Tag Archives: chance based competitions

Competition Fundamentals Part 2

bigstock--D-Illustration-Of-The-Words-E-55697162 (1)Less Common Competition Examples

If you are looking at running a simple chance-based competition it is pretty easy to confirm if competition permits are required. If you are looking at running a promotion that is a little less straight forward you may need permits from some states but not others. In this article we look at some less-common competitions and the need for permits.

Mixed games of skill and chance

Some promotions do not fit neatly into either category. The general rule is that you will require competition permits if there is any element of chance involved. An example of a mixed game of skill and chance might be where entrants need to submit answers in 25-words-or-less which are judged by a qualified judge but then given a chance to win a major prize by just participating in the promotion. To determine the major prize winner a draw might take place. In such a situation the whole competition would need to be reviewed by the state gaming authorities. In such a situation it may be possible to split the promotion if the Promoter were looking to reduce the cost of permits.

Online gaming tournaments and fantasy sports team

Online gaming, as a promotion, is becoming more and more popular. We recently set up these types of promotions for an airline and car manufacturer. Online promotional games are typically linked to the brand and may include a prize associated with the brand. These types of promotions may require an entrant to register online, for free, and then play games for a chance to win.

The first question to answer is whether the competition involves an element of chance in determining the winners or in breaking a tie between finalists. In the case of an online game where winners are drawn this is a relatively easy question to answer. In other cases the answer is not so clear, for example an online game where there is some element of chance which may influence an entrant’s likelihood of winning.

A fantasy sports promotion is a good example of this. Some elements of the game may be outside of the control of the entrant i.e. weather or number of injured players. We recently assisted in the setup of a fantasy sports promotion. We asked each state whether permits were required and ACT was the only state with a firm policy that permits will always be required for such a promotion. In such instances it is better to exercise caution and either apply for permits or get an answer in writing from each state gaming regulator.

First ‘x’ to enter

Another less common type of promotion involves awarding prizes to the first ‘x’ to enter either in-store or online. The Promoter will have a set number of prizes to give away. These types of promotions encourage a quick response from entrants who don’t want to miss out on a prize.
These types of promotions are considered differently in each state.

NSW will typically require a permit for these types of promotions if the Promoter expects to receive more entries than prizes.In SA permits will be required if the prize pool to be given away is more than $5,000. In ACT permits will be required if there is an element of chance in the determination or sorting of entries i.e. if entries are posted in and the entrant has no control over the order in which their entry is received.


How to set up a competition

By Connor James

The very first step in setting up a competition is to consider your objectives and the competition design. We discuss objectives and design further here.

Common reasons for conducting a competition include:

  1. To encourage loyalty;
  2. To increase sales of goods or services;
  3. To incentivise sales staff;
  4. To launch a new product or service; or
  5. To gain insights into customers.

Once you have decided to run a competition you will need to work out if you are going to run a skill or a chance-based competition. A skill-based competition is one in which the winners are determined on the basis of the skill shown in their submission and the winners are judged by qualified people.

A chance-based competition is one in which there is an element of chance in determining the winners. Competition permits are typically required for a chance-based competition. Click here for more information on when you will need competition permits.

There are a number of requirements which you will need to consider, all of which Permitz Group can manage on your behalf.

Thebelow diagram shows the basic steps involved in setting up a competition.