Business owners have a vast array of platforms and tools at their fingertips to promote and grow their social media audience and gain more sales. One of the most popular options available is social media giveaways.

But what are social media contests, and how do they work? Is there anything you need to know before committing to doing regular competitions or giveaways on social media?

Essentially, you run a contest through your business’s social media profile. To participate in the contest, people need to complete an action – such as following your accounts, tag friends in your post, answer a question or share a link to a blog post.

The action needs to be one that can be identified – such as putting a specific hashtag on a shared post. This is so the action and the person doing it can be easily tracked.

The aim of the action should always be about getting more exposure, likes and follows. This is because of the bigger your list, the more potential to expand your business and sales.

All the people that follow the directions are put into the competition. If they are chosen the winner, they will receive your incentive or giveaway.

Most businesses reward their winners with gift cards, free items or services or another relevant incentive.

Although there are many benefits to this type of competition, there are also setbacks that you should be aware of before jumping in and committing to regular social media contests.

Benefits of Social Media Giveaways

Grow Your Social Followers

This is the most apparent benefit of holding a social media contest. Whether you are a start-up or just wanting to grow your accounts or exposure, hosting a contest is an easy way to boost the number of followers you have.

Increase Your Sales

Contests allow you to get people to click through to your website or learn more about you. Without entering your competition, they may never have come across you. This gives you the potential for increased sales.

Boost Engagement

Depending on the type of competition, you can increase comments and engagements through competitions. Engagement is always good for a business because it grows loyalty and trust in your brand.

Understand Your Customers

By hosting regular social media contests, you get to know your customers. What type of contest are they more likely to enter? What products are they most interested in winning?

You can also ask them questions through the competition to learn more about them and their preferences. This can inform further competitions, marketing and future product formulation and launching.

Drawbacks of Social Media Giveaways

Low Quality, Fake or Bot Followers

The lower the entry-level of your contest, the higher the chance of engaging low quality or fake accounts. You can tell this if you continuously lose your followers at a high rate after the competition.

Let the Drama Unfold

Even if your intentions are good, you always have the possibility of having to deal with angry customers who weren’t chosen. This is even more likely if you formulate a competition where the winner isn’t selected at random.

You see this when you set yourself up having to adjudicate the entry – favorite meme or title to a post. This does promote engagement (which is a good thing) but if you choose to go down this rabbit hole, be prepared for disgruntled people messaging you because they didn’t win.

Regular and loyal customers who have been following you religiously can often miss out when they are chosen over a new, sometimes low-quality follower.

To protect yourself and diminish the potential for problems ensure your contest clearly mentions the procedure for selecting winners to avoid frustrating your regular customers.

Requires Time and Money

If you are a single operator or only have a small team, know that competitions, even simple ones, take time. You or someone else will need to carve out large chunks of time to answer questions, field submissions, search for the relevant hashtag (or whatever the requirements are for entering the race) and then ensure the winner receives the prize.

If you do this monthly, that can explode into a tremendous amount of time, even if you implement technology to help you out. You can always have a VA assist but becomes an overhead. Don’t forget to add in the cost of giving away a physical or service-related prize.

Although the competition aims to lead to increased sales and exposure, you still need to make sure you can afford the initial investment of time and money, however small that may be in the beginning.

Flopping Frustrations

Although you may not hear this in other blog posts, your social media contest may not be a booming success. They are time-consuming and social media is fickle. Suppose you don’t have enough followers for your competition to gain traction, or people aren’t interested in the giveaway. In that case, it probably won’t be worth your investment.

Of course, if it is just one flop, you should reassess and look at improving the offer or the strategies that you use. But if you find that you are continually not receiving the desired results, you should think about moving onto other social media actions that are less time-intensive.

Social media contests, particularly regular giveaways, can be extremely beneficial and create a lot of hype and exposure for your business. Leading to larger audiences and more sales. But the potential issues include a heavy investment of time and sometimes your money.

If you think this technique has merit, go for it. You don’t have to commit to a monthly giveaway straight up. Trial different types of contests and competitions to find the right formulation for your brand.

If you are ready to mitigate the potential issues while capitalizing on the benefits, you are definitely prepared to launch your social media giveaway contest. If you are interested in other ways to grow your social media and business take a look here.