Sweepstakes, contests, games, raffles, giveaways. These are all words that people use to describe an event where prizes are given away to a winner chosen for skills displayed via an entry or at random. But what are the differences between these types of promotions?

Legally, what matters most in promotion is how one or several winners are selected or drawn. Here is what you need to know about sweepstakes, contests, giveaways, raffles, and more.

What Is a Game?

A game is any promotion in which a winner is selected as the outcome. It can be a game of skill or a game of chance. For example, a contest is a game of skill while a sweepstakes is a game of chance. However, a giveaway and a raffle can also be categorized as games.

Many courts use what is called the “Dominant Factor Test” in order to determine if a promotion in question is in a game of chance or skill. This allows the courts to determine whether luck or skill is the most important aspect in the selection of a winner.

What Is a Sweepstakes?

So, let’s define sweepstakes.

A sweepstakes is a promotional drawing in which prizes are given away to participants. There is no purchase required to enter and the sweepstakes winners are selected at random from a pool of all the eligible entrants.

Contest vs Sweepstakes

A contest is also a promotional drawing in which prizes are given away. However, there is one major difference: skill. Participants in contests are judged by their entries according to a predefined set of criteria.

How to run a contest? From the pool of participants, the “best” entry is selected to win and is awarded a prize including cash, cars, and more. The criteria upon which an entry could be judged include a skill, such as proficiency at writing or drawing, or arbitrary opinion such as the popularity of an entry among fans.

Check out: Ready to Run a Contest? Laws and What to Include in Your Official Rules

Raffle vs Lottery

A raffle is a type of promotion where participants buy tickets in exchange for the chance to win a prize, which is normally cash prizes. The main difference between raffles and such a lottery is that there will always be a winner with a winning ticket number since all of the purchased tickets are entered into the raffle draw (aside from the free raffle draw).

Raffles may also be considered a form of gambling by regulators given that entrants make a payment of some form in exchange for a chance to win. This is why raffles are limited to non-profit organizations where allowed. As a result, raffles must comply with state and local raffle laws which are different from sweepstakes laws. Furthermore, certain states also prohibit online raffles.

Since regulations for raffles and sweepstakes vary widely across the U.S., it’s essential to review the sweepstakes laws and rules by state to ensure compliance with local requirements.

Compared to a giveaway sweepstake, raffles are not as good for brand visibility as participants might lose all the stakes they invested to the game, but they can help promote your product or service. Some of the benefits hosting a raffle can bring to your company are:

Build a brand from scratch

You can organize a raffle featuring your product as the prize. Giving your product as a prize is a great way to advertise, even on a small community scale. Normally, the prize consists of products of the brand sponsoring the raffle.

Winning Loyal Customers

A themed raffle during popular holidays has the potential to keep customers interested and can turn an occasional customer into a loyal one.

Giveaway vs Sweepstakes

Giveaways’ meaning is simple. A giveaway is a promotion where everyone who enters wins a prize.

People use the word “giveaway” as a blanket term for contests, sweepstakes, raffles, and lotteries, as all of them give participants the chance to win a prize. The term does not clarify whether the giveaway is a game of skill or chance so the “Dominant Factor Test” must still be applied to determine the type of promotion.

Although all of these terms are used interchangeably by the general public, there are clear differences in the eyes of the law.

On the other hand, giveaways and sweepstakes offer similar benefits to the companies or brands that host them. A lot of people thinks that sweepstakes is just another word for giveaway.

One example is door prize games. Normally, these only require participants to answer door prize giveaway questions in order to qualify or enter the giveaway or sweepstakes.

Some of the benefits of hosting giveaways and sweepstakes are:

Lead Generation

Giveaways and Sweepstakes are key marketing tools for companies when it comes to lead generation. This is because of the data the client provides when signing up for the sweepstakes or giveaway. Usually, clients provide information such as name, address, and email in exchange for a chance to win.

For more information on lead generation using sweepstakes check out:  Purchase-to-Enter Sweepstakes: How to Use Receipt Validation for Sweepstakes

Increase Brand Awareness and Good Reputation

Advertising your giveaway or sweepstakes on social media can help grow your visibility. Resulting in more visibility with potential new customers.

Sweepstakes, contests, or games? Which is more popular?

Sweepstakes by far are the most popular promotional tool. Out of 385 promotions, Sweepstakes represent 80% of all prize promotions.

Need help with sweepstakes or contest management? Call 305-505-5393 or email us with your questions.

The post What’s the Difference Between a Sweepstakes, Contest, Game, Raffle and Giveaways and Which is More Popular? appeared first on Sweeppea Blog.

It’s tempting to run sweepstakes and contests more often because they provide a ready list of leads. However, the ability to surprise your customers with awesome prizes is what makes them work.

As as sweepstakes company, the reality is that deciding to run a promotion will depend on a number of factors. Here is how often you should run sweepstakes or contest.

Do You Have Sufficient Resources?

While there is no standard answer for how often you should run a sweepstakes or contest, your decision will largely depend on the resources that are available to you. If you can afford to give away prizes of the same caliber on a regular basis then you might be able to handle running a sweepstakes on a weekly or monthly basis.

How Often Do Other Companies Run Sweepstakes and Contests?

Large companies that sell consumer products in stores across the country might run only a couple of sweepstakes a year if it involves in-store promotions. This is because an in-store promotion requires a significant amount of setup, including the organization of product displays and employee participation.

On the other hand, if the promotion is online only, a company may run a sweepstakes as often as once a month. An online-only sweepstakes or contest is generally only advertised in digital marketing channels, requiring significantly less coordination on the brand’s part.

It’s also a lot cheaper to reach customers since you’ll likely tap into an existing social media audience to find entrants. Online-only sweepstakes also tend to have smaller prizes which makes it easier to do prize delivery to multiple winners. 

What Are Other Brand’s Doing?

Deciding whether to run a sweepstakes or contest or also a matter of choosing to do so when you’re not in competition with other brands for the same sweepstakes or contest entrants. If you notice that another brand in your industry runs contests frequently, opting for bigger and better promotions infrequently might be a better choice.

On the other hand, if you notice that the competition never offers giveaways, then those users are ready and waiting for your brand to share an awesome promotion that they’ll be more than willing to participate in.

Here’s How Often to Run a Sweepstakes or Contest

Keep in mind though that if it happens too often, customers will stop paying attention. A sweepstakes or contest is really only valuable because of its scarcity. 

At Sweeppea, we have a lot of data on promotions run by our clients. After reviewing how entrants interact with promotions over time, we generally recommend twice a year if in-store promotion of the sweepstakes or contest is involved. If a sweepstakes or contest will not require in-store promotion, we recommend launching one once a quarter, if mostly online.

By following these rules, we think that it will help you to keep up an air of exclusivity when it comes to your promotions. At the same time, your customers will remember that you do give away free stuff on occasion!

Need help with sweepstakes or contest management? Call 305-505-5393 or email us with your questions.

The post How Often Should You Run a Sweepstakes or Contest? appeared first on Sweeppea Blog.