The words sweepstakes and lotteries are often used interchangeably. When it comes to customers, this isn’t a big deal. They know they’re playing a game, and, hopefully, they’ll win a prize. But brands cannot afford to be as casual with their language. There are significant differences between these “games of chance,” as well as in issues of regulation.
Both lotteries and sweepstakes involve a game of chance. Winners aren’t chosen because they have the best entry; they’re chosen at random. But there is a key distinction: sweepstakes are free to enter. Lotteries, on the other hand, raise money by selling tickets. The prizes are given away at random, but winners have to “pay to play.”
Most states have official state lotteries, and these are governed by strict rules (e.g. sales to minors are prohibited, time limits to claim prizes, etc.). When done improperly, brands running sweepstakes can veer into lottery territory – and this is illegal. What should they be on the watch for when running a sweepstakes?
Before you launch a sweepstakes, make sure that you are fully compliant – this will empower you to engage customers without facing penalties and fines. For guidance, give the experts at Enteractive Solutions Group a call.