Should You Run a Sweepstakes or a Contest?

You’re looking to grow your business, increase social engagement, and drive sales, so you stumble upon the world of sweepstakes and contests. But, what’s the difference between the two? Should you run a sweepstakes or a contest? What are the use cases? Which one will help you grow your business more?

This article will take you step by step through the differences between the two, how they can be used, and why one may be better than the other for rapid growth.

The Differences Between Sweepstakes and Contests

Most of the time, when people say they want to run a contest, they usually don’t realize that what they think of as a contest is actually considered a sweepstakes.

Though their terms are frequently used interchangeably, they are two different types of promotions.

Sweepstakes and contests have 3 elements that differentiate them: prize, chance, and consideration.

Prize: Anything of value, like goods and services with a monetary value.

Chance: A drawing where the participant has no control over the outcome. Usually, this is a random drawing where luck is the deciding factor.

Consideration: A participant is required to make a purchase, pay an entry fee, or expend significant effort to participate.

In a sweepstakes, only prize and chance are involved.

In a contest, only prize and consideration are involved.

In a lottery, prize, chance, and consideration are involved.

So when it comes to a sweepstakes, you give something away, and the winner is picked at random. For example, entrants submit their email address to win a $100 gift card, and the winner is picked randomly.

In a contest, you give away something, and the winner has to either pay an entry fee or expend significant effort to participate, and the winner is chosen by judging or voting. For example, entrants submit a photo, and the photo that gets the most votes wins.

Keep in mind, the winners in a contest are drawn through some form of judging or voting; a winner in a contest cannot be drawn at random (otherwise “chance” is present, and that makes it a lottery).

Now that you understand what legally separates a sweepstakes from a contest, let’s discuss the differences between the two when it comes to generating results.

What Are Sweepstakes?

Sweepstakes are one of the most widely used marketing strategies because, overall, they can help a business achieve a variety of goals, such as:

• Increase email subscribers
• Increase website traffic
• Increase leads
• Increase awareness of products or services
• Increase sales
• Increase engagement and followers on social media
• Increase brand loyalty

Sweepstakes are powerful because all of these goals can be achieved in a relatively short amount of time with a modest budget.

What Are Contests?

Contests are also a widely used marketing strategy; however, they are not always as effective as sweepstakes because of the effort and skill that is required of the participant. Brands will usually run a contest to reach a smaller range of goals, such as:

• Increase brand awareness
• Increase brand loyalty
• Increase user-generated content
• Increase engagement and followers on social media

While an increase in email subscribers, traffic, and leads are possible with a contest, you can usually expect the number of entries to be much lower than that of a sweepstakes.

The reason for that is simple: the higher the barrier to entry is, the less number of entries you will get.

For example, let’s say you’re giving away a brand new 60” flat-screen television in both a contest and a sweepstakes.

A contest might require entrants to take a picture of their current television and share why they would want to win the new flat screen. The sweepstakes might just require entrants to enter their name and email address.

Which promotion do you think will get more entries? The sweepstakes will, time and time again because the barrier to entry is very low.

Sweepstakes and Contest Use Cases

If we want to simply break down a sweepstakes and contest in terms of when they should be used, we first need to know the objective or goal.

Contests

Typically, you’ll utilize a contest if you want to engage your existing audience. A contest will allow you to get to know your audience better, allow you to collect user-generated content, and give you a better idea of how your brand is currently seen through the eyes of your audience.

User-generated content can be particularly powerful when a social element is tied to it – like your friend sharing a picture of his current television on Twitter and you wondering what it’s all about, and deciding to enter the contest too.

Let’s take a look at this contest from Chiquita Bananas. Users can win up to $4000 each week by first revealing the recipe for the week, creating their own recipe with the ingredients, and then submitting the recipe through the submission form.

The barrier to entry for this contest is very high, but Chiquita Bananas was most likely able to generate some awesome user-generated content from people who created and submitted their own thoughtful recipes.

This type of contest is a great way to engage your audience, get them to interact with your brand, and submit content.

Chiquita Bananas can now use the content that was submitted in their own future marketing initiatives (like releasing a blog post with all the different types of recipes that can be used with their bananas).

Sweepstakes

Most of the promotions that you will see companies running are sweepstakes simply because they are fairly easy to set up, the barrier to entry is usually pretty low, and they can generate significant results in a relatively short period of time.

Since most companies are looking to grow some aspect of their business, whether it’s email subscribers, social followers, sales, leads, or something else, sweepstakes are always the go-to choice.

Let’s take a look at this example from JewelScent, who ran a Valentine’s Day Sweepstakes giving away one of their Jewelscent Jewelry Candles.

In order to enter this sweepstakes, entrants only had to input their email address, making the barrier to entry extremely low. Once entered, users could perform a variety of social actions in order to increase their chances of winning.

The low barrier to entry, coupled with the ability to share on social for more entries, makes this type of sweepstakes extremely viral.

Should You Run a Sweepstakes or Contest?

The decision to run a sweepstakes or a contest will ultimately come down to what your company’s internal goals are.

If you already have an established audience, and your goal is to engage with them and increase your brand awareness, a contest is most likely the better choice. If you are looking to grow your social profiles and rapidly build up your email list, a sweepstakes is the better option.

If you’re planning to run a sweepstakes or contest, be sure to read through ViralSweep’s Advanced Guide To Sweepstakes, which will take you through planning, setting up, launching, and marketing your promotion.

Although the guide is focused on sweepstakes, the planning and execution of a campaign can be applied to contests as well.