What authors need to know about contests
A lot of authors run contests on their websites, with prize values ranging from a couple of dollars to big ones worth thousands. It’s a common and usually fun and harmless promotional practice, but it still should not be done without knowledge of the laws regarding sweepstakes.
A quick rundown:
1. In the legal definition of a contest, the winner is determined by skill. A boxing match is a contest. A horse race is a contest. Increasing your skill increases the chances of winning a contest.
2. In a sweepstakes, the winner(s) are drawn randomly and no skill is required. Even though authors call their promotions “contests,” most of them are actually sweepstakes, and all sweepstakes must be “no purchase necessary.” This means authors can’t require that entrants in their contests buy their books in order to be eligible to win. If buying a book is required, the promotion becomes a lottery, and it’s illegal for private parties to run lotteries.
3. A giveaway is another promotional option, legally defined as a prize awarded freely to everyone. An author awarding promotional goodies on her website free of charge to anyone who wants them is technically a giveaway.
One way some authors run contests where entrants can send in their book purchase receipts is to offer an alternate form of entering that is free, usually by allowing entrants to mail a postcard with their name, address, and the name of the contest (which is technically a sweepstakes).
Note: This is a general overview of sweepstakes law as we understand it and is not inteded as legal advice. We do not guarantee the absolute accuracy of the information presented above. If you’re unsure of the legalities of your contest/sweepstakes, please consult an attorney.
Sources:
Sweepstakes Advertising: A Consumer Guide
