Posts Tagged: Promotion

2016: The Year in Review

In case you missed it, here are some notable items from 2016 concerning sweepstakes, contests, and related promotional matters:

Influencers, Native Advertising, and Endorsements

2016 kicked off with reaction to the FTC’s new Native Advertising Rules which seek more transparency in sponsored stories/advertising.

In March, in its first enforcement action, the FTC cracked down on Lord & Taylor for paying “influencers” to attract social media attention to its Paisley Asymmetrical Dress.  The FTC issued a number of directives, including making the influencers aware of their participation, and making disclosure of the relationship unavoidable.

In May, the National Advertising Division (NAD), a self-regulatory industry, issued a decision concerning native advertising appearing in People.com under the “Stuff We Love” section.  The NAD determined that disclosure of the sponsorship must be made before you get to the stuff page.

In July, the FTC charged Warner Bros. with making inadequate disclosures in videos of influencers playing a new video game.  The FTC didn’t like that the sponsorship disclosure was in a collapsed box below the video and needed to be in a place where consumers will find it.

In October, in an effort to comply with the FTC Rule, YouTube introduced a new feature allowing visible text on a video for the first few seconds with the label stating “Includes paid promotion”

The take:  Consumers and the FTC don’t particularly like “influencers” or hidden ads, so be conspicuous. (more…)

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Condemnation, Litigation, Regulation, Legislation, Congratulation – Are NFL Ratings Down because of The Daily Fantasy Sports Crackdown?

 

Sports Illustrated recently had an article listing their experts’ take on why NFL TV ratings are down an overall 11% from last year.  Number 7 on their top 10 list was the Daily Fantasy Sports (DFS) bans.  Should the past year of condemnation, litigation, regulation and legislation lead to congratulation to aggressive state attorneys general and legislators for this downturn?  Perhaps.  But to the delight of the NFL (and ESPN, CBS and NBC), most states are now saying “Give Peace A Chance.”

First, DFS were flying under the radar and gradually creating a buzz.  Then, DFS exploded last year spurring increased NFL interest and TV viewership.  Because of this popularity, many legislatures took an interest and decided they had to investigate this (new) phenomena.  A number of state attorneys general issued formal opinions condemning DFS and some filed lawsuits against DFS operators.  Now, the dust is starting to clear, and it appears that most states are recognizing that DFS is a form of legal contest. (more…)

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Big Blue Fans Win Big Red Steaks: Promotions That Go Better (?) Than Expected

On Saturday (October 8), the University of Michigan eleven beat Rutgers by the lopsided score of 78-0. I don’t know if the Wolverines were fed red meat before the game, but the fans in Ann Arbor are sure lining up for some at the local Ruth’s Chris Steakhouse. Prior to the game, the restaurant posted on its Facebook page that from Sunday through Thursday it will offer a discount to match the winning point differential. The original post did not mention a cap, but was subsequently edited to limit the discount to 50% off the bill, excluding alcohol. A post after the game, indicated that the restaurant was booked through Thursday.

The timing of the additional restrictions may be problematic, but regardless, Ruth’s Chris Ann Arbor may have gotten more than it bargained for. There’s always that sweet spot that promotors are looking for to generate traffic without breaking the bank, and thanks to an historic performance by Big Blue, it’s possible that Ruth’s Chris Ann Arbor’s promotion could put it in the red. (more…)

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Is It Really “The Best [Insert Product] You Ever Bought?” Amazon Limits Incentivized Reviews

When shopping online, we all want to know what lawnmower/backscratcher/egg timer is the best. Once we’ve found an array of options, many of us go right to the online reviews to see how others liked the product. Caveat emptor be damned, Ralph from Bensonhurst just loved the Handy Housewife Helper, so I want one too. Little did we know that Ralph and his partner Ed were trying to unload 2,000 of these gadgets to the unsuspecting public.

To help bolster the legitimacy of online reviews, yesterday (October 3, 2016) Amazon announced an Update on Consumer Reviews explaining that it has updated its community guidelines to prohibit incentivized reviews unless they are facilitated through the Amazon Vine program. (more…)

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Playing for Keeps: Daily Fantasy Football 2016

When the last online fantasy football game was played, the attorneys general of New York, Nevada and Illinois were throwing penalty flags, state legislators was huddling to set the next play, and the daily fantasy sports leagues were taking it on the chin.

Where are we now? Here’s a 50 state survey:

DFS expressly allowed: CO, IN, KS, MD, MA, MS, MO, NY, RI, TN, WV, VA

Contested: AL, DE, GA, HI, ID, IL, NV, SD, TX

Banned: AZ, IO, LA, MT, WA

Proposed legislation: CA, CT, FL, KY, MI, MN, NE, NJ, NM, OK, PA, SC, WI

No legislation: AS, AK, ME, NH, NC, ND, OH, OR, UT, WY

How about this stat: leading up to the 2015 NFL season, daily fantasy sports leagues spent over $750 million in ads – more than the entire beer industry. In 2015, the top two companies had recorded a combined $3 billion in player entry fees. (more…)

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Why is That in the Official Rules? What to Know When You Copy and Paste

According to Wikipedia, the term “copy-and-paste” refers to the popular, simple method of reproducing text from a source to a destination. We all do it. You may even do it to draft your Official Rules for a sweepstakes or contest. No need to re-create the wheel, right? But, to continue this metaphor, if you are creating a wheel and want it to hold up your new car, you don’t want to just take someone else’s word that the wheel works without knowing how or why it works.

Here are some commonly copied Official Rules provisions, along with an explanation of why they’re in there:

  • “NO PURCHASE NECESSARY.” Required by many states, including that it must be clearly and conspicuously disclosed. Hence, it is typically at the beginning of the Rules and in capital letters.
  • “PURCHASE WILL NOT INCREASE YOUR CHANCE OF WINNING.” This phrase is required under Federal Deceptive Mailing and Enforcement Act for direct mail promotions.
  • “Open only to legal residents of the 50 United States and D.C.” Saying just “residents of the United States” could conceivably be interpreted as including residents of Puerto Rico, the Virgin Islands, American Samoa, and Guam. Nothing wrong with opening the sweeps to these residents, but at least do it intentionally.
  • “You must be physically present in the 50 United States or D.C. when entering.” This is often used in combination with the requirement that the entrant be a US resident to try to ensure that U.S. law will apply to any disputes.
  • “Entrants must be 13 or older.” This is used for online promotions to avoid having to comply with the Children’s Online Privacy Protection Act which applies to online promotions directed to children under 13.
  • “Entrants must be 18 or older.” – Many court decisions have held that the Official Rules form a binding contract between the sponsor and the entrant. The age of consent to enter into a binding contract is 18 in most states, except Mississippi – 21 and Alabama and Nebraska – 19.
  • “Employees of Sponsor and anyone associated with this promotion, as well as their family and householder members are not eligible.” This is included to try to ensure that there is no appearance of, or actual, impropriety in the administration of the promotion and selection of winners.
  • “Approximate retail value (ARV) of prize is …” This is required under the laws of many states.
  • “By participating, you grant Sponsor permission to use your name, photograph, voice, any other likeness, or comments for publicity purposes, in any and all media, now known or hereafter devised, without further compensation, unless prohibited by law.” The phrase “unless prohibited by law” is added because you cannot require a person from Tennessee to provide a publicity release.
  • “Winner will be required to sign a prize release.” While the Official Rules form a binding contract, the laws of some states such as MA, NY, RI, VT, VA and WI require releases to be in writing and signed by the releasor.
  • “An IRS Form 1099 will be issued to winner.” Under IRS regulations, the sponsor must send an IRS Form 1099 to winners of prizes of $600 or more.
  • “If due to a printing, production or other error, more prizes are claimed than are intended to be awarded for any prize level, the intended prizes will be awarded in a random drawing from among all verified and validated prize claims received for that prize level. In no event will more than the stated number of prizes be awarded.” The Kraft clause. In 1989 lawsuits were brought against Kraft in its “Ready to Roll” promotion where due to printing errors at least 10,000 entrants had valid claims to the one grand prize and as a result Kraft end up paying millions of dollars to settle these claims. Subsequently, companies inserted this “Kraft clause” in the rules for seeded games and it has been upheld a number of times, most notably in lawsuits involving the NY Daily News where seeding mistakes occurred. See, Sargent v. NY Daily News, 42 A.D.3d 491 (NY 2d Dep’t 2007).
  • “To obtain a list of the winners, send a SASE to …” The availability of a winners’ list is required under the laws of FL, MD, MA, NY, RI, TN (and MI and WI for in pack games).

There are, of course, many other provisions that should be included in the Official Rules, but at least now after you’re finished copying and pasting, and you are asked, “why is that in the Rules”, you will have a spiffy answer.

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