Make Money Running Competitions
Over the years we've come across many siteowners and promoters who want to use competitions to earn revenue from their site! However is running a prize promotion the quick path to untold riches? We're not so sure it is and we've been doing this for 23 years online. In our view it is very difficult to generate revenue with giveaways. Of course it's not impossible! Pick My Postcode is a good example of a prize draw site that has worked but there have been countless clones of PMP which haven't been remotely successful.
What we can tell you is that people who like entering competitions do shop online, but not always whilst they're entering prize draws so keep that in mind. You may need to incentivise them to buy there and then (e.g. discount codes) or make sure you're in a position to remind them about your site (e.g. collect data and email them). Compers are also quite savvy when it comes to marketing so asking them to sign-up to countless offers that generate you cash for leads may turn out to be unfruitful. Here are some ideas how you might be able to earn revenue from competitions....
1. Affiliate Marketing
We've used affiliate marketing links from Awin in our promotions. For example asking users to visit a site to check a price of the prize on offer. This is a useful tool for merchant and product promotion, but it doesn't always generate instant revenue. If you're working closely with a specific merchant you might be able to get extra commission or payment from them in exchange for your promotion. They may even donate a prize but you're going to need to demonstrate why your promotion will be effective.
2. Competition Sponsorship
PR companies often ask bloggers to post their content and will pay for the privilege. Likewise you could ask for payment to run a competition on behalf of a sponsor. However, note that a sponsor, or PR company may donate a prize and regard that as part or all of your "payment". These days you also need to be upfront if you're being paid for this kind of advertising.
3. Data Collection & Selling
Payment for leads is popular for competitions! You run the promotion and get paid per qualified entry by the sponsor. You may have to provide the prize, so make sure you figure your costs versus entries! Alternatively you could collect data and try and sell it - not always easy! Note that many people now regard large data collection type sites such as MyOffers as "spam".
4. Co-Registration Competitions
Some sites use co-registration to generate revenue from their prize draws. Entrants fill in their details and are then shown offers and promotions. If they sign up - you get paid. You used to be able to pick up a few co-reg deals via affiliate networks but these have all but faded now. Alternatively you could advertise CPL affiliate programs after an entry has been completed on your site although we'd probably not list your competiton on Loquax.
5. Google Adsense
Some siteowners use adsense or similar on their competition pages to try and generate revenue. The best example of this is Pick My Postcode who have numerous Adsense units on their site. With a large audience returning daily to see if they've won a prize it can work out well for the host site. Note that you can't force or ask users to click on the ads - it's not allowed - and Google can (and does) switch off accounts it feels aren't following their rules.
6. Pay To Enter
Back in 2010 a few services starting offering SMS entry routes as options for running prize promotions. Promoters could earn a revshare on the sales. However the services didn't take off! These days most pay to enter giveaways are from ITV competitons or raffle sites. The latter sell tickets and when a certain number are sold then a prize is awarded. The value of the prize is usually a lot less than the income from ticket sales. This area of comping is becoming more popular in terms of sites numbers but not necessarily in terms of entries.
7. Win A House Competitions
OK this is a bit extreme but if you really want to try and make money from competitions then run a win a house competition! In 2020 a number of homeowners successfully used 'raffles' to generate winners for their properties and quite often brought in more money than the house valuation. However it's not all that straightforward as you need to consider legal fees, costs, admin, marketing etc. And if it goes wrong it can end up costing you money too.
It's Not Always About The £££'s
Remember that your competition can also be used to (1) promote your website and (2) build a mailing list/social following. You may not always generate revenue directly from a competition but it could be generating added value in other ways such as SEO, traffic or brand awareness. It's also worth considering when you'd like your user to generate you revenue! If you're after sales then they're more likely to be attentive after they've entered the competition so give them a discount code on the "thanks for entering page" or email them your latest offers.
However, if entrants aren't going to buy then think about how you can make them useful to you! Give them the tools to help promote your brand and competition further across the internet. For example try adding Twitter and Facebook links on your "thanks" pages. People who enjoy entering competitions do shop online and they do make recommendations when they've had good service. If you treat visitors to your promotions badly then that doesn't set a good standard for when those same visitors think about purchasing from you.