Legally all promotions fit into one of these three categories and it's important to understand them and the requirements you must meet to stay in the clear (we'll cover more of the specifics in a bit).

• Sweepstakes are prize giveaways where the winners are chosen by the luck of the draw. Prizes can be almost anything you can think of, from handmade cards to an all-expense-paid trip.
• Contests choose a winner based on some merit. The winner is chosen based on some criteria such as best photo, most votes on a video, best recipe, etc.
• A lottery is a prize drawing where people must pay money to buy a chance to win. Lotteries are highly regulated and should not be run without consulting legal counsel.

This guide will focus and provide a breakdown for running an effective viral contest. Contests are especially successful at creating buzz about your blog/product/service, backlinks and SEO, and of course, more traffic!