Charity sweepstakes can be an excellent option for fundraisers and a good alternative to raffles.

Whether you're a nonprofit organization, a community group, or an individual looking to make a difference, understanding when to choose a charity sweepstake can help you maximize your fundraising potential.

When to Choose a Charity Sweepstake

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Online Raffles have always been a popular way of fundraising for a cause. However, charity fundraisers be aware, raffle laws especially online raffle laws dramatically vary country by country, state by state, county by county and even city by city.

In the United States some states prohibit online raffles of any kind. In some states nonprofits and charities with a 501 (c) 3 status are permitted to run raffles. In some cases only if they have been established for a specific amount of time. Most often a license is required for a nonprofit to run a raffle and there are sometimes restrictions on the number of raffles that can run per year. Individuals cannot run raffles.

In addition all tickets must be the same price in some jurisdictions and in many jurisdictions tickets cannot be sold to anyone under 18.

Fundraisers must check and comply with local laws.

Sweepstakes are often used by charities as a legal alternative to an online raffle.  However local laws must also be considered before organizing a charity sweepstake.

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Sweepstakes versus Raffles

What are similarities and differences between a sweepstake and a raffle?

Entry Requirement:

• Sweepstakes: In a sweepstake, participants typically enter by submitting some information to enter, such as name and contact details. Entry is usually free, although a paid entry can be available as an option to enter.

• Raffles: In a raffle, participants typically purchase tickets for a chance to win a prize. Entry involves a monetary cost, and the number of entries corresponds to the number of tickets purchased.

Random Selection of Winners:

• Both raffles and sweepstake winners are selected randomly from all eligible entries received. The selection process is typically conducted using randomization tools (e.g. random ticket generator via an online fundraising platform) or a manual draw in front of an audience to ensure fairness and transparency.

Purpose

• Business Run Sweepstakes: Sweepstakes are often associated with businesses who use sweepstakes as a marketing tool to promote their products or services, increase brand awareness, or gather leads. Promotional sweepstakes prizes can vary widely and often include products, experiences, or cash rewards.

Charity Sweepstakes: Nonprofits also often run sweepstakes if local gambling laws prohibit them from running an online raffle. In the US individual fundraisers who are not part of a 501(c)3 organization often only have the option of running a sweepstake to raise funds as they are prohibited from running raffles.

• Raffles: Raffles are commonly used for fundraising purposes by qualifying organizations such as registered charities, or schools. The prizes are typically donated or sponsored, and the proceeds from ticket sales are used to support the cause.

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Legal Considerations

• Sweepstakes: Sweepstakes are subject to local laws and regulations, particularly concerning prize fulfillment, eligibility requirements, and disclosure of terms and conditions. It's essential to comply with these legal requirements to avoid potential legal issues or penalties.

• Raffles: Raffles as previously discussed are also regulated by laws which can be very stringent, depending on the jurisdiction. Organizations conducting raffles for fundraising purposes must adhere to specific legal requirements, such as limiting the use of funds and reporting financial information.

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How to Run an Online Sweepstake

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Free Entry Option

To run a charity sweepstake the charity should include a paid entry route to raise funds for the cause. However, to qualify as a sweepstake as opposed to a raffle a free entry option is also offered. Free entry is often offered by post.

When the purpose of the sweepstake is to raise funds for a cause, the number of free entries sent in by post is typically very low. Many charity sweepstakes receive no free postal entries at all.

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Entrant Equality

The free entry route should give the free entrant the same chance of winning as the paid entrants. One free entry should equal one paid entry.

Also, in the spirit of the sweepstake all entrants should have the same number of opportunities to enter. If an entrant can purchase 10 tickets or entries, free entrants should be able to enter 10 times. One entry per envelope sent by mail or post is typical.

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Free Entry Communication

The free entry method should be displayed prominently so it’s clear to entrants that an alternative free entry option is available. It shouldn’t be included in the small print. Where to send the free entries and by which date should also be clearly stated.

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Postal Entry Processing

Entries received by post need to be added to the draw. Ideally free entrants should receive confirmation of their entry in the draw in the same way as the paid entrants - via text or email.

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How to set up a Charity Sweepstake on GalaBid

With GalaBid, running a charity sweepstake is simple.

Our user-friendly platform streamlines the entire process, from setting up your event to managing entries. You can easily customize your sweepstake to match your fundraising goals and audience preferences, and our intuitive interface makes it simple for participants to enter and engage with your event.

Plus, features like real-time reporting and automated communications, help you can stay organized and informed throughout your fundraiser.

Here's how to set-up acharity sweepstake in four steps:

1. Set up a campaign on GalaBid and connect your Stripe account to receive payments.

2. In the Items section on your campaign dashboard Set up a raffle item

3. Include how to enter free of charge in the Item description - include the postal address, the contact details that need to be included in the postal entry and the deadline for postal entries to be received by to be  included in the draw.

4. Specify the rules around free postal entries. For example one entry per envelope. can be included in each envelope.

If you receive free entries contact helpdesk@galabid.com. Our team will amend your campaign settings to allow you to enter free entries received on your campaign.