Starting a Competition Site

[max99]

Okay

So lets say I wanted to start a competition site, where by users pay, do something, be it answer a question, play a game and get entered into a draw to win a prize.

In terms of legality what do I need to know ? Are there any websites out there that would aid me

Thanks
Max

[loquax]

So lets say I wanted to start a competition site, where by users pay

Firstly I'd do some research about whether people would actually pay to enter a competition, how much they'd be willing to pay, and whether it's actually viable.

You also need to look at raffle law and lottery law as well as what defines skill where payment is asked for competitions

Jason

[accelerator]

Originally Posted by loquax Firstly I'd do some research about whether people would actually pay to enter a competition, how much they'd be willing to pay, and whether it's actually viable.

I am guessing from this that you feel the vast majority of users won't pay to enter a competition online?

I would guess that most users won't want to pay anything, although I don't have any data on that.

[Affi Liate]

The answer is very simple (and the sollution free).

Phone a lawyer.

Tell them you are serious about entering your chosen market, you are hoping that they are quallified enough to represent you (going forward) and what advice do they give you in the meantime?

They will rattle off everything you need to consider in about 2 minutes flat.

That 3 minute call (waffle included) will save you 17 months of trying to find out (with confidence) on here or by googling the subject.

Affi Okay

Affi are we ok, are we ok Affi...

[sgpratley]

Firstly I'd do some research about whether people would actually pay to enter a competition

There are a couple of sites out there on this model, best of the best being one I can think of, but the prizes are huge and the marketing budget is not insignificant either.

People who enter competitions want something for free, right? There are a couple of ways that you can make that payment easier, like premium rate text or phone lines, but getting someone to get a credit card out is a different matter altogether.

As for the legal bit, any competition which needs payment to enter has to have an element of skill or it is an illegal lottery, that's why the TV phone in comps have those p**s easy questions in them.

You'd probably find it easier to let them enter for free then do something useful with the customer data you gather off the back of it - like promote other competitions

As for T&C's , go have a look round any competition on any of the TV channel websites, they've had such a grilling recently their competitions should be watertight by now.

[loquax]

There are a couple of ways that you can make that payment easier, like premium rate text or phone lines

True, but you need to get the right balance of entry fee to prize... people tend to be happy to spend 25p/50p on an average prize (iPod) but not £1.50+. Few would spend £3+ on a competition.

However, if you then use SMS, you're not getting say 50p in your pocket per entry - think after fees etc you're lucky to get 10p... so 1000 entries needed straight off to pay for the prize.... doesn't sound many, but unless you're a decent brand "pay to enter" comps can often be regarded as scammy.

Another point is that competition portals, like ourselves, tend not to promote such sites (being paid helps change the opinion)... that's not the end of the world though (unless you're like one site who's whole business plan seemed to revolve around getting free traffic from us as they'd assumed several thousand compers would love the site).

let them enter for free then do something useful with the customer data you gather off the back of it - like promote other competitions

I've tended to keep away from co-reg so I don't know how good it is for making a few quid - I guess you need to be able to sell the data as well as co-reg it... but with all that comes a reputation.

Jason

[max99]

thanks for replies so far. makes for some interesting reading. Basically looks like there is 2 ways to go.
Either make it free to enter, and use the data to make money from
or
make them pay to enter, where by the text option seems to best however small revenue from each.

Not really sure which way to go, will have to have a big think about it and see which looks the most feasible method.

[drivetowin]

If you decide to go the text option, have a word with the guys at itagg - they really know their stuff about sms and their rates have always worked out well for us.

[PhineasTBarnum]

I won't vouch for its accuracy, but I found this helpful.

Running a competition | OUT-LAW.COM

[sgpratley]

I've tended to keep away from co-reg so I don't know how good it is for making a few quid

Depends how compelling what you have on offer is.
I've a nice little quiz website that people keep coming back to just for the hell of it.

There are other options apart from coreg, mostly evolving around follow-up email campaigns that won't knacker your list on day 1.

[loquax]

I've a nice little quiz website that people keep coming back to just for the hell of it

That's just Offerx in disguise though.. do they offer white label solutions? (daft question course they do... perhaps that's a better option for max? might be interested in it too if you have any info)

Jason