the legal resource for fitness entrepreneurs
the legal resource for fitness entrepreneurs

Running giveaways for audience members

Running giveaways for your audience members is a great way to keep your audience engaged and to build your blog and social media audiences as a fitness professional. But, giveaways are not always as simple or straightforward as they might seem. Let’s talk about some of the things you might want to consider before running a giveaway for your audience. We like to help you be prepared and to avoid legal trouble before you find yourself in its midst.

Collecting Entries

Collecting entries for a giveaway is, in practice, collecting information. In addition, depending on the information you ask for, or the actions you require, you may be collecting personally identifiable information. In collecting this information you will likely trigger the need for a privacy policy (also called an information management policy). Some states require these by statute, but if you collect any kind of personal information – including but not limited to name, address, email address, weight, height, birthday – you will need to have a comprehensive policy policy explaining how you use, collect, store, share, and protect the data that a user shares through interactions with your website. Your giveaway conditions should reference your privacy policy.

Deciding on a winner

Is it a game of chance? Is it a game of skill? Is your giveaway based on the subjective review of an entry? Are you requiring a “like” or a “follow” for an entry? Some states require a permit for certain kinds of raffles or contests, including giveaways. Be sure that you are clear on whether you need a permit or license, whether you can accept entries from audience members in every state, and whether you are willing to send the prize internationally.

If you are running a sweepstakes promotion, where no purchase is necessary and prizes are provided to winners at no cost to them, then it is unlikely you will require a license or permit. A few of the free tools available to manage such a giveaway, like Rafflecopter, require a “no purchase necessary” style giveaway (or sweepstakes) to use their tool.  One thing to bear in mind, that can tip a sweepstakes giveaway into the realm of a raffle or a lottery is if entrants offer something of value to obtain an entry. In legal terms this is referred to as “consideration” – it can be money, but it doesn’t have to be. Social media reach, including “likes” and “follows” have value, as does an email address, which means if you require any of these (or anything like it) in order to be entered – these could be interpreted as consideration – then you may fall outside the definition of a sweepstakes (and could be considered to be a lottery). So too, requiring an entrant to visit a third party website and find a specific product (whether requiring any action on that website or not) is also likely to be deemed consideration. One way to avoid this is to make sure at least one entry does not require any kind of consideration or additional activity – you may then offer additional entries for those “likes” or “follows.” Please note that states can have their own case law definition of what constitutes consideration – which means obtaining legal advice from an attorney becomes even more important.

A contest is simply defined as requiring merit or skill where a prize is awarded on the basis of judgment of those entries. Asking entrants to purchase a product or spend money to increase their chances of winning a contest is illegal.

If you run a raffle a permit is likely to be required – a raffle requires a ticket to be purchased, the winners are chosen by luck, and a winner will always be chosen. You will need to check the laws in your state if you are interested in running a raffle. What is important to note is that almost universally, raffles are intended to be a fundraising mechanism for non-profit organizations. If your company or organization is not a registered 501(c)(3) organization it is unlikely that you will receive approval for a permit to operate a raffle by the State.

For the sake of comprehensiveness, a lottery is defined as “raising money by selling tickets and giving prizes to the holders of numbers drawn at random.” A winner isn’t always chosen. Lotteries in the US are exclusively government run, and are prohibited completely in a number of states.

For questions relating to how your giveaway is likely to be classified, whether you will need a permit or license, it’s a good idea to speak with an attorney who understands the legal issues that arise as a consequence of giveaways.
Responsibility for delivery of prizes

One of the things that can go wrong that can end up being time consuming to rectify is when prizes are not delivered to winners in a timely manner. One way to avoid this, if the giveaway is sponsored, is to have the retailer or manufacturer send the product directly to the winner. However, this can also lead to you ending up chasing up a tardy sponsor. Alternatively, if the sponsor ships products or gift cards to you directly, have a post giveaway plan that includes a timeline for sending prizes to winners. If the prize is a physical item, mail it as soon as
possible. If it is a digital prize, provide the winner with a download link. You can address matters relating to contacting sponsors, and the responsibility to deliver prizes in your giveaway conditions. The Giveaway Conditions Template may be helpful to you.

Disclosures

In addition to giveaway conditions that should be considered to be essential to running a giveaway, you may also need to add language relating to Federal Trade Commission (FTC) compliant disclosures if any of the prizes are as a consequence of brand sponsorship or endorsement.

For example, if a company gives you a $100 gift card or product to give away to one of your readers and a second $100 gift card or product to keep for yourself, you will need to disclose both, and not just the gift card received to giveaway. These disclosures should be clear, included at the beginning of the blog post or social media post, and not intended to be obtuse or hidden. See FTC Sponsorship Guidelines for more information.

You should also note that if you run a contest or sweepstake on social media that allows for additional entries for social media postings, your giveaway conditions must require disclosure of the giveaway sponsorship in every entry: #ad or #sponsored, are examples of compliant disclosures. You should note that the brand or you as the host of the giveaway, not the sweepstakes entrants, are responsible for ensuring that a disclosure is being included.

Giveaway Conditions

Developing a sound set of giveaway conditions is essential for any fitness professional who is seeking to run giveaways whether on or offline. This giveaway conditions template may provide what you are looking for. Any fitness professional looking to run a giveaway that adds value to your business without risking its future must take the planning for giveaways seriously and give thought to the giveaway conditions entrants will agree to, as well as making sure you meet any and all required if the prizes are sponsored by a brand.

About the author

Anna Blanch Rabe is a communications consultant, writer, and speaker. A non-practicing attorney, she works with social impact businesses and non-profit organizations to develop and effectively execute narrative initiatives to gain exposure, develop community capacity, and reach new customers. A former college level athlete, she now enjoys yoga and swimming, and crewing for her trail and ultrarunning husband.

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