Giveaways, Sweepstakes and Contests for Bloggers and Brands
Next Crackdown on Bloggers: Sweepstakes & Contests
Next Crackdown on Bloggers: Sweepstakes & Contests
by

I’ve been really angsty of late, worrying about things I shouldn’t worry about. That’s the life of a Jewish mother, I suppose. But it’s also the life of a social media marketer who is valiantly trying to stay on the right side of the law. The FTC law, that is.

No doubt most of you are aware that the FTC (Federal Trade Commission) regulates advertising and marketing practices here in the U.S. They’re the governmental group who has brought us the CAN-SPAM act (email marketing), COPPA (Children’s Online Privacy Protection Act) and, more recently, their Guides Concerning the Use of Endorsements and Testimonials in Advertising, which helped to bring about a more open and transparent level of disclosure by bloggers about their relationships with brands, organizations and events.

The FTC is also one of the governmental bodies which regulates Contests and Sweepstakes (others being the Postal Service, the Department of Justice, and regulatory bodies within each of the 50 U.S. states).

I’m on the verge of losing sleep because of the FTC. It’s because I get upset every time I see something like this in a blog post:

The Wrong Way to Do a Blog Giveaway

What’s wrong with this picture? Well, just about everything. This “giveaway” is actually a sweepstakes and, as such, it violates U.S. and state regulations in about a half-dozen ways, not to mention Facebook’s Promotions Guidelines as well.

The bigger problem? That there are hundreds, if not thousands, of these “giveaways” on blogs each and every day. (Shhh. Jason is doing one right here!) Don’t you think that at some point the Feds, or one very consumer protection-oriented state (like my own state of New York), are going to sit up and realize that bloggers are mostly doing this wrong? And what’s going to happen to the brands whose stuff is being given away in these “giveaways?” Just as with the Endorsements guidelines, the burden is more likely to be on the brands than the blogger to make sure that every giveaway they are involved with is being run in a manner that complies with federal and state guidelines.

So what’s a brand (or blogger) to do? It’s really not that complicated, you just have to be sure your sweepstakes (or contest) is run according to the FTC and state guidelines. My friend Sara Hawkins, an attorney-turned-blogger, has written a handy post with key points of the sweepstakes guidelines. Based on Sara’s post, this really great post from the Keller and Heckman law firm, and my own understanding of the guidelines, here are the definitions and rules you need to know:

Type of Promotion

A Sweepstakes is a giveaway where winners are chosen at random.

A Contest chooses a winner based on some merit: best photo, funniest tip, etc.

A Lottery is a prize drawing where people pay money for a chance to win. Lotteries are even more highly regulated and brands (or bloggers) should never run a lottery without strong legal guidance.

Thus, most giveaways are actually sweepstakes: a winner is chosen at random based on an entry (like leaving a comment).

Sweepstakes Prize Value

Sweepstakes prizes valued over $5,000 must be registered and bonded in the State of New York and Florida (so don’t offer prizes over $5,000 unless you have the time and money to register and bond your sweepstakes).

Any prize over $600 is required to be reported to the Internal Revenue Service (IRS). (The reality is that bloggers must pay taxes on anything they receive with value over $25, but that’s another story entirely.)

Official Rules

All sweepstakes and contests must have Official Rules associated with them, prominently available to the entrant (attorneys I’ve spoken to always prefer that an entrant must check a box to say that they’ve agreed to the Rules, though I’ve also been told that if the rules are prominent enough and verbiage says something like “by entering your name below you are agreeing to the Official Rules” you may be covered.

Key points for Official Rules:

  • Must state “NO PURCHASE NECESSARY”
  • Must include eligibility requirements (age, residence – it’s generally problematic to include entrants under the age of 18 in your sweepstakes, and, given that every country has its own requirements for promotions, it may be wise to limit entrants to U.S. residents only)
  • Duration and deadlines (when does it start, by what date must you enter, etc.)
  • Entry procedures (Can you also enter by mail? What, specifically, do you need to do to enter?)
  • Prize descriptions (very specific – including an approximate retail value of the prize, if no actual retail value is available)
  • Odds of winning (this may be “The number of eligible entries received determines the odds of winning.”)
  • How a dispute or mistake will be handled (disclaimers for technical failures or typographical errors; identity disputes related to the winner)
  • How and when winners are selected (you must set a date for winner selection and also for how long winners have to claim their prize)
  • Right to obtain winners’ names and how to do so, as well as the right to publicize their names and likenesses (if for whatever reason you’re not collecting their name on entry, you’ll want to get their name when you certify them as the winner; at the same time, you’ll probably want to have the right to use their name and photo for promotional purposes)
  • Method of distributing prizes not claimed (often something like, “If potential Grand Prize winner forfeits or does not claim the prize, prize will be re-awarded, in Sponsor’s sole discretion.” and “All prizes will be awarded.”)
  • Liability release (this holds the company harmless in the event that the prize or sweepstakes in some way negatively impacts the winner; this is often done alongside the certification of winner, where the winner must furnish proof of identity, address and birth date to win the prize, and at the same time sign the liability release)
  • Sponsor name and contact information (mailing address at the very least, plus email address and/or phone number)
  • Legal venue (in what state or jurisdiction is the sweepstakes being regulated in?)
  • Also state “VOID WHERE PROHIBITED BY LAW”

Additional Info for Contests

Most of the same rules and requirements apply to contests, with a few additions.  If you’re running a contest where you’re collecting any materials from the entrants (photos, essays, artwork, poems), you should state how those materials are to be used and returned (if at all). As well, it may be necessary to restrict photos to images of people over 18 (to stay on the right side of the COPPA laws) and also to state that any inappropriate materials will result in automatic disqualification (be sure to define “inappropriate” for your specific contest).

If you are running a contest, there’s another whole discussion your lawyers will want to have about voting for the winner vs. judging the winner. Go ahead, ask them. Double-dare you. It’ll be a long discussion. The upshot: lawyers don’t like voting on contests. So make the final winner selection based at least 60% on judging by an “expert panel” vs. voting by regular people. Or vote for round one, then have the panel pick the winner out of a number of finalists. There’s too much randomness in voting, which makes it a sweeps vs. a contest. Lawyers don’t like it when lines blur like that, you know.

Advertising the Promotion

If the “giveaway” is to be referenced in any other place besides the actual sweepstakes page itself, there are additional guidelines for advertising that apply. Each reference to the giveaway must state the eligibility requirements (age, location), deadlines, how to obtain Official Rules, and must also include the two phrases “NO PURCHASE NECESSARY” and “VOID WHERE PROHIBITED.”

Children and General Privacy

I’ve referenced COPPA law a couple of times now, and can’t state emphatically enough how important it is to steer clear of the issues related to marketing to children under 13. However, a few states, such as Maine and California, have recently written new laws governing the collection of personal information for minors under the age of 18. Given that state laws vary on this point, it’s far safer to restrict your sweepstakes or contest to those over 18, and to require proof of age for winners upon certification of the winners.

Additionally, your sweepstakes or contest should either include or reference a strong privacy policy which governs your use of their personal information, including whether or not your site collects cookies, and with whom you will disclose or share their information.

Facebook: A Whole New Can of Worms

Facebook adds a whole new additional of complexity to promotions with their promotions guidelines. Sara has a good round-up here; the basics on this are that you cannot use any of Facebook’s native applications to enter people into a contest. Native applications include the Wall, the Like button, photos, videos and using Facebook to notify winners. Meaning, in the really bad example above, requiring people to “friend” someone (or “Like” a page) in order to gain an extra entry into the giveaway is not allowed. This is a topic for a whole other post, and many people have already written it, so I’ll just suggest you Google “facebook promotions guidelines” and you’ll get an earful. Or eyeful.

In short, “giveaways” are nothing to mess around with casually. There is no such thing as a “giveaway,” they are all sweepstakes, and, as such, are governed by myriad federal and state laws to which attention should be paid. If you’re a blogger who runs giveaways the wrong way, I really hope this post gives you pause: please step back, evaluate, and decide if running the giveaways brings you enough monetary value to either a) hire an attorney to help you setup your giveaways correctly, or b) to fight a lawsuit if a disgruntled non-winner (or winner) decides to take you to task for not following the law. If you’re a brand running giveaways via bloggers, it truly behooves you take control of the situation for yourself, and to sic your attorneys on this matter immediately.

Now go forth and giveaway. Properly. This angsty Jewish mother thanks you.

DISCLAIMER: I am not an attorney, nor do I play one on TV. The information provided herin is not legal advice and is only based on my own experiences as a marketer with sweepstakes and contests, including counsel I have been given by numerous attorneys over my many years as an internet marketer. None of the above should be considered a substitute for you consulting your own legal counsel who will guide you and your company (or blog) in how to create and manage sweepstakes and contests.

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About the Author

Stephanie Schwab
Stephanie Schwab is the Principal of Crackerjack Marketing, a digital marketing agency specializing in social media planning and execution. Stephanie is also the founder of the Digital Family Summit, the first-of-its-kind conference for tween bloggers and content creators and their families. Throughout her 20-year career, she has developed and led marketing and social media programs for top brands and has presented on social media and e-commerce topics at numerous conferences and corporate events. Stephanie writes about social media at CrackerjackMarketing.com, sometimes hangs out at Google+, and tweets @stephanies.
  • Marc David
  • Thanks Stephaine for sharing an informative post.

  • you literally cover everything about sweepstakes here. A lot of people aren’t aware about filing their sweepstakes taxes on winnings over $600. Great article

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  • MckMunchausen by Proxy

    How can one report a blogger who consistently doesn’t follow the rules with respect to contests or giveaways?

    • I would suppose you could email or call the FTC or that blogger’s state Attorney General. But I’m sure those types of outreach probably fall on deaf ears most times. It might be more constructive to politely let the blogger know they might be violating the law/guidelines out there by sending them to where the rules are posted.

      • Peter

        Turn in a blogger for doing what hundreds of them are doing all over the Internet? You would have to turn everyone one in to be fair if that is the real point of this article.
        But most of all, the giveaway referenced in this article is doing something bordering on the criminal, the value of that giveaway involves tax law, that is something that gets the government quite riled up. I still don’t understand why that wasn’t the scope of the article.

        • Peter

          Sorry, the giveaway I reference is the one on this site by Jason, referenced in the beginning of the article  See above – (Shhh. Jason is doing one right here!)

        • The point of the article was to help bloggers understand that doing a giveaway or sweepstakes is not as simple as just doing it. We weren’t diving into tax law and assuming the people violating these guidelines are doing something sinister. I would bet in most cases it’s done out of ignorance. We were just trying to be informative.

          • Peter

            And yet some folks respond looking for a “witch hunt.” I appreciate that you thought you were trying to be informative, but the slant of the article conveyed a negative feeling for me and I think the majority of the responses bear this out. I personally welcome the assistance, I updated my disclosure immediately. Ultimately I think the focus of the article was incorrect because tax implications do not arise until you hit the $600 threshold. Blogs giving away stuff under that amount would not raise any red flags with any regulatory agencies, per se. In my humble opinion.

    • Peter

      A blogger? This is a format used by hundreds if not more. Why not ask that question of Jason referenced below where tax law is involved?

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  • What I don’t get is, why is it so complicated?  Why are all these rules in place anyway?  so much for land of the free more like land of the over regulated.  I am sure it is all for our protection in some way but, wow makes a simple thing very complicated. Makes me rethink doing giveaways and I love doing them. Thanks for the info

  • This is a great post. I also think it is a great example of why bloggers should not be conducting “giveaways” for free. This should be a paid service and should follow what you have outlined. Just like how some PR firms are now providing discloser terms to be used in the post “giveaway” policies should be part of the contract between the PR firm and the blogger. Yes this is a lot of work which is why PR firm might want to work with companies like Collective Bias and Clever Girls which would allow them one legal contact for a network of bloggers. 

    • Kelly, I completely agree that bloggers who work through a blogger agency should be in better shape, legally, but it’s still up to the blogger to dot their “i’s” and cross their “t’s” to make sure the legal is working in their favor.  Some “agencies,” and particularly those run by bloggers who don’t have a background in digital marketing, are also not 100% aware or compliant with the laws and therefore they are helping bloggers to run afoul of the law too.   So blogger beware, check out who you’re working with before you assume they’ve done all the research for you.  

      I believe the burden shouldn’t rest on the blogger (or blogger agent): brands or their agencies should be doing the legal work and spelling out how they want the bloggers to behave. They’re the ones reaping the benefit of the bloggers’ work (paid or unpaid), and they have the legal teams already in place.

  • I have been saying this for years and using it as the reason for why I’m not comfortable doing giveaways on my blog. I have succumbed to pressure and done a couple, but you’ve just reassured me that I was correct in my assumptions. Add state law on top of this and I’m more than happy to say, “No thank you” for the minimal exposure it gives my blog to do a giveaway.

    • Moomettes

      About 6 months ago I’ve also essentially stopped doing Giveaways on my blog.  While I have always had an Official Rules page prominently displayed that sets forth the majority of the points referenced here, the fact is that hosting and promoting Giveaways properly is time consuming.  Add another level of regulation, and a blogger must seriously reassess the cost/benefit ratio of their time.

      • @twitter-14101678:disqus and @ccd47fa2b3dbf65f6b28c4b5fb2efbe1:disqus you are both so right. And frankly, I think the vast proliferation of giveaways is damaging to both blogs and brands: cheapening blogging to something that is entirely commercial, without the storytelling or lifestyle component, and cheapening brands who are willing to giveaway product through bloggers without fully vetting them as the best spokespeople for their brands. So if awareness of these rules mean fewer giveaways run by bloggers, I say hooray! Let’s bring blogging back to what it could (and IMHO, should) be: storytelling and resources, not simply crass commercialism.

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  • Thank you for the information. My opinion after reading this post is that finally this way to promote is quite difficult. Since i’m not a “professional blogger” the time i had to spend organizing this is much more than the time i can spend for my blog. Furthermore there are many legal issues and for an armature blogger like me i don’t think that finally this will work easily.

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  • Blossom

    Lottery is also defined as any scheme for the distribution of prizes by chance (and doesn’t include money).

  • Peter

    Could you have used the giveaway on your own blog by Jason as an example instead of singling out an innocent blogger who has simply copied a form that hundreds, if not thousands, of bloggers have been using (not that that makes it correct). It would seem less like an attack and more like a discussion. I don’t see the contest on this web-site/blog following the guidelines that you posted. Please advise.

  • Gaynycdad

    This is great information.
    I do get the feeling that there are no exact guidelines to govern this sort of thing so there is no definitive as to what is the most correct way for a blogger to run a giveaway/contest/sweepstakes (unless a lwayer can explain which terms are legal or illegal to use, I am not sure who should be dictating this information).
    I do have to say I find it cowardly to post someone’s information without contacting them first.

  • I’ve been hearing so much talk about and stress about hosting giveaways and rules that I figured this was coming…

  • This post is an excellent example of how we have allowed the simplest things in life to be turned into a nightmare of ridiculous and totally unnecessary nonsense. There are too many laws and most are enforced by prosecuting a few high profile cases to scare the majority of people into compliance.

    Now that they’ve managed to pass laws imposing up to a $1 MILLION dollar fine for not complying with the latest outrageous law that makes planting a garden or sharing your food a nightmare of red tape, I’m more concerned about going hungry than I am about giveaways.
     
    That people are finally saying enough means just maybe there is hope for a return to some common sense. Do you realize that if we really wanted to be “safe” from prosecution we could never do anything because of fears of liability?

    The bottom line is no matter how law-abiding you try to me you are STILL vulnerable. Anyone can sue you whether you did anything wrong or not and whether they have a case or not. The government can come after you whether you are guilty or innocent – and today we are all automatically guilty.

    Troy Davis was just executed in spite of overwhelming doubts about his guilt including no physical evidence and 7 of 9 witnesses recanting and admitting they ONLY said he did it because the police threatened to pin the murder on them instead if they didn’t! Being innocent won’t save you, either.

    Recently, police have admitted that they regularly plant evidence to meet their quotas and their superiors either directed them to do it or are aware and look the other way. Corruption is rampant. Isn’t it about time we did something to get our country and freedom back instead of living in fear that we might have the FTC coming after us for giving away some trinket?

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  • Barefootambisiosa

    This is one helpful post, even the comments are helpful. Thanks!

  • One of the biggest issues is “Consideration” in a random drawing win- which basically means asking someone to do something that requires a lot of work like tweeting, entering a photo/video, etc.  The way to make that OK is to have an alternate form of entry like a postcard write-in. 
    But, you are so right about official rules.  You’ve got to have them and it’s good practice to ask a company if you are doing the giveaway on their behalf, to provide them.  The blogger shouldn’t be on the hook for basically providing a service to a sponsor.

    • I agree, it would be great if the company were responsible for the rules. Bloggers should ask for them. And if a brand can’t provide them….the blogger should walk away. Great point!

      • If you have a Twitter account, a tweet is a LOT less work than sending a postcard. To do that would require going to the store, buying a postcard, going to the post office to buy stamps, writing the message, mailing address and return address on the postcard, and then taking it wherever you have to take it to mail it.

        I don’t remember the last time I even saw a postcard and I haven’t mailed anything or bought stamps in years.

  • Actually you “like” on facebook as an extra entry. I a worker at FB that deals in that area came into a private forum that I’m in and told us all that it’s allowed. It just can’t be mandatory.

    • Alison, see below for my comments on the comments from Misty Marsh. I know people are using Likes for entries and I have heard conflicting reports about whether Facebook allows it, but overall, it seems to me that it’s against FB’s rules.  I would therefore never counsel a client to include Likes as a condition for entry (or extra entry).  But do whatever you and your attorney think is right….I’m not a lawyer and am definitely not the be-all, end-all authority on this. 

  • I am sooo glad that I’m not the only one that worries about this concept!
    I have a small blog… and while I’d love to reward my readers, I’ve always hesitated to host giveaways, partly because of the gray legal questions you bring up. My blog is not big enough to attract large prizes or to warrant paying out for a lawyer to write my terms and conditions. So write now, the risks and time involved for a giveaway outweigh the potential benefits. Thanks for writing about this topic.

    • Shannon, if you’re worried too, you’re with me in the minority, it seems. Glad you’re staying on the right side of the regulations, I think you’re smart to do so.  Thanks for reading and commenting!

  • Great post! This is what I have been trying to tell bloggers for at least 2yrs. It is so important to know what the legalities are of running any form of “giveaway”. Thank you!

  • Sunil Sharma

    Thanks for wonderful information but I am unable to understand that what we should do if we won a software, plugin or anything else instead cash prizes. Similarly if I want to organize a giveaway on my site and I am not a US resident, it is essential to registered it with US authority to organize a giveaway of US$ 100 or less.

    • Hi Sunil:  I’m afraid I can’t comment on anything outside of the U.S., I have no idea what other laws or regulations are.  I hope you can find an attorney in your home country who can help you run giveaways legally within your rules.

    • Sunil, giving away something digital definitely opens the door to many more people because it can be fulfilled with just an email or a download link. However, the challenge is to comply with the laws of the various jurisdictions of where contestants may be located.

      If you want to target US residents then you’d follow the US laws. That, though, would be to the detriment of readers from other countries as the laws of other countries may run counter to US laws. 

      If you want to offer the prize to a resident of your country, as Stephanie said, find a lawyer in your country knowledgeable on this topic. It may be a challenge if the laws are not well-established but then you’d have a better understanding of what is required.

      Best wishes,
      Sara

  • Shelli

    I’ve always been wary of the “giveaways.” They seem like basically “Shilling” for a company in order to get a bigger hit count on your stat page.

    • No question, giveaways are a bit murky all around. Maybe some scrutiny to the whole thing will clean it all up a bit. It’s really getting ugly out there.

      • If a blogger is honest about their relationship with whatever they are giving away how can anyone call that shilling? Wikipedia definition: “A shill, plant or stooge is a person who helps a
        person or organization without disclosing that he or she has a close
        relationship with that person or organization. Shill typically
        refers to someone who purposely gives onlookers the impression that he
        or she is an enthusiastic independent customer of a seller (or marketer
        of ideas) that he or she is SECRETLY working for”.

        The key is honesty and disclosure. If everyone knows it isn’t murky. I do not understand why people want the government involved because that just makes things worse. Name one thing that the government does well. When was the last time you got wonderful service from the DMV or the county tax assessor or the post office? 

        We have been conditioned to trust the wrong entities and fear the wrong things in life, but we have the choice to see clearly IF we choose to do so.

  • RobinD

    This is definitely an post to bookmark. Thank you for the clear definitions & outline(s).

  • This post has been eye opening.  I have many things to change about the way I do giveaways errr sweepstakes :-)  However, I’d like to point out that you ARE allowed to require a facebook like as an entry.  This is a quote from the FB promotion guidelines.  “You must not condition registration or entry upon the user taking any
    action using any Facebook features or functionality other than liking a
    Page, checking in to a Place, or connecting to your app. For example,
    you must not condition registration or entry upon the user liking a Wall
    post, or commenting or uploading a photo on a Wall.”  It says you can’t require anything OTHER THAN….. 

    • Stephanie,

      I would love to hear your response to this comment.  I have run giveaways on my blog, but was unaware of many of the things you mention here.  While I’ve never read your work before, I like the clear, professional manner in which you’ve addressed the issue here in this post.  I will be making significant changes to future giveaways.  However, I, like Cricket, understood the facebook policy to mean that liking a page was allowed.  What am I misunderstanding and do I have other options?  Thanks!

      • Misty, Cricket, Liz….I’m still not a lawyer and don’t work for Facebook either so can’t give you a response without stating that anything I say is basically useless. :-)  However, my understanding is the same as what the Facebook employee said on Leslielovesveggies: that using any “native” Facebook functionality to permission or condition an entry into any kind of promotion is against their Terms of Service. Additionally, attorneys I’ve worked with have all steered well clear of anything on Facebook that does not run through a third-party app (like Wildfire or North Social) which removes the need to use Facebook’s native functions.  Yes, it may seem like all the cool kids are doing it (using Likes for entries), but I would never suggest that a client do so. Why risk it?  Facebook has shut pages down before, they’ll do it again.

        • Thanks Stephanie.  I will check out the third-party apps you mentioned.

    • Liz

      Actually, it’s against Facebook policy. Just read this post the other day that includes a response from a Facebook employee – http://www.leslielovesveggies.net/2011/10/liking-on-facebook-facebook-guidelines-say-no-i-have-confirmation.html

      • Regardless of what the e-mail in the post at Leslie Loves Veggies states, their policy online is very clear that liking a page is an acceptable entry.  Until such time as they change their policy it’s completely legal because that is the policy that has been published for FB users, not the e-mail response. I’m not a lawyer of course, but would recommend taking a screenshot of the policy everytime a blogger runs a giveaway to prove that they were within the published guidelines at the time of the giveaway start.

        • That is excellent advice, Cricket. I have run into conflicting “rules” on Facebook including one somewhere that I haven’t been able to locate again that says if you claim a page name that is generic they can freeze or delete your page. As far as I have heard they are not enforcing that – YET.

    • Cricket,

      You’re misreading the FB Promotion Guidelines.

      #3 – You must not use Facebook features or functionality as a promotion’s registration or entry mechanism. For example, the act of liking a Page or checking in to a Place cannot automatically register or enter a promotion participant. 

      You can see from term 3 of the guidelines that using Facebook functionality is prohibited as a means of entry.

      #4 – You must not condition registration or entry upon the user taking any action using any Facebook features or functionality other than liking a Page, checking in to a Place, or connecting to your app. For example, you must not condition registration or entry upon the user liking a Wall post, or commenting or uploading a photo on a Wall.

      You’re actually reading this provision and this one specifically relates to using a 3rd party app that ‘Like gates’ accessibility to the app. In using a 3rd party app, one can require someone ‘Like’ the Page in order to gain access to the 3rd party application being used for the promotion.

      These are 2 separate provisions are related to different concepts. That’s the challenge with these guidelines. Not everyone is a lawyer or reads things with a legal understanding, nor are they FB employees who have been trained in this topic.

      So, in fact, asking for a “Like” as a means of entry is prohibited by the FB guidelines. The FB guidelines are NOT laws so they are not incorporated into the sweepstakes laws Stephanie mentions. However, when using the Facebook platform you must also follow their terms and conditions which may be contrary or in addition to laws.

      Hope this helps clarify things.

      Regards,
      Sara

      Sara at Saving For Someday (yes, the one mentioned in the above article)

      • LOL, I will respectfully disagree with your statement that I have misread them, and respectfully say that you misread my remark.  I stated that you can require, not use a facebook like (meaning fanpage).

        Per #3 above, one cannot use an actual “like” to be an entry into a contest- meaning a blogger cannot take all fans of their page and enter them into a contest simply because they “like” their page.  A person would have to actually enter the contest themselves (by leaving a blog comment, filling out a google form, entering on a rafflecopter) Per #4 you can use that “like” of a fanpage, but not a like of a specific post. 

        The giveaways I have run in the past on my blog have used a fanpage like (#4) as the entry requirement, but the fans would enter the contest (#3) via commenting on the giveaway post, filling our the google doc, or clicking the “I did this” on the rafflecopter.  I have been completely in compliance with FB rules.  I do however, need to take the advice on this article and have much more in depth rules for each giveaway that I do.

        • Cricket, 

          Your exact words in your comment are: However, I’d like to point out that you ARE allowed to require a facebook like as an entry. 

          I did not misread that.

          Requiring a “Like” as an entry is not permitted per the Facebook Promotion Guidelines.

          As you have then stated in your followup, entry is actually the 2nd part – commenting, filling out a form, clicking through a 3rd party app.

          This post by Stephanie is NOT about the FB promotion guidelines, though. Complying with Facebook is not the equivalent of running a proper promotion (whether it is a sweepstakes or a contest).

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  • Christina Anne Lucas

    Wonderful post! I have a lot of readers on The Blog Entourage who either host giveaways or own etsy shops and do giveaways. I would love to host this as a guest post at theblogentourage.com if you’re interested.

    • Hi Christina: Feel free to email me stephanie AT crackerjackmarketing DOT com and we’ll talk; I don’t want to repost this exactly but perhaps can write something for your readers. Thanks for asking!

  • Very informative.  Question:  Can you have a separate page with the Official rules that are the same for all giveaways and then just reference a link to them in each one you do?  That would help with limiting the long legal mumbo jumbo on each post. 

    Also, with facebook – if you don’t use it as a mandatory entry to like a page can you still do it?  Or does it not matter?  

    • Hi Daria! I’m not an attorney so can only tell you what I know from my experience: that boilerplate Rules are generally not enough to satisfy attorneys. Each sweepstakes will have its own dates, deadlines and prizes and therefore necessitates a new set of rules. In practice, however, you could create a single URL on your website and then swap out the new Rules for each contest (therefore not creating a new page every time).  As for the mumbo jumbo on each post, see above under “Advertising the Promotion” for what you ALSO need to include (each sweeps should have the basics of the contest outlined within the body of the post, then you can reference the rules with a link).  Again: I’m not an attorney so please contact yours to verify all of this, don’t take my word for it.

      On Facebook, not sure what you’re asking.  But regardless of what you are asking, my advice is probably the same: always use a third-party app (Wildfireapp.com, NorthSocial.com, etc.) to run any kind of a promotion involving Facebook. And you also do need to have clear Rules.  All third-party apps for sweepstakes will also require you to input your own Rules created by you and your attorney.

    • Daria, I agree with Stephanie that having blanket Official Rules wouldn’t work. Besides the dates of the promotion not being pertinent, the sponsor information would likely change for each sweepstakes, and possibly means of entry.

      Regarding your question about Facebook – the issue of having a like as a bonus entry would likely be acceptable under sweepstakes laws but the fact that Facebook is a private entity and has specific terms and conditions, you would also need to comply with their promotion guidelines. See above for a more complete explanation. I’ve also broken them down on my Blog Law series.

      Disclosure: this is not legal advice.

  • Stephanie, while I can understand the moral dilemma you’re pointing out here, the analysis you provide as far as blog contests and US lottery law ignores a lot of realities.

    Federal law in the US bans lotteries. Federal law does not ban “sweepstakes.” Sweepstakes are regulated at the state level and, as such, are most commonly subject to certain laws related to the value of prizes offered. Some states (like Rhode Island) require a permit to conduct these kinds of promotions when the prize is over a certain dollar value. As such, disclaiming eligibility for these states may be a good idea, but failing to do so is unlikely to cause any attempt at enforcement from states that have such restrictions. You find me a single case in the last 5 years on this issue for prizes less than $25,000 given away on the web, and I’ll be very surprised. It’s practically tantamount to enforcement of “use tax” in states like California. Your friendly neighborhood DA isn’t going to waste time on something like this.

    If you’re offering hundreds of thousands of dollars in prizes on an annual basis, I could *maybe* see taking a closer look at state sweepstakes law. But for individual prizes all under $1000? No state is going to go after small timers like that, and telling bloggers they need to engage in disclaimer and legal advice “overkill” is almost as bad as saying they need no disclaimers or terms at all. You don’t need to consult a lawyer to run a $500 sweepstakes. 

    As far as the IRS goes, yes, you do want to report this kind of stuff, nobody wants questions from the tax man.

    If you’re that concerned about people playing “fast and loose” with the law on the web, perhaps you should include a disclaimer on your article indicating that your piece does not constitute legal advice (providing legal advice without being a licensed attorney is against the law in all 50 states, by the way).

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • Ill chime in on this one David. While I agree we should clearly disclose that Stephanie is not a lawyer and one ahould certainly consult a lawyer familiar with these topics in each state, I’ll take exception to your point. You’re essentially saying that we should advise our audience to ignore the law sincs no DA would take the time to prosecute. That, my friend, is irresponsible.

      The law is the law. The advice here, though not to be read as bonded and qualified legal advice from an attorney, is to keep yourself out of potential legal danger. Ill take that over yiur dismissal of “overkill” any day sir.

    • David, perhaps you missed the very specific disclaimer I included at the bottom of the post stating quite clearly that I am not a lawyer.  I certainly do not intend to provide legal advice, this is information given from marketer to marketer only. 

      I disagree with your premise that DAs are not going to concern themselves with sweepstakes. Why did the FTC make such a big deal about blogger disclosure in 2010? And follow it up with a few notices to brands? Not because there were big stakes involved; they wanted to make a point. 

      I think it’s entirely conceivable that an aggressive state attorney general might make this a crusade and really dig their heels in.  But even if they didn’t – why shouldn’t brands and bloggers be aware of the laws and strive to do the right thing? What’s the harm in that?

    • David,

      It is irresponsible to ignore the law because it seems too difficult to follow or because we don’t think we’ll be prosecuted. You’re right that few DAs are going to go after the average blogger. However, pretending the laws don’t exist is unwise because the consequences of ignoring the law can be significant.

      It’s a very slippery slope to suggest that these laws are inconsequential so they can be ignored. At what point are the laws to be followed? The average driver exceeding the speed limit isn’t caught, so why should anyone heed the posted limit? No one sees when a parent smacks their kid hard enough to leave bruises, but does that make it right? If the guy preparing your dinner at your favorite restaurant doesn’t wash his hands after using the bathroom, is that OK? He’s violated a law but who’s there to enforce it?

      Are the laws the best? Maybe not. But the fact is they exist to PROTECT the public from unscrupulous people. They exist because people were being taken advantage of and there was no recourse. The laws were made long before social media and they haven’t caught up to what has become a very easy undertaking – giving something away. That doesn’t mean they should be ignored though. It means they need to be updated, but until that happens we, as leaders in this community, should encourage our peers to adhere to best practices rather than tell them to ignore the law.

      Regards,
      Sara

      Disclosure: I am an attorney but this is not legal advice and I’m not acting as anyone’s attorney, nor is this to be construed as anything other than my personal opinion or general legal information. 

  • When I do blog hop giveaways, I really try to make them giveaways. You sign up for my newsletter, you get 50% off my books. One to one relationship. Is there any legal advice about this sort of interaction? Is it a giveaway or more of a sign-up incentive?

    • Belinda, I don’t want to give you specific advice on your giveaways as I am not a lawyer. However, giving away something with a purchase (a discount, another item) is different than a sweepstakes where you are choosing a random winner and there is no payment exchanging hands.  Do be careful about not making your gift-with-purchase look like a lottery (payment for chance to win); lotteries are regulated by each state and are even more regulated than sweepstakes and contests.  Please check your state regulations or consult with an attorney if you’re still unclear as to where your incentive falls on the spectrum of promotions.

    • There’s no winning of a prize so it isn’t a giveaway in the sense this article is talking about. It’s a coupon in exchange for a signup, my understanding with coupons is that you can give them away for any reason or none (gift certificates are a different matter and make sure what you are doing is a coupon because there are laws related to unclaimed property with gift certificates).

      Oh yeah, I am not a lawyer so definitely check up on what I’ve just said.

  • Stephanie, great post. And thank you for referencing me and my work. I truly appreciate you evangelizing with me. As a brand strategist in the digital media space, your endorsement of ‘doing it legally’ often is heard whereas many tune out when I mention being a lawyer. As brands up the ante on what they give away we’re likely to see more issues. The reality is, though, that a pervasive disregard can also create a significant liability. What’s always bothered me is that many of these brands do know about sweepstakes laws because they’ve done those types of promotions in the traditional space.

    I think bloggers are entering a quagmire of potential liability as they seek to offer their readers more and better giveaways. The barrier to entry is so low, but the learning curve in some areas are quite steep.

    Thanks for continuing to spread the word on how to do it right!

    Sara

    • Sara, you are my inspiration for wanting to spread the word further! We will fight the good fight together.

    • Sara, I’m considering asking brands to have their in house legal people provide me with language for the rules because as you’ve noted the big brands do run these promotions in traditional ad space

      • Jean,

        It would be much easier if the brands took care of this and just made sure it was done right. Ultimately, they’re the ones who will bear the brunt of this. The average blogger can be held up as an example, but real change won’t come about until brands and promotion agencies begin requiring it.

  • Stephanie, great post. And thank you for referencing me and my work. I truly appreciate you evangelizing with me. As a brand strategist in the digital media space, your endorsement of ‘doing it legally’ often is heard whereas many tune out when I mention being a lawyer. As brands up the ante on what they give away we’re likely to see more issues. The reality is, though, that a pervasive disregard can also create a significant liability. What’s always bothered me is that many of these brands do know about sweepstakes laws because they’ve done those types of promotions in the traditional space.

    I think bloggers are entering a quagmire of potential liability as they seek to offer their readers more and better giveaways. The barrier to entry is so low, but the learning curve in some areas are quite steep.

    Thanks for continuing to spread the word on how to do it right!

    Sara

  • Thank you so much for an informative post.  I’ve been doing the odd giveaway for a while and things have picked up lately.  So, I’ll be utilizing the information here to help me improve my blog’s operations and keep everything on the up and up.

    • Excellent, that’s what I hoped would happen. Please be sure to share with other bloggers too, I think it’s soooo important that everyone knows the right way to do this.

  • Thank you! I have just rewritten my terms & conditions!! Always better to be wordy and on the safe side!

    • I love it – take action! Thanks for reading and responding.

  • This is fabulous and sooooo important.  I have many clients who don’t get the differences and they really do matter.