Contests, Promotions and Social Media — Is Public Voting Worth the Risk?
Business Litigation Update
Date: March 04, 2013
Social media offers businesses unprecedented access to and interactivity with their customers. Contests, sweepstakes and other promotions have proliferated on social media sites, particularly on Facebook. Sponsors hope their promotions will go "viral," and the use of public voting in an online promotion, particularly in the contest format (for example, photo contests), increases the opportunities associated with social media marketing. Sponsors expect contest entrants will attempt to "get out the vote" by encouraging friends to visit a contest page and vote for their entry. Promotions utilizing public voting come with both legal and practical risk, and reliance on public voting also increases the potential for unfair game play. This bulletin identifies some procedures to ensure fairness and smooth operation of promotions involving public voting.
Does Public Voting Make a “Contest” a “Sweepstakes”?
The terms "contest" and "sweepstakes" are frequently used interchangeably, but there is a definite legal distinction between the two types of promotion. The difference stems from the need to prevent a promotion from constituting an illegal "lottery," which includes three elements: a prize, a chance to win the prize and consideration (i.e., payment for the chance or some other expenditure of time and effort by an entrant). A sweepstakes eliminates the consideration requirement. A contest, by comparison, eliminates the "chance" requirement. A properly structured contest requires a bona fide demonstration of skill, where a winner can be determined through the application of objective (or at least clearly stated) criteria. State laws vary as to whether any element of chance may remain in contests; most states utilize a "predominance" test.
Many sponsors utilize public voting as the sole mechanism for determining the winner of a contest. The unfettered use of public voting, however, can raise questions of whether the outcome is a demonstration of skill or one of chance. Voters may not follow formal judging criteria if they are offered, but instead may simply vote for friends or family members. As an additional matter, the timing of an entry or its placement in a list or gallery of entries may have an undue impact on its ability to secure votes. For example, early entries (if posted as they arrive) have more time to obtain votes, and entries appearing on the first page of a multi-screen gallery are far more likely to receive votes than those appearing later. Care should be taken in structuring a contest to avoid the inadvertent insertion of elements of chance, creating the risk that a contest may be found to contain impermissible elements of chance and be reclassified as a sweepstakes.
Additional Problems and Considerations
The use of public voting creates other practical difficulties for contest sponsors. In particular, public voting frequently leads to irregularities or outright cheating, or to allegations by one entrant of cheating by another. These problems can both disrupt the smooth operation of a contest or promotion and lead to consumer backlash, with entrants taking to social media to voice their displeasure with the contest and/or the sponsor.
Voting irregularities may take a variety of forms. Entrants may create fake accounts, IP addresses or email addresses in order to create additional votes, or use automated voting software. An entrant may go beyond traditional "get out the vote" messages to friends and utilize third-party web pages to solicit votes from people they do not know, offer to exchange votes with others through the use of social media or, in extreme cases, offer payment or prizes to people to vote for their entry. A final set of problems may arise from the submission of entries containing inappropriate matter or from voters selecting an entrant who is for one reason or another undesirable to the sponsor.
Well-drafted contest rules may reduce legal risks, but they cannot eliminate potential backlash from entrants or participants if a contest is disrupted or if entrants are disqualified. As an example, a contest run by Gold Peak Tea last fall resulted in the disqualification of a grand prize winner after it was determined the winner - a practicing attorney - had solicited votes on an online contest forum. The disgruntled and disqualified entrant then took to Facebook to argue his case. The resulting publicity eventually resulted in an article discussing the controversy in the New York Times.
Solutions and Workarounds
Contest rules should be drafted to:
- Clearly specify what types of entry content may be objectionable.
- Set out voting limits (whether by person, by account or by computer, and to identify how often or how many votes will be allowed).
- Prevent fakery (including by creation of multiple accounts or hacking).
- Provide discretion to the contest sponsor to disqualify improperly made or obtained votes, as well as any entrants who engage in such conduct or who submit objectionable material in an entry.
Sponsors may also wish to consider explicitly forbidding entrants from utilizing vote aggregators, vote exchange pages or other third-party means of soliciting votes for their entries.
Risks incident to public voting can also be controlled through proper contest design. Entries can be monitored or approved before becoming available for public voting, though this requires a more robust entry process than simply posting and liking entries on Facebook. Voting can be combined with judging in a variety of ways. For example, the results of voting can simply become one criterion that judges consider in making decisions. Alternately, determination of a winner can be split into multiple rounds where public voting can be used to winnow entries down to a number of finalists, with judges determining the ultimate winner, or vice versa. Distortions caused by public voting due to entry timing or entry placement can be minimized by opening voting only after an entry period or by dividing entries into smaller groups that are quickly viewable by voters.
Plan Ahead to Avoid Problems
Social media contests and promotions utilizing public voting should be carefully structured to maximize participation while minimizing legal risk and the chance for disruption or an undesirable outcome. Thorough advance consideration of the details of a promotion will lead to improved results, fewer disruptions and reduced risk of complaints or legal enforcement actions, as well as fewer disgruntled contest entrants and participants.