Category Archives: Online competitions

Notifying winners

Notifying winners can be a lot of fun, but also needs to be done carefully! Winners will be overwhelmed to hear that they have won something from your company. Many then go on to be ambassadors of your brand.

It is important to take care when notifying winners, as mistakes can be costly. In one case, a Junior Marketing Assistant conducted a competition draw before the scheduled draw time, then contacted the winner, and then went out for lunch. The Marketing Manager, unable to reach the Assistant, assumed the draw had not occurred, so conducted a second draw and notified a second winner. The prize was valued at over $25k..

Prior to contacting winners you should ensure that the winner’s original entry was valid i.e. that they completed the entry requirements, met any minimum age requirements and provided required information.

There may be some information that you need to award the prize, such as a prize delivery address, or preferred dates of travel. You can request this information in your email or letter to the winner. It is always best to have information you need in writing.

Winners must be notified in accordance with the competition terms and conditions. For a chance-based competition, you will need to notify winners in writing within 2 days of the competition draw. You may also need to publish their details on a website or in a newspaper.

Below is a sample letter that can be used to notify winners of a chance-based competition. Ensure that you change the wording to suit the circumstances of your individual competition.

Sample winner notification letter

Sample winner notification letter

When publishing a winner’s name on a website or in a newspaper the common format used is:  [Competition Name], [Prize Details] winner: First Initial] [Last Name], [Suburb].

It is a condition of competition permits that prizes be awarded in the manner specified in the competition terms and conditions.

Click here for a copy of the above document.

For more template notification letters, details on how to publish winners, and how to obtain competition permits, contact us- info@permitzgroup.com

 

Four important points when designing a competition

Each competition has a different measure of success. Common indicators of success may include:

  1. An increase in sales over the promotional period;
  2. Increased awareness of the brand or your products;
  3. The development of a potential customer database for email or direct marketing; and / or
  4. The collection of data on your current or potential customers.

On review of over one hundred recent promotions, we have determined that there are a number of factors that influence success. These are listing in order of the priority as we have found them:

  1. Whether the right people know about the competition. A competition will not attract entrants unless the right people know that there is a prize on offer. Advertising should be aimed at entrants. Competitions are a very good call to action in an advertising campaign.
  2. Perceived odds of winning. Promotions which are widely advertised with fewer prizes on offer may be perceived to offer lesser chances to win. By offering major and minor prizes you can increase people’s perception of their own chances of winning.
  3. The relevance of the prize. The competition prize on offer should be something that your target entrants actually want to win.
  4. Ease of entry. Many competitions include layers of bonus entry mechanics or steps that entrants need to follow to enter. The harder it is to enter, the less entrants you will have.

The actual value of a prize is one factor that is not as important in determining the number of entries. Most entrants do not readily appreciate the difference between $5,000 and $10,000- they are both just a large sum of money & are hard to visualize.

Essential elements to a successful consumer promotion

Consumer promotions or competitions are a form of trade between a consumer and a business. In exchange for the ‘chance to win a prize’ or multiple chances to win, the consumer is asked to provide their personal information, to purchase a product or service or to interact with a brand in some other way.

For a consumer promotion to be effective, the trade-off made by the consumer needs to be in proportion to what is on offer via the competition-

The most topical example of the above over the last quarter has to do with the collection, use and disclosure of personal information collected when someone enters a competition. It is fair enough to say that most consumers have an expectation that the information they provide will be used for marketing or promotional purposes.

However, if the use is too wide or the trade-off too unfair, potential entrants can be turned away. If you were asked to consent to receive unlimited marketing material from unknown third parties for a chance to win a holiday, you would be more hesitant to do so than if you were asked to simply subscribe to a newsletter (and given the opportunity to opt-out at any time).

Since the protection and understanding of use of personal information is such a relevant topic, it is now more important than ever to ensure that consumers understand how the personal information they provide will be used by the company collecting it. To do this, the intended use and disclosure should be clear on the term, in the advertising and in the Promoter’s Privacy Policy.

What is a reasonable trade-off will largely depend on the intended audience for the promotion which should tie back strongly to the actual brand and the types of customers the company is looking to attract or retain. Entry methods, prizes, ways of communicating with entrants and potential winners and advertising of the competition need to be focused on the demographics of the entrants that are sought.

Many companies go to extreme lengths to include various social media ‘likes’ follows and ‘shares’, to allow various layers of bonus entries and have a number of steps that need to be followed by an entrant to enter. These steps can overcomplicate the competition and push the balance away from a proportional trade off.

Simplicity is usually the answer.

Conducting a competition that is focused on your consumers, is proportional in what is on offer, and is communicated via advertising effectively is the right way.

Competitions to get Facebook ‘likes’

Facebook competitions are a good way of encouraging customers to ‘like’ your page and interact with your business. If you are going to set up a Facebook competition, make sure you do it properly.

Facebook has Pages Terms (last updated April 3, 2013) that govern any competition/promotion that you run on Facebook. It is imperative that you comply with Facebook’s Terms and the other regulations that apply to competitions. If you fail to do so, Facebook may pull your page down without warning. This in turn can lead to issues with the State Lottery, Fair Trading and/or Consumer Protection agencies.

Will it be worthwhile?

Before you decide to run a competition on Facebook consider whether doing so will be worthwhile. Is your brand or product targeted to those who use Facebook? Facebook is certainly popular, but it may not be an appropriate marketing platform for you. Having said this, with such a large number of dedicated users from all walks of life, you should not discount Facebook as a possible way of attracting new customers. Facebook ‘likes’ do not equate to customers so once you have the likes you will need to continue to work and impress to convert likes to customers.

It is surprising to see how many businesses, that do run Facebook competitions, are unaware of the requirements. Although many will get away with not complying, those that don’t will sure know about it.

Below we set out some of that the requirements you should consider.

So what do the Terms say?

Firstly, it’s important to note that there are many laws that apply to competitions and that Facebook’s Guideline does not give you a complete understanding of those laws. You must also consider consumer protection, privacy and trade promotion laws when designing and running a competition.

Here is a summary of some of the key points in the Guideline:

  • You must use a third-party developed application to administer your competition (either on a Canvas Page or a Page App). There are few applications around that you can use, such as Wildfire.
  • You can’t enter people into your competition simply by them ‘liking’ your page or uploading content onto Facebook or tagging photos. You can have people ‘like’ your page, but then must have them take other steps, i.e. register to enter the competition using the third-party application. If you are running a voting competition you cannot use the ‘like’ function to collect votes.
  • You must acknowledge that your competition is run by you and not by Facebook and include:

“a.    A complete release of Facebook by each entrant or participant.

b.    Acknowledgment that the promotion is in no way sponsored, endorsed or administered by, or associated with, Facebook.

c. Disclosure that the participant is providing information to [disclose recipient(s) of information] and not to Facebook.

d. You mustn’t notify competition winners on Facebook. i.e. when you determine your winners, you can’t notify or announce them over Facebook.”

It is possible that you have seen a competition on Facebook that does not comply with some or all of the requirements listed above. Its important that you do ensure you do comply with Facebook’s Terms and any other regulatory requirements surrounding competitions- i.e. including the requirement to obtain competition permits from some Australian states.

Conclusion

A Facebook competition may be a very worthwhile method of getting people to like your page and interact with your brand. However, remember that there are a number of requirements to consider when running a Facebook competition. If you are going to go ahead with a Facebook competition, make sure that you check the current version of Facebook’s Terms and comply with all other requirements.

Win! Grateful customers

Most of Australia’s largest and best-known brands give away cash and prizes every year via competitions, but there’s nothing to stop soloists getting a piece of the action, too.

Competitions can work very well to promote what it is that businesses large and small sell. Entrants can be required to purchase a product or service. Some applicants lodge multiple entries by purchasing multiple products, which can give your bottom line a boost.

When it receives an entry in a competition, a business is provided with useful information about a consumer. However, it is essential to comply with the Privacy Act, National Privacy Principles and Spam Act in the collection, storage, use and updating of, this information.

Competitions also create a general feeling of excitement and interest in a business brand. As an alternative to discounting, competitions can be a more cost effective option in that predetermined prizes are being won as opposed to losing a percentage off an undetermined number of sales, which cannot be accounted or budgeted for in advance.

How to successfully run a competition and avoid the pitfalls

Compliance with all state based regulations on trade promotions is absolutely essential if you are running a chance-based competition. Compliance with Australian Consumer Law is also essential for all competitions, whether they are chance or skill-based.

For national competitions, where the winners are determined by an element of chance, there are a number of essential requirements. These include:

  • You need terms and conditions clearly setting out how and when people enter, the prizes including their value, the number of winners, and how you will notify the winners;
  • Trade promotion permits will be required from NSW and ACT (unless an exception applies) if your prize total is $5,000 or less;
  • Trade promotion permits will be required from NSW, ACT (unless an exception applies), SA and VIC if your prize total is over $5,000.
  • You cannot begin advertising your competition unless you have received all of the relevant permits.
  • You will need to display minimum (condensed) terms along with permit numbers in all advertising of your competition; and
  • You must collect entries, draw the winners and award the prizes you say you will in your terms and advertising. Records, including entries and winners, must be kept.

If you are going to run a competition, it’s essential to ensure that you comply with the relevant laws.

When conducted properly, the running of competitions can be an exciting and cost effective way to generate increased sales and further promote your company’s goods and services.

Have you run a competition? Was it a success?