There are two main types: charity raffles and charity sweepstakes when it comes to giveaways. Both have their pros and cons, the decision will ultimately rely on which one aligns best with your charity goals. 

Charity Raffle

A raffle is a type of lottery in which consumers purchase tickets to win a prize, which is generally a cash prize. Because contributors pay money in exchange for a chance to win something – just as at a casino – raffles are considered gambling by federal government authorities in the United States. The office of the State Attorney General regulates raffles.

US federal law allows raffles to be held for charitable causes as long as 501(c) corporations conduct them. Organizations conducting raffles must follow the state and local raffle rules and regulations that apply.

Online raffles are restricted in some states like Alabama and Arkansas, making it difficult to run an interstate raffle and even harder to conduct one nationally. If you prefer to run a national promotion, sweepstakes are a better choice. 

Charity Sweepstakes

Charity sweepstakes are less restricted than raffles in terms of geographical limitations, and they can be offered nationally. As a result, fundraising sweepstakes have a broader reach when organizations wish to appeal to a larger audience.

Sweepstakes give you access to a larger audience since there are no geographical restrictions. However, a free method of entry must be accessible in addition to donation-based entries. Charity sweepstakes are an excellent way for businesses and non-profits to partner up, reach new consumers, and donors.

Many charity sweepstakes appeal to a wider audience because they aim to provide services or products to people in larger r categories of interest, such as animal shelters, children’s hospitals, and other healthcare organizations.

Benefits of Running Charity Sweepstakes

Charity Sweepstakes Help Increase Donations

Charity sweepstakes might appeal to individuals who might not otherwise donate to a specific cause. 

To run a successful charity promotion, your organization will have to bring awareness to your campaign through events, online advertising, and other marketing outlets. Keep your promotional cadence consistent throughout the sweepstakes campaign. This will help you attract the most participants/donors. 

Charity Sweepstakes Increases Awareness

Another advantage of sweepstakes is the buzz they generate. Sweepstakes are both entertaining and exciting! The prizes, whether big or little, frequently create a lot of engagement on social media.

Great Conversation Starter

It’s simple (and enjoyable!) to talk about the fantastic prize you’ve won or are participating to win in charity sweepstakes. People love winning prizes. This is a great chance to also leverage word of mouth to attract more donors and educate participants/donors about the cause. 

Increase “Touch-points”

A touch-point is defined as the number of times a person sees or thinks about a brand or organization. The more instances a person encounters or contemplates a charity, the more inclined they are to give! It generally takes 7-10 touchpoints to get people to donate to participate in your sweepstakes. 

With charity sweepstakes, individuals aren’t simply writing a check and forgetting about it. Many charity sweepstakes offer numerous giveaways throughout the year, ensuring that donors are reminded of the cause each time another winner is announced.

Fun & Shareable

Charities may benefit from charity sweepstakes in a variety of ways. Due to the buzz that is generated during giveaways, charity sweepstakes are a successful technique to promote awareness for a particular cause and increase donations.

The primary aim of charity sweepstakes is to raise money and awareness for the n charity.

This means that each social media sharing, press appearance, YouTube video, and newspaper story will also include information about the cause and offer a chance to win in exchange for a donation. In terms of raising public awareness about a nonprofit, this exposure is priceless.

Conclusion

Charity sweepstakes allow participants to enter with a donation. They generate more entries thanraffles, so your organization has a better chance of achieving fundraising goals. s.

Finally, charity sweepstakes are much easier to promote than charity raffles – simply put up a post on social media or send out an email blast and you’re good to go!

For more information on how Sweeppea can help you with your next sweepstakes, contact us at support@sweeppea.com or call us at 305-505-5393.

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Nonprofit fundraising is an important way to raise money for a good cause. However, it’s important to make sure that you are legally compliant when you are raising money.

Many nonprofit promotions take the form of sweepstakes or raffles, but there is a big difference between the two. In this article, we will discuss the difference between sweepstakes and raffles for nonprofits, and explain when a nonprofit promotion becomes an illegal lottery.

Sweepstakes vs Raffle for Nonprofit

Sweepstakes are games of chance where a prize is awarded to a lucky winner chosen at random. Raffles are different from sweepstakes because they involve the sale of tickets, and the winners are chosen through a random drawing. The key difference between these two promotions is that raffles require participants to purchase tickets, while sweepstakes do not.

There are cases where businesses are interested in running purchase-to-enter sweepstakes. They can be legally compliant if the legal aspects of the sweepstakes are correctly managed. For more information, check out our article on No Purchase Necessary Laws. 

Nonprofit Raffle

A nonprofit raffle is a fundraising effort that involves the drawing of lots to select a winner or winners if there are several prizes. An online raffle (also known as an electronic raffle) uses computers and technology for ticket sales, winner selection, and prize delivery.

A traditional raffle (also known as an offline or in-person raffle) involves the distribution of physical tickets on-site for a few hours during an event. The primary difference between online and conventional raffles is online raffles have their entire process online. This includes setting up a landing page with accessible payment options for ticket purchases and a digital prize. 

In The United States, just like in many other countries, only nonprofit entities can run raffles. 

Raffles are legal with various restrictions in 47 of the 50 states. The 3 states that prohibit raffles altogether are Alabama, Hawaii, and Utah. 

For more information on the difference between sweepstakes, raffle, and a lottery check out What’s the Difference Between a Sweepstakes, Contest, Game, Raffle and Giveaways and Which is More Popular?

Nonprofit Sweepstakes

Sweepstakes are similar to raffles in 2 ways: random selection of winners and distribution of prizes. The major distinction between them is in the method of entry. A participant does not have to purchase in order to enter a sweepstake—this is why sweepstakes are not considered gambling and can be offered throughout all 50 states.

When running a sweepstake, there are a few laws you need to pay attention to. Multiple agencies, including the FTC (Federal Trade Commission), USPS (United States Postal Service), FCC (Federal Communications Commission), and several state agencies regulate sweepstakes and giveaways. 

No Purchase Necessary laws state that you cannot ask entrants to make a purchase or provide some other form of consideration for entry. By offering sweepstakes, you may entice participants to donate as the primary point of entry as long as there is an alternate method of entry that does not require donations..

An alternate means of entry (AMOE) could be:

• An online entry form
• A mail-in entry
• An email entry
• A text message or phone entry 
• Via social media platforms like Facebook, Instagram, or Twitter
• In-person entry at stores, offices, or events

Is Your Nonprofit Fundraising an Illegal Lottery?

In the United States, only the government can run lotteries. They have both federal and state regulations in place for lotteries and must comply with the following:

1. A prize with monetary value
2. Luck. The outcome of the campaign is not dependent on skill.
3. “Consideration.” An entrance fee is required. This payment may be money or anything else that takes a significant amount of time away from the entrant or provides a benefit to the promotion’s sponsor.

So, what happens when nonprofits try to combine elements of both sweepstakes and raffles?

This is where things can get tricky, and it’s important to understand the law before you launch your promotion. If your nonprofit promotion involves the sale of tickets AND an element of chance, it will be considered an illegal lottery.

However, there are some exceptions to this rule. For example, if the prize is awarded based on skill, rather than chance, then your promotion may be considered a contest and not a lottery.

Here are some examples:

• Sweepstakes: Sweepstakes aren’t classified as lotteries since there is no purchase necessary to enter—only a prize and luck.
• Contests: Although most contests provide a prize and consideration, they are not luck-based. True contests are trials of skill, which removes the element of chance from the equation.
• Raffles: Raffles are a gray area and are seen as lotteries in certain states. 

Conclusion

Promotions are a great way to raise money for your organization, but they can also create issues, especially if they aren’t structured properly under federal and state regulations.

If you are unsure whether or not your nonprofit fundraising is sweepstakes, raffle, or illegal lottery, it’s always best to consult with an experienced sweepstakes administrator like Sweeppea. This will ensure that you are following the law and that your promotion is fair and legal. Need help with sweepstakes or contest management? Call 305-505-5393 or email us with your questions.

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