Attracting New Customers Through Contests and Other Giveaways

Using contests and giveaways is a great way to bring in new customers to your business.  It is also a very effective form of advertising.  If you are considering this option, you will want to make sure that you are aware of the regulations set forth by your local government.

First, make sure that you offer accurate information about your contests.  The Competition Act requires that businesses disclose certain information about the contests that they offer.  This information includes:

  • The number of prizes available
  • The value of the prize
  • Regional allocation of prizes
  • Chances of becoming a winner
  • Timeframes associated with prizes
  • Start date and closing date
  • Any other rules regarding your contest

This information should be put somewhere that is easy for consumers to see.

Another thing to consider is the fact that contests are not allowed if they involve chance, unless a skill is also required.  Many companies simply include a skill-testing question to satisfy this particular requirement.  If you don’t follow the guidelines for contests, then you will find the penalties to be harsh.  Penalties may include fines and incarceration.  If you are not sure if your contest is in compliance with the regulations, you might want to talk to a business attorney.