. A sweepstakes is
when a person merely "enters" to win something. That can be as simple
as submitting an email address or sending a text. On the other hand, a contest
involves some sort of skill like writing an essay. You'll want to make that
distinction because each one comes with a specific set of legal guidelines/restrictions.
Make
a list of rules.
You'll need to make a list of rules for
your contest and then adhere to those rules. These rules should cover the
typical items such as deadlines, eligibility requirements and rewards. They
should also cover every possible scenario in terms of winning and losing. In
other words, don't leave anything to second-guessing.
Make
it region specific.
It's easy if you have a small neighborhood
business and want to run a contest for your customers. You would only have to
look up the guidelines as it pertains to your city and state. However, if you
want to go national or international you're going to need to do a lot more
research. This is why many contests have built in restrictions as to who can
play.
Make
sure you understand the online rules.
Obviously, the best way to reach the most
potential customers would be with an online contest but that will open the door
to a whole new range of possible restrictions. You might think it's a good idea
to run a contest in order to get an expanded email list, but in reality you could
be prevented from using those newly acquired addresses. Make sure you follow
the rules especially when there is the potential for minors to be exposed to
your contest.
Make
sure you get a good attorney.
Suppose your contest involves printing
"golden tickets" that a customer needs to find. What if the printer
messes up and everyone gets a golden ticket? That scenario actually happened to
Kraft Foods back in 1989 when suddenly all of the contestants in a contest were
claiming brand new cars when there was only supposed to be one winner. Since
then the "Kraft clause" was instituted to cover those kinds of human
errors. An experienced attorney who has crafted rules and regulations for a
contest will know all about those clauses and that's who you should be
retaining to help with your contest.
When it comes to contests, you want to make
sure your company comes out as the real winner!
