Why Your Sweepstakes Needs a Privacy Policy - Klein Moynihan Turco LLP

Why Your Sweepstakes Promotion Needs A Privacy Policy

Sweepstakes Privacy Policies: A Key Aspect of Sweepstakes Promotions

Promotional contests, giveaways, and sweepstakes are invaluable tools for businesses looking to attract new customers and build a customer database. Sweepstakes drive consumers to provide their information to a business in exchange for the chance to win prizes and other benefits. Please take note that, for each sweepstakes, a sweepstakes operator must provide a privacy policy that fully informs consumers about their information collection, use, and sharing policies. In addition to the general privacy policy requirements, sweepstakes operators must disclose any intention to use a winner’s name, likeness, and/or biographical information in connection with future marketing efforts.

Are Privacy Policies Necessary for Sweepstakes Operators?

Sweepstakes Privacy Policies

Failure to include a proper privacy policy in connection with operating a sweepstakes promotion could seriously undermine the business’s ability to fully utilize the consumer information collected during a given contest. With the right privacy policy and inclusion of proper consent language at the point of data collection, sweepstakes operators can build a database of consumers that can be contacted through e-mail marketing, telemarketing, and mobile/text message marketing (where permitted by law). Absent a privacy policy and informed consent, however, the use of entrant data for marketing purposes would likely violate applicable state and federal law.

Properly collected data from informed consumers will provide sweepstakes operators with a valuable source of potential revenue. Please note that the practice of collecting and storing data imposes a responsibility on sweepstake operators and their employees to safeguard such data. Various state and federal statutes require that sweepstakes operators distribute written policies on data security procedures to employees and notify consumers in the event of a security breach involving their data.

Using the Name, Likeness, and/or Biographical Information of Winners

Many sweepstakes operators are eager to use the name, likeness, and/or biographical information of winners in connection with promoting the sweepstakes itself or the operator’s products and/or services. However, without the proper disclosures in the promotion contest rules and the associated privacy policy, the use of a winner’s information in such a manner could be deemed to violate that winner’s rights of publicity, privacy, and other proprietary rights. Please be advised that certain jurisdictions, such as Tennessee, may require additional consumer consent outside of the privacy policy/contest rules in order to use a resident’s name and/or likeness.

Ensuring that Your Sweepstakes Privacy Policy Complies with All Legal Requirements

Given the considerable value of a database of engaged consumers, sweepstakes sponsors must take the time to ensure that would-be sweepstakes entrants are provided with a clear, comprehensive, and legally compliant privacy policy.

If you are interested in learning more about this topic or require the preparation of a privacy policy in connection with launching a sweepstakes promotion, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.

The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney. Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.

This blog post was originally published in 2017, and updated on January 3, 2021.

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Photo by Markus Winkler from Pexels

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David Klein

David Klein is one of the most recognized attorneys in the technology, Internet marketing, sweepstakes, and telecommunications fields. Skilled at counseling clients on a broad range of technology-related matters, David Klein has substantial experience in negotiating and drafting complex licensing, marketing and Internet agreements.
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