10 practical tips that you need to consider when running a prize draw
Nowadays, there is a range of fun, engaging marketing tools businesses can use to stand out from the crowd and attract new customers, with prize draws being a popular choice.
Differing from a competition which relies on skill, or a lottery which entrants pay to enter, a prize draw is generally free to enter and winners are selected at random. Entrants may be required to purchase a product with the aim of winning a prize. In some cases, businesses can even charge for a prize draw as long as a free route of entry is provided.
While running a prize draw may not seem like the most complicated process, there are a number of legal considerations you need to make to stay transparent and compliant.
Here are 10 practical tips that you need to consider when running a prize draw.
1. Explain how to enter.
Explain to participants how they enter the prize draw. This might seem obvious, but it is often overlooked! If the participant needs to scan a QR code or fill out a form to enter, tell them.
2. Be upfront about cost of entry.
Be upfront about whether there are any costs incurred by the participant to enter the prize draw, for example, the cost of purchasing an item, or paying for a normal rate telephone call to enter the prize draw.
3. Tell participants what the prize includes.
Explain clearly what the prize includes, and in some cases what it does not include -which leads onto our next tip.
4. Highlight any additional costs.
Make participants aware of any additional costs they may incur in order to use the prize, for example, additional travel costs.
5. Don't discriminate.
Make sure your prize draw does not discriminate against participants, for example on grounds of disability, race, age etc.
6. Privacy policy.
Ensure that your privacy policy or notice is referred to in your prize draw terms and conditions.
7. Participants must accept your T&Cs and privacy policy.
Make sure participants accept your prize draw terms and conditions and your privacy policy or notice before participating in a prize draw.
8. Sharing data
If you share personal data with external third parties to carry out the prize draw, tell participants in your privacy policy or notice that you intend to do so.
9. Direct marketing.
If you want to send direct marketing to people who have entered your prize draw, you must not make signing up for a newsletter or other marketing and communications a prerequisite to entry. You may invite them to subscribe to your newsletter or other marketing and communications, but this must be separate from entering the prize draw.
10. Get consent.
It is always best to obtain the consent of the winner, before you publicly announce that they have won the prize draw.
If you would like to discuss this further, please contact David Wozniak or Rhiannon Hastings.