Keeping Research Incentive Sweepstakes Legal

Many marketing research studies use some sort of incentive system to assure an acceptable level of respondent participation or response rate for their surveys. Panel companies that do Internet or mail surveys and pre-recruit panelists to take surveys use point reward systems, cash, give away and other types of incentives, and recruiters for focus groups typically use stipends (i.e., $75/ consumer respondent). Sweepstakes also can be used as a method for boosting response rates, but making sure they are conducted legally can be tricky.

In the United States, sweepstakes and contests are regulated Federal Trade Commission at the federal level, which regulates advertising and unfair trade practices.�Sweepstakes are generally permitted in most states as long as participants are not required to pay for the chance to win.�Additionally, a practice known as "alternative free means of entry" is often employed where "no purchase is required" to win and anyone (participant or not) can enter to win through alternative means -- such as sending a postcard to a specific address.�The postcard option is important to consider as an Internet option for a sweepstakes entry could be considered exclusionary to those without Internet access, and therefore illegal.

Different states have different laws that govern sweepstakes, which definitely should be taken into consideration.�Almost every state has specific and monopolistic laws governing lotteries, but in the case of sweepstakes, as long as there is a prize and a free and equal change of participating and winning the prize, the process can be fairly easy.�Keep in mind that Florida and New York require registration of games if the prize is valued at more than $5,000, and states such as Arizona and Rhode Island have strict and somewhat different sweepstakes regulations. Legal counsel should always be obtained.�

With an Internet sweepstakes, sponsors must be careful as the World Wide Web is indeed open to potential participants worldwide, and could therefore be governed by foreign laws governing sweepstakes.�To avoid any issues, sweepstakes sponsors should somehow restrict participation to residents of the United States (IP filtering, for example).

The important thing to remember is that any sweepstakes is a contract between the sponsor and the potential participants, so the rules need to be clearly stated and not changed.�All sweepstakes should absolutely be accompanied by "official contest rules" that are written in a clear and unambiguous manner and should include specific details about the sweepstakes.�

At a minimum, included in the "official sweepstakes rules" should be:

  • Alternative means of participation

  • Clear entry deadline

  • Consequences of tampering

  • Date prize will be rewarded

  • Description and value of prizes

  • Eligibility and disqualification rules

  • Frequency of entry

  • How to enter the survey (means of participation)

  • Information on obtaining winner list

  • No purchase necessary

  • Odds of winning

  • Process for unclaimed prizes

  • Sweepstakes begin and end dates

  • Transferring of prizes

  • Winner notification process

  • Your lack of responsibility for circumstances beyond your control

All Content � Copyright 2004-2011. Polaris Marketing Research, Inc. All Rights Reserved.

Send inquiries to or call 1-888-816-8700.