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RAB Research Archive

Sweepstakes, contests, and…no lotteries



When constructing promotional programs, make certain you are familiar with the concept of a "lottery" and avoid such a scheme.

A "lottery" occurs when three elements are present: prize, chance, and consideration. This means that if you are offering a customer a chance at winning only if he/she purchases a product, you have illegally constructed a lottery. Here's what's not illegal: "Buy one, get one," in which each and EVERY customer who buys a product also receives a free premium.

Lottery laws are not a media-specific legality. Most states’ Attorneys General disallow this activity at ANY consumer level. It's always best to clear contests with your legal advisors first.

Source: Brandeis C. Hall, VP Professional Development/RAB





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