Contests are fun, attention-getting promotions if you advertise them correctly. You can set up the contest yourself or use a consultant who specializes in them.
Keep in mind that your prize(s) must be of value to your participants for the contest to work. The prizes should be something they probably wouldn’t buy for themselves or something that is out of their price range.
One thing you can try is scratch-off game cards that offer discounts and free products. Scratch-offs are becoming a fad, and businesses of all sizes can use them. They give the customer a feeling of participating and a chance to win something.
You may be able to get other stores or businesses to donate prizes in exchange for the free publicity. It never hurts to ask, and you may be pleasantly surprised by what you receive. Just keep in mind that when running a contest, you must adhere to the Federal Trade Commission rules and guidelines, which include:
- Ensuring randomness. You need to show that no person or thing can affect the contest outcome.
- Providing full disclosure. You must provide complete contest rules to all participants, as well as the odds of winning (if they can be determined or will be determined by the number of entries). You need to specify how people can participate without buying anything.
- Awarding all prizes. If you award all the prizes you advertise, it’s safer and less of a hassle than trying to explain why you didn’t award all prizes.
- Not discouraging non-buyers. Make it very clear that all who enter have an equal chance to win and that everyone
If you are planning a national direct-mail contest, you need to be sure you’re not running a lottery. Many states still prohibit lotteries, and you’ll also be in violation of postal regulations. A lottery has three elements:
To be sure you’re not running a lottery, you need to eliminate one of those elements, and consideration is the easiest. Legally, consideration means buying something in order to enter the contest. Also, a requirement that a person must be present to win can be interpreted as a consideration.
Why go through all this trouble just to give away prizes? Increases in responses of up to 35 percent are not uncommon to the offers that accompany a contest. That doesn’t necessarily mean buyers, but with that much increase in response, you’re sure to make more sales. Contests also bring attention to your company and may get more people talking about your business. So follow the rules of running a contest, and you could be the big winner in sales and customers.
Whenever you have a contest or a giveaway at your store or restaurant, make a big deal out of the winners. Have the drawing at a time when most people who want to can attend and be sure to take lots of pictures. Send a press release or call the newspapers, radio stations, and TV—if it’s a slow news days, you might get coverage. After all, you can’t get a “no” or a “not interested” if you don’t at least try—and you certainly can’t get a “yes.” Any time you can get your business mentioned in the news, it’s exposure you didn’t have to pay for.