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Is Your Giveaway an Illegal Lottery?
I want to make sure everyone’s running legal giveaways. U.S. law prohibits privately run lotteries. A lottery is defined as a promotion that includes all three of the following elements: prizes, chance, and consideration. If all three elements are present, you are running an illegal lottery, and the federal government can stomp all over your face. Take away any one of these elements, and you’re good to go. Giveaways involve both chance and prizes. What about consideration?
Consideration means that the entity administering the giveaway is receiving a benefit from the method of entry. This is why you’ll see big brands use words like “No purchase necessary” and then offer some other way of entering their contest, like entering by mail. If buying their product was the only way to enter, that is consideration, and would therefore be an illegal lottery.
What is consideration when it comes to blog giveaways? It could be asking people to follow you on Twitter, subscribe to your RSS feed, etc. You are getting a benefit from those methods of entry. (You can put a dollar value to Facebook fans and Twitter followers.) You have to include a method of entry that doesn’t involve asking people to jump through some hoops to benefit you. That is why I have started using a generic question for people to answer in a comment as a method of entry. It’s free. I’m not asking anyone to commit to my blog feed or my Twitter stream. Comment, leave, and maybe you can win. Following me on Twitter can get you an extra entry, but it is not required. That’s how I get around the consideration issue. It’s like how you can mail in a postcard (do those exist anymore?) to enter a contest run by Coca-Cola, but most people are just looking under their bottlecaps every time they buy a Diet Coke or Sprite for more chances to win.
If I’ve gotten some of the above information wrong, and you have an official source like an attorney, please contact me and let me know. I want to ensure that the information I am sharing is accurate!
There’s also a fantastic post by Susan Getgood from last year that says the same thing: The scoop on Facebook contests. I had a video I could transcribe quotes from, but she actually parsed the legalese herself.
And then there’s Leslie from Leslie Loves Veggies who asked Facebook directly, “Can I have my Readers like a Facebook Page for bonus entry into a giveaway?” She got a response from Tamara from Facebook who said: “This is against our guidelines. Per the clause below, you cannot use any native tool of facebook as a method of entry. Therefore, you cannot have users like the page to get bonus entries, there is no way for you to track that nor pull a full list of your facebook fans anyways.”
This post used to give advice concerning Facebook TOS for giveaways… Facebook changed their TOS, so the information I’d written is now obsolete.
This post does not constitute legal advice, and is provided for informational purposes only. If you have legal questions, please contact an attorney.
That’s me: Christina Gleason. I’m a writer, editor, and disability advocate. I'm a multiply disabled autistic lady doing my best in this world built for abled people. I’m a geek for grammar, fantasy, and casual gaming. I hate vegetables. I cannot reliably speak, so I’ll happily conduct business over email or messaging instead.
This is really helpful Christina! Thank you very much for compiling this info. It is dicey and confusing, and doesn’t help that the rules seem to change often. This was very informative.
Colleen Pierre recently posted..Get Mama Organized! Top Planners for 2012
Good post explaining things. People get the details mixed up often or are just unaware of them. I am the same as you – I have a general easy question for my giveaway (sweepstakes) for the main entry. Things like following on Twitter are just EXTRA things they can do if they want.
I would also add that I do see a few VERY ILLEGAL LOTTERIES scattered around – these require people to pay, even a small fee, to enter or to send boxtops for education points to the runner, etc. These are a really big no-no!
Robyn Wright of RobynsOnlineWorld.com recently posted..EasyFeet Fail
Facebook has made things so confusing in terms of giveaways (well, in terms of everything, really) that I just won’t get involved. I never use “liking” as an option of entering my giveaways. And incidentally, not to try to hijack your comments, but I can’t STAND it when a giveaway gives more than a couple ways to enter – leave a comment, sign up for my RSS feed, tweet this, like that, post on your own blog, smack your sister – just give one or two. Otherwise it looks desperate. And when the giveaway has 49 entries from only 7 people, it just looks pathetic!
SelfishMom recently posted..How to get ready to pump gas in Buffalo
There are tools out there that were built with the concept of fixing this issue – one of them being the concept of raffle copter I was on many phone calls when the idea was first being created – I think my main issue was that it 1) took traffic away but 2) never answered the big question to state based rules which are very different.
In the end I see this becoming a major BRAND issue or worst the PR/Marketing teams that allow the contests without rules. I’ve only been told once to remove links to facebook and twitter from a brand as per rules of TOS on either social platform. I’ve done a lot of giveaways.
I know many groups that actually fully encourage the facebook LIKE contests – and that’s just playing Russian roulette with your entire fan base. As with a flick of a switch facebook can turn you off and you could loose one of your most heavily invested marketing tools in the last 5 years.
Moral of the story is – Beware. Be careful. Be Smart.
For a few hundred dollars its worth having a 3rd party host that facebook contest. Heck for a few hundred dollars you could pay for your own system to host and run those giveaways.
DaDa Rocks recently posted..Happy Holidays from my family to yours and a few last minute gift ideas to make wives happy
Since you asked for my feedback, I’ve always been pretty outspoken about this stuff: At Cool Mom Picks, we don’t promote illegal Facebook contests for brands or blogs, and we don’t hold them ourselves. This has been the very clear TOS for two years now – Susan Getgood has been writing about it quite clearly since early 2010: http://getgood.com/roadmaps/2010/06/09/the-scoop-on-facebook-contests/
(She’s my guru on all things social media/FTC!)
As for the jumping through hoops thing, I’ve always found it rude. One little thing for an extra entry, sure. But otherwise, it’s kind of a joke to see lists of requirements that are longer than the actual “review.” I also don’t believe it increases your traffic or followers–doesn’t it tend to be the same small group of contest entrants who are willing to do 47 thing to win something? And then, it doesn’t really benefit the brand either when you’re only attracting folks who want freebies; but that’s another story.
If you host giveaways, I’d strongly suggest running your contest rules through an attorney and posting them on your site. You need to give people a way to enter that doesn’t involve the internet, for example. Which is hilarious, considering without the internet, they probably wouldn’t see it in the first place.
Ah, lawyers. Gotta love them.
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Thanks for linking Kontestapp.com Christina 🙂 Anyone can create sweepstakes with Kontest and be sure to comply with Facebook promotions guidelines! Happy new year!
You are correct if you mean that “Liking” a page on Facebook cannot be THE method of entry. That is, “Like ______ on Facebook to be entered to win.” Someone cannot be automatically entered into a giveaway by Liking a page.
I really don’t get why this is so confusing to so many. You CAN have people like your page (or a sponsor’s page) as an entry into a giveaway. The caveat? Their entry has to be submitted in ANOTHER manner….not just by liking. That means on your blog, in a comment, via Rafflecopter, via Google Docs, etc.
You stated: “You’ve got to create your own means, your own entry mechanism.” Facebook recommends using a field asking users for their names, email addresses, or other information, but you cannot use any form of Facebook functionality as a method of entry for your promotion. This means you cannot ask people to like your page, comment on your wall, upload a photo, etc. as a method of entry.
I don’t know where you get that you can’t ask people to Like your page at all. It just can’t be their METHOD OF ENTRY. This language is key. You have NEVER been permitted to ask people to comment or post to walls. That has long been a portion of the FB TOS, as they state you cannot condition entry on a user “creating content” on FB. Asking them to post a status or comment on a wall would be “creating comment.”
This has been hashed, rehashed and over-hashed. And, unfortunately, there are too many people who do not understand legal language but think they do. Then they write blog posts that are misguided and ill-informed (there are plenty)…and it confuses the entire issue again.
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Have you had a lawyer evaluate your interpretation of the legalese? I admit that I haven’t. But I’m strongly considering doing so because I haven’t gotten a personal response from Facebook on the matter yet.