Did you know that online contests and competitions have a 34% conversion rate? This is higher than any other type of content, making it a great idea for your business. Even better, about 33% of contestants are usually open to receiving information about the brand.
This means you have a grand chance to expand your brand and grow your business. Running an online competition is a great way to generate awareness, drive traffic to your website, and increase sales.
The questions are, where do you start, and how do you run a successful online competition? This guide covers the top steps to run an online competition and earn money!
Create a Business Plan and Budget
Before launching online competitions or online raffles, it’s important to create a business plan and budget. It’ll help you determine how much money you need to spend on the competition and how much revenue you hope to generate.
Creating a realistic budget is essential for any successful online competition. Make sure that all of your costs are accounted for.
Include prize money, marketing expenses, website development costs, and more. You’ll also want to factor in potential profits so that you can see how much money your competition could make.
Choose a Desirable Prize for Your Target Audience
The first step to running an online competition is choosing a prize. Of course, you’ll want to choose something that’s desirable for your target audience. The more enticing and valuable your contest prizes are, the more likely it’ll be that people will participate!
You should also consider what would appeal most to those who enter your competition. For example, if you’re selling clothing items on eBay, then fashion accessories or vouchers might make great prizes! If possible, try offering cash as one of the top three prizes to attract serious contestants with high bids.
Decide What Contestants Need to Do to Win the Prize
Once you’ve chosen a prize that your target audience will enjoy, it’s time to decide what contestants need to do to win the competition. There are typically two types of contests- popularity-based and skill-based. Popularity-based competitions require only that participants complete an action.
Skill-based competitions require more effort from those who enter. Now, if your contest requires minimal effort, people might participate without interest in your product. On the other hand, if too much work is required for entry, most consumers won’t bother participating.
Set a Realistic Opening and Closing Date for Your Contest
It’s important to set a realistic start and end date for your online competition. It can be tempting to make the entry period as long as possible to give more people time to join, but this could actually hurt you. If potential customers have too much time, they might forget to enter or lose interest before the competition starts.
A few weeks is usually enough time for most consumers. Just don’t drag out the process any longer than necessary by setting an unreasonably short window. We suggest between 25 days to 60 days so that contestants have plenty of notice while not giving up on their goals due to timing difficulties.
Constant Contact has you covered with the tools and expertise you need to get started. Check out their free trial today!
You should also consider whether or not you’ll allow for late entries. Will you be extending the deadline for those who have already started participating?
Prepare Legal Documents and Fine Print
Make sure to include a list of rules and requirements for contestants as well as information about the prizes. You might also want to make your competition legally binding by having all participants sign a waiver before they begin participating. This will help prevent potential disputes if someone wins or claims that they didn’t read the fine print.
Again, this is something you should leave up to legal professionals because it can be complicated. Most online competitions require accepting some terms and conditions at some point during entry.
We recommend making these terms available on your contest page. This way, interested parties have ample time to review them prior to beginning participation. Also, consider including disclaimers such as “no purchase necessary” and “void where prohibited.”
Build the Infrastructure You Need to Run the Competition
One of the most important steps when running an online competition is making sure that you have the tools necessary to run it successfully. This means having a reliable online competition platform. You also need social media presence, and an email list to promote your contest.
First, find the best competition website builder for the best competition website design. We also recommend setting up your own landing page on your company’s blog to make entering as streamlined as possible.
Get a CRM, Payment Provider, and a Bank Account
To pay out the winners of your online competition, you’ll need to set up a payment provider. This could be something like PayPal or Stripe. It’ll allow you to process payments and send money to the appropriate individuals.
You should also consider getting a bank account specifically for this purpose. It’ll be easier to keep track of all transactions related to the contest.
If you’re running a large-scale online competition, you might also want to invest in a customer relationship management software package. It’ll help you keep track of all interactions with contestants. It’ll also automate many tasks, such as emailing participants or sending them updates about the progress of the contest.
Make Sure Your Competition Is Legal
It’s also important to keep in mind that some types of competitions are illegal, and you’ll need to consult with your legal team before proceeding. For example, contests that require participants to provide credit card information to participate can get banks involved. They might not be the best option for all businesses.
Keep this in mind when assessing whether or not an online competition will work for your company. There could be consequences if it doesn’t meet legal requirements, especially if someone files a lawsuit against you later.
Make Sure the Process for Choosing Winners Is Transparent
One of the worst things you can do when running an online competition is to choose the winners in a way that’s not transparent. This will only breed resentment among participants and could even lead to legal trouble down the road. Instead, you should use a third-party tool such as Random.org or select entrants at random from a list generated by your software.
You could also use a judging panel made up of impartial individuals who have no connection to your company whatsoever. Whichever method you decide on, make sure that the process is clearly documented and explained on your contest page.
Creating a Successful Online Competition: A Guide
There you have it! These are the steps you need to take to create a successful online competition. Go through each step and ensure you take care of the finer details, so your brand reputation doesn’t suffer in the end.
Please check out more of our website for valuable content.