Competitions and trade promotions are a trusted way to gain a broader reach and build loyalty from your customer base.
But while you might be excitedly focused on the advantages of running a trade promotion and creating the collateral to promote it, there are a few rules and regulations that come with running trade promotions that you must follow. If you don't you could face a major fine or severe reputation damage.
Terms and conditions must be a key feature of your promotion. Not only because entrants do read them, but also legislation requires all trade promotions to have accurate terms and conditions attached and readily available.
Competition Terms and Conditions in effect create a contract between the Promoter (you) and the consumer. Therefore, non-compliance with the competitions will amount to a breach of contract.
What do terms and conditions need to include?
It is important that the Terms and Conditions accurately reflect your Trade Promotion and comply with the relevant State and Territory requirements. Notably, some states and territories require competition permits or authorities, and the Terms and Conditions must be submitted with the necessary applications.
Terms and Conditions Template
Start your terms and conditions by sectioning the key pieces of information.
This way entrants can jump to the section that they most want to read, e.g. to discover if they are eligible to enter.
For national Trade Promotions, the following will generally need to be included in the Terms and Conditions:
Your business details
Including your ABN. This needs to be clearly defined at the beginning of the promotion terms.
The promotion period
It needs to be made clear when people can enter the competition.
It is possible that a person might come across a promotion after the entry period is closed. By making the entry period clear you avoid any confusion you come across
You must define who can enter your promotion. Having a targeted audience is crucial to helping define who you market your competition to, but it also is important for matching a suitable prize with your eventual winner.
There are several reasons why you might want to exclude some entrants:
1. If your entrants can’t use their prize, it is probably best you exclude them from entering in the first place. E.g. Are you wanting to award alcohol as a prize? You’ll want to exclude minors from entering.
2. If you want to the competition to be purely for your customers, you can exclude anyone employed at your company, the company providing the prize and/or their families.
How to enter
This one might seem obvious, but your terms and conditions must outline what entrants need to do in order to successfully enter your competition.
How many times can your entrants enter your competition?
You might be running a competition where entrants can enter as many times as they like, or only once per day. Or you would prefer entrants are only permitted to enter once throughout the duration of the competition.
It is important you communicate the number of entries permitted. Not being clear here could open your business up to backlash, particularly among a dedicated audience who have accidentally disqualified themselves by entering too often.
You must outline exactly what your prize is (including the value of the prize), how many prizes are available, the method of claiming the prize, how winners will be notified and what happens in the case a prize is not claimed by the winner.
If you are running a game of chance, you must also state the draw date and method.
Similarly, if you are running a game of skill you must state the day the winner will be announced.
Some states have requirements on how you must notify and publish the winners of competitions so ensure you have a full understanding of what the rules are in the states and territories you are running your promotion in.
Any other relevant factors
Any other details of your promotion that might be necessary for an entrant to make an informed choice to enter the competition must also be written in your terms and conditions.
This could be anything from information about judging, how personal information collected as part of the entry will be stored, to if proof of purchase is necessary for the winner to claim the prize.
These will be specific to your promotion. The contents of most clauses will depend on the states and territories requirements and time frames, which must be adhered to when drafting competition Terms and Conditions.
A privacy clause
All promotions must have a privacy clause in accordance with the Australian Privacy Principles
While running a promotion can be a fun way to engage with your audience, if terms and conditions are not correctly written and shared it could lead to complications down the road. Promotion Wizard takes the stress of creating terms and conditions by allowing you to generate compliant terms and conditions (reviewed by a promotional law expert) within 24 hours. Try it today.