Karie Herring of TheFiveFish.com has written a response to our post on giveaways being rigged. She suggests that most giveaways mom blogs host fall under the sweepstakes category, which has federal and state laws that govern how they ought to be run.
The giveaways we routinely see happening today may at some point be barred and slapped with the “illegal lottery” label – which are highly regulated and fined in the U.S.
We decided to look up the rules and found Karie has some valid concerns. The stickiest point is the method for entering a sweepstakes – under federal regulations there are several major no-no’s including: (i) requiring purchase – which is why you always see “no purchase necessary”; (ii) asking for disclosure of unnecessary personal information; (iii) requiring extensive navigation of a website; (iv) acceptance of future advertisements for entry or (vi) anything falling under the category of consideration.
The key point here is that it has to be very simple for anyone to enter and you cannot require something that is beneficial to the sponsor (or host). Any unneccessary barrier or benefit would change it from being a sweepstakes (which is based entirely on chance) to being an illegal lottery.
It’s common practice for bloggers to give extra entries for things like subscribing to their RSS feed, tweeting about the contest, finding a product on the sponsor’s website they like, hosting giveaways on private sites, or requiring an answer to a sponsored trivia question. However, if giveaways fall under the sweepstakes category then requiring any of the above is illegal – and although bloggers may not be fined yet, we as a community should be proactive and consider the kinds of policies we want to promote as best practices for our industry.
There were some great suggestions on our original post about the best ways to select winners – including the verified draw system on Random.org, which starts at $4.95 and would prevent any accusation of bias. That sounds like $4.95 well spent. (And yes, bloggers could require companies hosting giveaways on their site to provide them with a third-party drawing service.)
These laws are not common knowledge, so this is not an indictment on individuals but rather a collective call to action for us to all do better.
We hope this ongoing conversation inspires us all to consider what the best practices for giveaways ought to be. Lots of us have made mistakes but those choices don’t have to define our community if we choose to improve and opt to better self-regulate.
Perhaps the Blog With Integrity folks should facilitate a wider discussion and help set some industry standards.
{photo credit: Muffet}
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great post!
All of my give-aways require only a comment…nothing extra, no other “work” on the reader’s part. That’s the way I think it should be done on every site. Thanks for posting.
I wrote about this issue in 2007
Here’s the link: http://getgood.com/roadmaps/2007/10/03/contests-sweepstakes-prizes-liability-oh-my/
Thanks for writing about this. I am thinking about having my first giveaway, and this has given me some insightful reminders.
I have stopped entering a lot of giveaways….if they require a rss subscription or google follow, and I honestly don’t plan on reading their blog, then I don’t enter. I don’t have time to have their stuff clogging up my reader, and I don’t want to be just another number upping their “stats” it all feels a little yucky to me. If a blogger is writing good content, people will subscribe and follow them because they want to come back…anything else is just buying a “follower” who never stops by and doesn’t care about you or your blog. Why would you want that anyway?
Thanks for giving me yet another reason to not do giveaways. I’ve only done a couple and they’ve been a pain in the butt. Plus they really didn’t get me many extra readers. I’m just banking on writing good content.
There is also the ‘new to me anyway’ rule about using Facebook in giveaways.. there are clear written guidelines from Facebook about never making it a ‘requirement’ to fan or friend via Facebook for a sweepstakes.
You may however have it as an ‘extra’ entry option. (Don’t ask me where it is, srsly it took me hours one day and lots of twitter ppl helping me to locate that statement on the Facebook guidelines!!)
In the reading I’ve done (and holy wow, it’s hard to find and then read through any legalese of mumbo jumbo about sweepstakes!)
But, I thought it was fine to have ‘random’ entry via commenting, and then ‘extra’ options as well?
And isn’t there another funny name for giveaways that require a photo submission or some sort of essay submitted for judging? Instead of sweepstakes they are called skilled contests or something? And they also come with their own giant set of mumbo jumbo legalese.
My suggestion to bloggers is to ask the company you are dealing with for a short paragraph you can use at the bottom of your giveaway post.
There is the whole Canada issue separate from the American legal issues to deal with as well…
And the one I can never figure out is ‘void in Maryland, Rhode Island’ etc… ?? What does that mean, they can’t enter, or they can’t win or what??
Thanks for posting this, I was not aware of the sweepstakes rules. I am not a giveaway site, but do run probably once a month. I am writing up something now to send to companies who inquire about a giveaway- including the fee for the third-party draw.
Thanks
Emily @ Busy Mom
Wow, we definitely did not realize how allowing readers to have extra entries caused a problem. We’re going to remove that option immediately.
Thanks for letting us know.
It is very important that we as a community try to work together to ensure we’re all following best practices.
You should check out this post http://contests.about.com/od/sweepstakes101/p/whatarecontests.htm
It says bloggers are not breaking the law or conducting illegal lotteries by conducting the giveaways the way we do. You should also consider and vet the sources you base your exposés on before you post them.
Are you sure you read that artcile you cited? I too read that article on about.com, and it actually backs up what is said in this post; specifically, it says that there are three types of “giveaways” – lotteries, contests, and sweepstakes. Private lotteries require purchase to enter and are strictly regulated; they would be considered illegal if a blogger were to run one. Contests award prizes based on some merit (so, a recipe contest, poetry-writing contest, or other such thing would fall into this category). Sweepstakes are what most bloggers hold. The article goes on to say:
“The U.S. has strict laws barring private lotteries. A lottery is a promotion that has three elements:
1. Prizes
2. Winners Chosen by Chance
3. Consideration
To avoid being classified as an illegal lottery, sweepstakes must ensure that at least one of these elements is missing.” Since every sweepstake I’ve ever seen on any blog has the first two, it must be missing the third, “consideration”. The article defines “consideration” as being “anything that can profit the sponsor.” The definition of “benefit” (as well as, possibly, “sponsor”; would the blogger be considered the sponsor as well, or would it just be the company providing the prize?) is what’s fairly murky; some jurisdictions (according to this same article) have even determined that restricting entries to computer-based methods (such as entering a comment on “consideration”, because ownership of a computer and ISP service are required. Allowing mail-in entries is one way around this.
So ultimately, this is still a very much undecided topic, and one that bloggers probably do need to consider before running sweepstakes.
Thank you for all this information. After doing my first two giveaways with “extra entries,” I think I have been persuaded to go with the one entry only requirement.
I don’t think it is fair however, to consider personal blog giveaways to be treated as a sweepstakes if it is ONLY a personal blog and not part blog/part business.
There is a business blog I want to work on in the future and I can accept that being treated as such!
Thank you for this information!
We were just talking about this on a Philly Forum Recently! My giveaway this week will be the last I do all of that! Email entries here we come! That’s easy :p
This is a great topic for discussion and a HOT one in many forums recently. My blog is new and so are my giveaways but I have already experienced resistance when readers are required to do MORE than just comment. As much as I don’t favor regulation I still would like to see some consistency among blog giveaways.
Wow. This is so interesting. I had absolutely no idea. I will certainly reconsider how I run giveaways from now on!
I’m with Lolli on this one. I usually have a huge Target giftcard giveaway every few months. They aren’t sponsored and it comes out of my own pocket, however, in trying to make things interesting and letting my readers get to know me (I ask trivia questions, sometimes, based on previous posts), I guess this might be a no-no. Interesting.
This is a great article – this had NEVER crossed my mind before!
This article speaks specifically to US laws, but does that mean that only US citizens living and blogging in the US are required to follow these rules? I live in Canada, but occasionally have giveaways that are open to the US as well, so I’m curious to know what it means for me.
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