9 Lessons I Learned from Running a Sweepstakes

This guest post is by Jonathan Thomas of Anglotopia.net.

A common way for a blog to build its newsletter and traffic base is to hold a contest. My blog, Anglotopia, has been around for over four years now and we’ve had various successes and failures with contests. Eventually we basically just stopped having them, as they really weren’t worth the time.

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Then earlier this year, an opportunity presented itself, thanks to the generosity of one of our airline partners, to hold a sweepstakes—this time the prize was a free trip to London. The airline would provide the tickets, we roped in some other partners to provide other aspects of the trip, and then covered the rest of the costs ourselves.

What followed was a huge lesson in how to manage a major sweepstakes—something we’d never done before. It was a true trial by fire. Here are some of the key lessons we learned.

Take what you think your server will need, and double it. We moved to a new server right before we launched the sweepstakes, but when the competition really started to get traction, our server couldn’t cope and crashed several times.

A major organization plugged the contest to their email list of 300,000 subscribers and the server just collapsed under the deluge. This leads to angry entrants who won’t hesitate to email you and complain, but it also hurts your credibility.

The biggest problem we had off the bat was finding a way to gather what we hoped would be thousands of entries. Because of compliance issues (explained below) and the types of data we had to get from entrants, we couldn’t use a simple Mailchimp form.

We needed a custom form that collected all the data into a database that we could download in Excel format to share with the partners, as well as automatically add to our mailing list. We also needed a service that would send entrants right into Mailchimp, rather than have us import the list (which creates more compliance problems). And we had to balance cost as well.

In the end we chose Formstack as we could easily scale their pricing to work with the number of entries we were expecting, and then scale it back down when the contest was over.

Because of the nature of the prize, the contest was only open to US residents in the lower 48 states. I got several dozen emails from Canadians who were cranky that they couldn’t enter the contest. They usually get a raw deal when it comes to contests like this. I wished I could have opened the contest to other countries, but realistically we just couldn’t.

Think about your target audience, and also think about who you’re going to offend when putting together the prize. We didn’t suffer any long-term damage from mad Canadians, but it wasn’t pleasant getting their angry emails.

People by and large are not easy to reach—even when they enter a contest. They’ve got lives, they’re busy, and most of the time they just don’t read the pages they’re looking at.

Keep entry to the contest as simple as possible—all we had was a form that people filled out, and even this proved too much for some people. You may be tempted to make a complicated process, but if you do this, you’ll just get more angry emails from people who just don’t get it. The KISS principle applies here: keep it simple, stupid.

A custom contact form feeding into a database is a simple enough solution to allows people to enter a contest. The problem we ran into that situation was that people using older browsers (*cough* IE6 *cough*) couldn’t see the form, period. I would get very angry emails from people wondering why they couldn’t see the form, despite instructions telling them it was there. Telling someone to use another browser just made them angrier.

So, my advice is: provide the form entry, also provide a hard-coded link to the form, and also have buried in the terms and conditions a way for people to enter manually. Also, it’s fine to use Facebook to generate entries, but I would not recommend making a Facebook-only contest, as this makes people who hate Facebook angry (and there are lots of them, I now know!).

The biggest issue you face with running a contest is complying with various laws and regulations which vary from state to state. I am not a lawyer: I am a small business without the resources available to hire a sweepstakes lawyer. So, I did the next best thing—I grabbed the terms and conditions from a similar contest, then just edited them to fit my site, and put everything under my LLC (in the USA, a Limited Liability Company).

Don’t even think of holding a sweepstakes if you’re not incorporated, as you can open yourself up personally to lawsuits. You’ll also need to check with your local tax authority about how to deal with the value of the prize. Most companies pass off the tax liability to the winners—something they’ll have to understand when entering.

When all was said and done and the sweepstakes was over, we added 15,000 people to our email list. We were at 1,000 before, so this provided a massive amount of growth. Good things happen when we deploy our weekly newsletter to that number of subscribers.

The problem, though, will be with the quality of your list. Sweepstakes listing sites picked up on our contest, so we got a lot of entries from people who wouldn’t normally visit our site and weren’t interested in our niche or our message. When we deployed our first post-content newsletter to our email list, we got hundreds of unsubscribes and spam abuse reports from people who couldn’t figure out who we were despite the fact that the only way they’d be on the list was because they entered the contest.

This is all well and good except that if you use a third-party service like Mailchimp and you have a high abuse rate, you’ll have your account suspended—no matter how much you’re paying them. The lesson here is that sweepstakes lead to a low-quality email list—we’re still shedding subscribers weekly three months on—but the list is still going strong and it’s been very worthwhile. There will always be list attrition, especially as your list grows.

To choose a winner—even if you have thousands of entries—is simple: go to Random.org and have it generate a random number between one and the total number of entries you have.

Choosing the winner takes five seconds. Contacting them and letting them know they won is a whole other matter. Set out in the terms and conditions that if they don’t respond within a reasonable window, you’ll choose another winner. Once you’ve contacted the winner, it’s your duty to make sure they are able to claim their prize, and that includes hassling sponsors. If your sponsors pull out after the fact, you’ll have to provide the prize instead to avoid a lawsuit.

I think this is the most fun part of running a sweepstakes—making someone’s day (or in our case, their year) by telling them they’ve won a major prize. The winner of our sweepstakes was very responsive and grateful for everything we were doing for them.

Despite the prizes being provided for free, it cost money to run our contest, and your costs may vary. We had to invest in server infrastructure, Formstack for data collection, and so on. When the contest was over, we had to upgrade our Mailchimp account to a much more expensive tier due to the size of our new email list.

You may also want to consider marketing costs—we got a lot of free promotion for the contest, so we didn’t spend much on marketing, but we had to have graphics made, and it’s not a bad idea to do some Google Adwords or Facebook advertising to get the attention of the right people. Ideally, the costs of running a contest will lead to direct growth in your business, so that it won’t matter too much.

Have you ever run a sweepstakes? What lessons did you learn?

Jonathan Thomas runs Anglotopia.net—the website for people who love Britain—it started off as a hobby blog and turned into his full-time job thanks, in large part, to advice from ProBlogger. He also runs Londontopia.net—the website for people who love London. You can connect with him on Twitter: @jonathanwthomas.

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6 Lessons I Learned Selling a $50,000 Website

This guest post is by Chris The Traffic Blogger.

My hands were shaking like crazy and I had to focus very hard on entering my bank account information correctly. Just minutes prior a buyer had been approved for my website on Flippa (see the actual auction page here), and I had to somehow manage to calm down to fill out my escrow payment options.

The bid was an astonishing $50,000!

Yeah, that amount was almost enough money for the down payment and closing costs of my first home combined. Even now, when I think about it, I still get chills up my spine at the sheer amount of money that my website sold for. If I had been a little more patient, I may have been able to sell it for closer to $75,000, especially with the steady $4,000 it was earning per month on autopilot.

Today I’d like to touch on six major lessons I’ve learned from selling my first website for so much money. It’s my way of saying thank you to Darren, Georgina, and all the contributors of this fine community for your support and advice over the years. Also to you, the reader, for your comments, emails, and patronage.

I felt that escrow was essential for providing a safe environment for selling my website. The way it works is like this: if the buyer cheats the seller, then escrow holds the money until the seller’s goods are returned. If the seller cheats the buyer, then escrow charges the seller for the transfer fee and cancels the transaction entirely.

I also liked all the options I had for presenting my information on Flippa, such as attachments, a chart of the last year’s earnings, and even Google analytics. All this information was readily available on the auction page, along with countless other little details.

The only major snag in selling the site occurred when the buyer couldn’t figure out how to use my EPP codes and login information to transfer domains from my hosting provider to his.

This was one of the reasons why I went through so much stress and agony trying to sell my website—I didn’t totally understand the process either, nor did I have the experience of knowing how to transfer the domains to the buyer.

I lost about three nights’ sleep before I calmed down enough to come up with a solution to the transfer issue. Instead of trying to get the transfers done between the two of us, I had the buyer change my personal information on the domains to his and also my passwords so that he essentially controlled my domains.

Now the transfer process was on the buyer, not between the buyer and seller, since he owned the domains. This decision allowed us to move forward with the escrow payment process, instead of getting bogged down in figuring out the technical issues of transferring between hosting providers. I think I actually had a few hours of sleep that night!

I had a blogspot.com domain changed to .org about two years into the site’s existence. When I went to enter my .org site’s age I put down three years. However, Flippa detected that the .org extension was only available for the past year and said that I was basically contradicting the evidence Flippa had discovered.

There was no way to go back without completely cancelling the auction, so I probably lost a few potential buyers to this mistake.

I knew why I was selling my site six months prior, when I decided that I wanted to focus on other projects. I intended on using the influx of quick cash and free time to build up other projects.

To achieve the selling of my site which was so dependent upon me to survive, I then had to go about the process of replacing myself with a team of writers that could blog in my stead. The new owner was pleased to see a writing staff, as that meant he could take over without needing to create his own content. This was the only reason I was able to sell the site in the first place—otherwise it would be like Darren selling problogger.net years ago when he was the sole contributor. It just wouldn’t have worked.

Google Docs were amazing for listing all the account logins, instructions, and writer information that was needed to run the site without me.

Given the time difference between the buyer and myself (I was on the US East coast; he was in Malaysia), Google docs provided us with a convenient method for storing information and communicating, and it worked out far better than hundreds of small emails would have.

I understand that you most likely do not have a website worth $50,000, but that you would love to get it to that point. If you are serious about blogging and want to turn your hobby into a business, then you need to create a sales funnel.

A sales funnel is simply a system for obtaining leads, building trust, and finally converting leads into buyers. Even if this is simply a post series that you link to, it’s better than nothing. Whether you use email marketing or advertise products on your sidebar, you need to have some method for determining how much money you can make per new subscriber to your site. This will enable you to make calculations regarding what services you could afford to outsource to and still make a profit while growing your site.

Even though building backlinks is crucial for growing your website, you still have to focus a large portion of your effort on your sales funnel, or else you’ll be gambling instead of taking calculated risks.

I’ve learned a lot from this process, and unfortunately I couldn’t possibly fit it all into a single post. I have compiled everything I learned from this experience into a downloadable report which can also be viewed online if you don’t wish to download it. There’s no opt-in: this is my way of saying thanks to you!

Have you ever sold a website? I’d love to hear what you learned from the process, too.

Chris is a self proclaimed expert at showing bloggers how they can get traffic, build communities, make money online and be successful. You can find out more at The Traffic Blogger.

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