Sweepstakes Are an Effective Marketing Tool
Promotional contests and sweepstakes are an increasingly popular
marketing tool – and for good reason. They provide a
cost-effective way to generate publicity and notoriety for a brand
or product line. Since most sweepstakes games include both
the elements of chance and the awarding of a prize, it is critical
that participants are not required to provide any consideration in
order to participate. As we have recently
discussed, attorneys general aggressively scrutinize and
prosecute violations of this rule.
Assuming that the sweepstakes contest is set up properly, it is
critical to be mindful of the total prize amount, since prizes
above certain cash (or cash equivalent) thresholds may trigger
specific sweepstakes registration and bonding requirements, and
potential consequences, in three states: Florida, New York and
Rhode Island.
