Subscriber-only giveaways are a popular marketing tactic among creators and brands looking to reward loyal fans or attract new ones. However, the legality of these giveaways depends on how they are structured and the laws governing promotions. Let’s break down what’s allowed and what isn’t to help you run a compliant subscriber-only giveaway.
A giveaway becomes legally questionable if it resembles a lottery. A lottery has three elements:
Something of value is awarded to the winner.
Winners are chosen randomly.
Participants provide something of value, such as money or a subscription.
If all three elements are present, the giveaway may violate laws unless specifically authorized.
It depends. The key issue with subscriber-only giveaways lies in the consideration element. If subscribing to a paid service (like a newsletter or streaming platform) is required to enter, it could be seen as charging for entry, which may classify the giveaway as a lottery. To avoid legal pitfalls, businesses and creators must eliminate the “consideration” element by offering a free method of entry.
To comply with giveaway laws, consider these steps:
Allow participants to enter without subscribing, such as by submitting a free entry form. Clearly outline this option in the rules.
Include eligibility requirements, entry methods, deadlines, and prize details in the giveaway’s terms and conditions.
Ensure all participants are aware of the free entry method by prominently displaying it on your promotional materials.
Some states require registration or bonding for giveaways with high-value prizes. Consult a sweepstakes attorney to ensure compliance with state-specific rules.
Subscriber-only giveaways can be a legal gray area. A sweepstakes lawyer can:
While subscriber-only giveaways are an excellent way to engage with your audience, it’s crucial to follow the rules. By including a free entry method and adhering to other legal requirements, you can avoid turning your promotion into an illegal lottery. Need help setting up a giveaway? Contact us today for a free consultation on running legally compliant promotions!
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