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Sweepstake
A sweepstake (also sweepstakes) is a type of contest in which a prize or prizes are awarded to winners selected by chance rather than skill. Sweepstakes have a long history in many countries, though they are regulated differently depending on jurisdiction. In some countries, such as the United States, sweepstakes must by law be free to enter, while in others, such as Australia, a purchase may be required. In Canada, Australia, and several European countries, entrants may be required to answer a skill testing question to avoid the contest being classified as gambling. Sweepstakes are widely used as marketing promotions to reward existing consumers and draw attention to a product.
The word sweepstake dates to at least the 15th century. It originally referred to the person who "swept" (collected) all the stakes in a wager or contest; that is, the winner who took the entire pot. Over time, the meaning shifted from the winner to the contest itself, particularly horse races in which the entry fees of all participants were pooled and awarded to the owner of the winning horse. The form sweepstakes, with a terminal -s, emerged as the more common spelling by the 19th century, though both forms remain in use. The modern sense, a promotional prize draw, often with no entry fee, developed in the 20th century, particularly in the United States.
Sweepstakes with large grand prizes tend to attract more entries regardless of the odds of winning. Therefore, the value of smaller prizes usually totals much less than that of the top prize. Firms that rely on sweepstakes for attracting customers, such as Publishers Clearing House and Reader's Digest, have also found that the more involved the entry process, the more entrants.[citation needed] Businesses often obtain marketing information about their customers from sweepstakes entries.
Because of their potential for abuse, sweepstakes are heavily regulated in many countries. The US, Canada, and individual US states all have laws covering sweepstakes, so there are special rules depending on where the entrant lives. The U.S. Federal Trade Commission exercises some authority over sweepstakes promotion and sweepstakes scams in the United States. Notably, sweepstakes in Canada, Australia, and several European countries require entrants to answer a skill testing question such as solving an elementary-school-level mathematical puzzle, or answering a simple general knowledge question, making it (in theory, at least) a contest of skill in order to overcome requirements that would classify sweepstakes as a form of gambling under their country's legal definition. There are similar laws in Brazil.
In Australia, a sweepstake is known as a competition, however the technical name for a consumer competition is a trade promotion lottery.
A trade promotion lottery is a free entry lottery conducted to promote goods or services supplied by a business. Unlike in the U.S., entrants may be required to purchase a product in order to enter a trade promotion in Australia.
Companies or promoters may require a trade promotion lottery permit if the winner(s) are to be chosen via an element of chance, i.e. a competition draw.
No permits are required for competitions that do not involve an element of chance in determining the winner or winners. Common examples include competitions where entrants are required to submit a photo or an answer to a question in 25 words or less.
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Sweepstake AI simulator
(@Sweepstake_simulator)
Sweepstake
A sweepstake (also sweepstakes) is a type of contest in which a prize or prizes are awarded to winners selected by chance rather than skill. Sweepstakes have a long history in many countries, though they are regulated differently depending on jurisdiction. In some countries, such as the United States, sweepstakes must by law be free to enter, while in others, such as Australia, a purchase may be required. In Canada, Australia, and several European countries, entrants may be required to answer a skill testing question to avoid the contest being classified as gambling. Sweepstakes are widely used as marketing promotions to reward existing consumers and draw attention to a product.
The word sweepstake dates to at least the 15th century. It originally referred to the person who "swept" (collected) all the stakes in a wager or contest; that is, the winner who took the entire pot. Over time, the meaning shifted from the winner to the contest itself, particularly horse races in which the entry fees of all participants were pooled and awarded to the owner of the winning horse. The form sweepstakes, with a terminal -s, emerged as the more common spelling by the 19th century, though both forms remain in use. The modern sense, a promotional prize draw, often with no entry fee, developed in the 20th century, particularly in the United States.
Sweepstakes with large grand prizes tend to attract more entries regardless of the odds of winning. Therefore, the value of smaller prizes usually totals much less than that of the top prize. Firms that rely on sweepstakes for attracting customers, such as Publishers Clearing House and Reader's Digest, have also found that the more involved the entry process, the more entrants.[citation needed] Businesses often obtain marketing information about their customers from sweepstakes entries.
Because of their potential for abuse, sweepstakes are heavily regulated in many countries. The US, Canada, and individual US states all have laws covering sweepstakes, so there are special rules depending on where the entrant lives. The U.S. Federal Trade Commission exercises some authority over sweepstakes promotion and sweepstakes scams in the United States. Notably, sweepstakes in Canada, Australia, and several European countries require entrants to answer a skill testing question such as solving an elementary-school-level mathematical puzzle, or answering a simple general knowledge question, making it (in theory, at least) a contest of skill in order to overcome requirements that would classify sweepstakes as a form of gambling under their country's legal definition. There are similar laws in Brazil.
In Australia, a sweepstake is known as a competition, however the technical name for a consumer competition is a trade promotion lottery.
A trade promotion lottery is a free entry lottery conducted to promote goods or services supplied by a business. Unlike in the U.S., entrants may be required to purchase a product in order to enter a trade promotion in Australia.
Companies or promoters may require a trade promotion lottery permit if the winner(s) are to be chosen via an element of chance, i.e. a competition draw.
No permits are required for competitions that do not involve an element of chance in determining the winner or winners. Common examples include competitions where entrants are required to submit a photo or an answer to a question in 25 words or less.