Thinking of running a promotional contest? Start here.

It’s easy to see why contests are a go-to for many organizations – they provide brand exposure and generate high consumer engagement.

The key is to create positive buzz and avoid common pitfalls that lead to consumer complaints and negative attention. So how do you do that? Let’s start with tackling some basic aspects of contests.

It’s important before launching a contest that the right team is assembled. Membership in this squad will vary depending on the organization, but should include marketers, legal, communicators, creative and digital content specialists. Why? Because: a) all the materials and messaging for the contest needs to be vetted, and b) everyone has a responsibility for your company’s activities and may inadvertently make changes that could land your organization in hot water. For example, shortening an e-mail subject line to make it punchier could expose you to contravening the law, since subject lines must not be misleading.

With the team in place, everyone should be aware that contests are governed by the Competition Act and Criminal Code. Many provinces and territories have lottery laws that could apply and some of them issue licenses. If a contest is offered in Quebec, there are further provincial regulations that need to be considered. Additional laws and rules also apply including, Canada’s Personal Information Protection and Electronic Documents Act (PIPEDA), Canada’s anti-spam legislation (CASL), privacy law and intellectual property (including trademarks).

Your legal or compliance team needs to be present early in the planning stages of a contest to provide guidance and ensure you are meeting all legal requirements. Provide mock-ups, key messaging and all the media types you anticipate leveraging before the public campaign begins so that they can provide the necessary feedback.

If you do not have ready access to legal advice, contact the Competition Bureau through its Written Opinion Program and request a written opinion on whether particular provisions of the Act are applicable. Build this into your workplan, as the Bureau requires time to respond, and note that there are fees for this service.

Compliance is critical not only for your brand’s reputation but also because fines for contravening the law are substantial. For example, the administrative penalties that can be imposed on individuals and companies for contravening the contest disclosure or civil deceptive marketing practices provisions of the Competition Act are:


Administrative Penalties

Individuals

Up to $750, 000 for the first offence
Up to $1 million for each subsequent offence

Companies

Up to $10 million for the first offence
Up to $15 million for each subsequent offence

Arming yourself with accurate information is vital, as is having the right people around the table within your organization as you are planning and brainstorming. Undertaking this ground work will best position your organization to minimize risk.

If you find yourself unsure of where to turn, the Canadian Marketing Association provides guidance and support to its members. Think of us as a resource.

To help members comply and navigate the regulatory landscape, CMA has resources and tools including its compliance and best practices guide on promotional contests.


Author: Florentina Stancu-Soare | Manager, Regulatory Affairs @CMA
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