Have you ever wondered why companies hold sweepstakes? What legislation governs these types of free contests? With no real information easily attainable to the average hobbiest we thought we would put together a 8 week set of articles to help you walk through the “sweepstakes jungle”. Its our hope through this article series that you will be much better armed to enter in sweepstakes of all kinds whether they be strictly online, mail-in or a mixture of both.
With all of that in mind lets go to the first question in our series:
Definition: What is a sweepstake?
Sweepstakes (also called prize promotions or games of chance) are essentially popular tools for businesses, marketers, and agencies to build customer loyalty and collect valuable demographic information about potential consumers.
A Sweepstakes Overview
A sweepstakes is a promotion in which a prize is awarded to a participant on the basis of chance, not skill. That prize can be monetary or non-monetary, such as a free product or trip. Sponsors of such promotions cannot require people to purchase a product or to invest “considerable” time or effort in order to enter the sweepstakes.
Here are some basic rules that all sponsors must comply with:
All sweepstakes must have official rules and those rules CANNOT change after the official starting date. Official rules must contain the following kinds of information:
- A “No purchase is necessary” statement
- Start and end dates
- Eligibility requirements (age, residency, and a list of those excluded from participating)
- Methods by which people can enter the sweepstakes, including a “no purchase” method, such as a 3″ x 5″ postcard
- Any limitations on the number of entries pe (more…)
