We’ve all thought about extending a competition, especially if it’s not quite going as well as we’d hoped, but what are the rules around extending a competition and how does it impact your terms and conditions, licences and even your entrants?
We recently had a client running a nationwide purchase-to-enter competition. The competition was going so well that they sold out of stock… They had a queue of customers waving money at them to purchase and enter the competition, but the warehouse was empty.
Not a bad problem to have… but there is a bad way to manage it.
They contacted us to check the laws around extending their competition until they could fulfil demand, allowing all those that wanted to purchase and enter to do so. Here are the results of our research and advice – the dos and don’ts when it comes to extending your competition.
Why would you want to extend your competition?
In the case of the client that inspired this article, running out of stock made them question whether extending the competition was a good idea or not, but there are other very valid (and common) reasons you might be thinking about extending your competition…
- You haven’t received enough entries yet.
- You haven’t achieved your goal yet.
- It’s so popular you want to give you audience extra time to enter.
- You’re not prepared for closing your competition yet.
Whatever your reasons for wanting to extend your competition, there are some dos and don’ts that apply, not just to ensure your audience are happy, but to ensure you comply with your legal obligations too.
Extending your competition – what to do.
DO RESEARCH THE LEGAL RAMIFICATIONS OF EXTENDING
When our client got in touch to find out the ins and outs of extending their competition, our first port of call was to contact our legal superstars at Legalite.
They had helped with the terms and conditions for this competition and were familiar with the client and the competition; so they were able to advise us on the best course of action. In this case and for this client, extending the competition was well within their rights, as long as they announced it publicly, amended their terms and conditions to reflect the new dates and extended any applicable licences and permits.
Every competition and every business is different though, so we encourage you get specific advice for your particular situation (and no, the lawyer didn’t make us say that).
DO CONSIDER THE CONSEQUENCES OF EXTENDING
Extending your competition isn’t simply a case of waking up in the morning, deciding your entries are a little on the light side and deciding to extend your competition. Job done.
You must consider the consequences of extending your competition.
If you’ve been promoting your competition successfully, then your audience are more than likely very aware of when they’re hoping to be announced as your lucky winner. Suddenly extending the competition will annoy people, so be prepared for whingers claiming it’s ‘not fair’ and consider the impact extending your competition will have on people’s perception of your brand.
Beyond moaning clients, there’s also the extra costs to consider, which brings us to…
DO TAKE EXTRA COST(S) INTO ACCOUNT WHEN EXTENDING
There may be extra cost(s) associated with extending your competition – extra costs that may help sway your decision to extend.
In our client example, as it was a game of chance with a close to $50,000 prize pool, they had NSW, ACT and SA licence amendment fees to take into consideration too. In Australia, each state has amendment fees of around $100 AUD per change, so whilst it won’t break the bank, it’s still going to impact your bottom line and may encourage you to stick with your original dates.
There may be additional costs to extending.
Other costs that may apply to extending your competition include additional promotional material, amendments to terms and conditions and additional subscription fees from competition apps.
Extending a competition – what NOT to do.
DON’T JUST EXTEND AND HOPE FOR THE BEST
The damage you can do to your brand both financially and legally by improperly extending your competition as well as the harm you can do to your company’s reputation should be enough to make you do your homework when it comes to competition extensions.
Deciding to extend your competition or giveaway, telling no one and hoping that fair trading won’t notice and people won’t complain is a very risky strategy and one we would NOT recommend taking.
DON’T RUN AN OPEN-ENDED COMPETITION
We see far too many competitions with movable close dates that suit no one but the company running the competition – or worse – contests with no close date at all.
Don’t be that company.
Stringing along your entrants until you’ve made enough money, got enough entrants or hit your goal is the fastest way to annoy your customers, not to mention very, very shady when it comes to the law.
Before you launch your competition, you should set a launch date, duration and close date in mind and communicate this clearly to your customers in your promotional material and terms and conditions.
DON’T KEEP EXTENDING YOUR COMPETITION
Besides costing you a small fortune in amendment fees, extending your competition time after time is a sure-fire way to lose your customers’ respect.
They’ve given up their time and contact details to enter your competition and find out if they’ve won your amazing prize, don’t keep stringing them along. Just like a really crappy relationship, they’ll get tired of your games and find a company – and competition – that treats them the way they deserve to be treated.
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What about shortening a competition?
There may be times when you’re considering cutting your competition short and picking your winner early. Again, there are rules, regulations and etiquette that apply to shortening your competition too.
Just as with extending your competition, you will need to research the legal implications of closing your competition early. In most cases the law would frown upon shortening a competition because you’re reducing someone’s chances to win (by restricting the time they have to enter), but again, seek specific legal advice relevant to your situation.
The amendment fees for your licences and permits will also apply. Amendment fees apply to changing anything at all about your competition and its T&CS, from dates, to entry methods to winner criteria.
The extra admin, legal consequences and additional costs involved in extending your competition may just put you off amending your contest (as it did in the case of our client). It’s always worth weighing up the benefit of more entries and a longer competition against the work and expenses involved to extend it.
Still not sure whether you can – or should – extend your competition, need a hand amending your T&Cs or licences? Get in touch with our team of competition experts and we’ll walk you through the ins and outs of extending your competition.