September 24, 2008
So you want to run a contest for your house?
My name is Ray Sinclair of Yachats, Oregon. I attempted to run an essay contest for our house, across the street from the beautiful Pacific in this bucolic little village on the Central Oregon Coast. My wife and I have owned this 2000 sqft, home for over 12 years. We purchased it in 1996 and spent the next year on renovations. It was our dream home where we had retired to spend the rest of our lives.
I will not go in to the details of why that balloon came back to earth with a resounding thud in 2005.
We had to down size our living quarters in early 2006 and as a result the Yachats house went on the market in May of that year. I had a professional appraisal done to get an idea of the price to set on the house. At that time there were NO, ZERO houses on the market on the west (ocean side of Hwy 101) available in Yachats, a very desirable address.
We tried the conventional approach, listing with the most successful realtor in the area.
In the following six (6) months the house was only shown three (3) times. WOW!!!
We decided to pursue FSBO. First we used the Internet, then doing the whole thing ourselves. We dropped the price the equivalent of the realtor’s fee, 6%, to make the price more affordable.
We held open house EVERY WEEK, Wednesday through Sunday, 10AM-4PM. WE did all the signs (right on Hwy 101) with balloons, made flyers and all the other things to draw attention to the house.
We had several thousand people through our open house during the following TEN (10) months. We would spend our “off days” cleaning and doing yard work plus maintaining our other living quarters.
We had taken out a bridge loan to buy the other house. We are retired folks living on a fixed income. The payments on the loan eroded our savings and I spent many sleepless nights pondering a solution. We had continued to reduce the price on the Yachats house during this period to the point of diminishing returns.
The central theme we heard during all the open house events was “ we love the house but can’t afford it”. One of my sleepless nights I had the idea of perhaps we could have some kind of contest, wherein the house is the prize and we at least cover the cost of the loan.
I knew that in this state there are no other lotteries or raffles allowed other than those by charities and other 501C groups. I started making phone calls to the local government offices as to what other avenues might exist. Every one deferred to the State Lottery Board, who controls every thing related to any thing vaguely related to gaming.
I found out that there was a niche referred to as “skill contests” that might fit what I was looking for.
I knew that my individual inquiries would not get much response so I hired a law firm to dig into this possibility. After several weeks it was determined that indeed there was an area to work with.
Prior to proceeding I was advised to have a conditional sale agreement prepared.
I had an agreement drawn up under which my wife and I would sell the house in Yachats to the corporation for a predetermined amount at the successful conclusion of the contest. The corporation would then be the owner and award the prize(s). We would get our price for the house and all would be right in the world.
In the mean time I worked on a process and structure for a contest, stressing openness,
checks and balances, separation of managing the contest and the judging. What followed was a lot of flow charts with a process to direct the flow of entries. There would be a lot of revisions during the initial weeks of the contest.
I made sure to consult with the “legal eagles” on my process. A lot of attention was paid to the separation of judging and processing entries. The qualification of the judges was rather simple (so I thought). I wanted at least three (3) people with many years (read retired) of formal experience in education, preferably English and/or Journalism.
The hiring of suitable judges proved to be a formidable task. I ran ads and put out the “word” in the local community for candidates. I did not hire my last judge until 12/31/07.
All my judges were retired educators, all English teachers in Oregon. Each had 30 years of experience, in the classroom and some administrative.
The qualifications for the judges must include the disclaimed that there can be affiliation
or relationship with the contest/corporation organizers or their families.
In parallel I started the process of forming a corporation and all the related support required for a business, getting a PO Box, opening a bank account and hiring an accountant.
I had done a preliminary budget for the contest. I was required to capitalize the corporation (who owned the contest) and fund all the startup costs.
All the myriad details that popped up in doing these things related to law changes due to the Homeland Security caused many delays. Getting a Federal Employment # must be in hand to open business bank accounts (there must be a separate savings type account established for the “escrowing” of entry fees) with several photo IDs. To get a business PO box requires forms and IDs. NO funds shall be used from the “escrowed” account other than for prizes or refunds.
I had paid major attention to the plan for publicity for the contest. I did NOT do enough in this area. I had this grandiose idea that the contest, with only 3000 entries at a “bite size” fee of $200 would be a breeze for this house in Yachats. I thought that certainly the contest would be concluded within the State very quickly. What an opportunity!!!! A house across the street from the ocean for only $200!!
One of the early items was the development of a really good web site. I found a very talented site designer right in Yachats who walked me through the variances of this task.
I had looked for a good “domain” name for the contest/web site and found “win-this-home” was available. This drove the entity of the corporation and all related items of the contest. This should be moved up to a high priority in the large list of “things to do”.
In constructing the web site have a “contact us” page that links to your email. DO NOT list your email address/phone #/address. Construct an informational page about your specific local area, listing all the highlights/medical facilities/churches/schools/infrastructure of the community, etc. If possible include a map or, as I did, an aerial photo showing the geographical location of the house to the ocean and village. There are usually several web sites on your local area with some of these features that may be linked to your web site.
There was a growing buzz in our little village about the contest and word got all the way to a Network TV station in Portland. I got a call to see if I would like to get coverage on major network news. WOW!!! I was ecstatic!!!
The filming event was to come the first week of the contest, January 2. That was the good news.
The bad news was we were hit with the worst winter in Oregon in 57 years. The storms rolled in one after the other. High winds and heavy rain are the norm here on the coast but then we had snow in the local area, heavy enough to curtail traffic and affect safe travel over to the coast through the coastal hills/mountains.
The weather became the big news and we were called to say that our coverage was cancelled.
I started scrambling for media coverage. I was lucky enough to have several local folks with contacts and previous experience in the media business. We began a concentrated
Push for media coverage.
All this work paid off in mid January with terrific articles in the Register-Guard in Eugene, the second largest circulation paper in Oregon and the NewportNews on the coast. These articles were picked up in all the regional papers throughout the State and some bordering regions. Voilia!!! The entries began to flow in. I was getting a very warm feeling.
We kept the push on media with hundreds of press releases citing the articles. There are several web sites that facilitate contacts at all newspapers. They are subscription only but a very good investment.
I took out a radio ad in the largest chain of stations on the Coast with an interview on their talk show at peak time. It was my largest single expense for media coverage and was a major flop.
We got a call for AOL asking if we were interested in an article for their Internet Emagazine, CyberSpace and USNews Interent news.
Good things were happening!!! I was getting 50+ emails from my web site twice a day!! The web site administrator was reporting over a 1000 hits a day on the website for the contest!!! At the highest part of the contest in April we recorded over 4000 hits in a day!
At the conclusion of the contest we had over 67,000 hits on the site.
The weather continued to pound us on the coast. Our open house events were held every Saturday/Sunday from 10AM-4PM. We had over 300 people come through for tours some weekends. When the weather was bad we still got over 100. All the feedback was very positive. I began to get static from the City regarding my signs and had to change placement and styles several times. It makes no difference if you think you are right, comply. We were widely supported throughout the local area, excepting the usual small town very small minority. Roll with the flow.
I was besieged with requests for more photos of the house for the folks that could not get “over the hill” to the coast to see the house.
FINALLY the light bulb went off!! A video “virtual tour” of the house for the web site!!!
Better late than never. We had a local aspiring video cameraman do the filming based on a script I put together. Our web site administrator had a friend do the editing and a week or so later we had an entry level home tour on the web site to augment the photos.
The next week we got a call from ABC news from Portland and the Oregonian, the largest paper in Oregon for articles. We were on a cloud!!
The article for the Oregonian was mixed in on the business page with other alternative ways homes were being put on the market.
The coverage from CH2 was terrific. The day was beautiful, warm and sunny. The fishing boats were right offshore and the gulls were all about. The resultant video was aired on the 6PM Sunday news and again on Monday!! Wow!!. The footage was picked up by FOX (CH 12) News in Portland.
In June we got another article in the Register-Guard (Eugene) and the Newport NewsTimes. Both were very favorable.
The next day we got a call from a call from the ABC station in Eugene requesting coverage. The feature was shown on that station and all regional stations throughout Oregon. I heard from people as far away as IN, FLA and TX that it was carried there on local TV.
At this time we only need about 1000 additional entries (I don’t remember the exact #) and I truly believed we would rocket across the finish line.
For what ever reason it failed to happen. The entries got to about 2200 around the end of the month and I extended the contest another month (a option in the rules). I just knew we were going for the gold.
In the first 7 days of July I received only six (6) entries. I pulled the plug on the 8th and shut the contest down. The rest is old news.
The detailed instructions for contest entry and the rules evolved to resolve issues from emails asking for more details. No matter how well to vet these there will be small details that are caught by the thousands of people (hopefully) that read them over. It is best NOT to change anything in the rules unless absolutely required. Should you do so, ensure that you post the revisions on the web site with much ado. Explain changes on the FAQ page. Document all revisions and dates.
Try to make the rules as simple as possible. Some areas should be somewhat general and offer guides on the “FAQ Page” of the web site. The entry instructions should be simple, but I found that ever with that there are many folks that will not get it right, ever.
Make sure to require a SASE or an email address, specify it is for their return confirmation for the contest with their entry #. The importance of retaining the entry # should be stressed as the identifier for any contact(s) with the contest. Without the inclusion of an entry # there is no validation of the entrant.
Of all the things I did, I did NOT plan for failure in the contest and when it did fail I had to do a whole separate process for the return of entry fees. Some folks felt very put upon to send “another SASE” for their refund. Many people did not/could not find or know their entry # and this caused undue emails and work on my part, plus some people could not grasp the idea that I did not know who they were, sometime even though they entered under different name(s)/addresses/email address/could not tell me when their check was written.
The rules should cover procedure of fee returns in the event of the contest being closed due to an inadequate # of entries being received. There should be a statement in the rules and in the entry form regarding conditions under which, the contest may be closed by the corporation, followed by advisement to see the FAQ page for details/instructions.
The rules must have a statement regarding any potential refund. That refunds will be made by corporation check only, payable to the entrant of record, once proper ID has been established.
Back to the contest:
Develop a flow chart for the contest to allow for checks/balances, such as audits for entry errors and # assignments.
At any task on the flow chart ensure that there is a process to cover any physical action involved. If a form is required design one. Always date any transaction(s). If more than one person is involved, use initials also.
When the entry is received and logged in, it should be assigned an entry #. That # should be placed on the entry form and the entry # with the date, initials if required. The entry forms should be filed by entry #. The entry should be filed by entry #. If any extraneous data/paperwork accompanies the entry attach it to the entry form (use judgment as some very strange things may come in). Do not discard any envelope or mailing packing until the logging and deposit of fee is completed.
Always log the entry prior to any fee deposit.
Be sure to remove/blackout all entrant identifiers from the entry. If they are within the entry, contrary to the rules, black them out.
There can be no identifying names on the entries that go to the judges, just a #.
The entry log should record type of payment, check/money order.
Design a form letter to be returned to those that enclose a SASE. Include a statement advising any winner to consult professional tax assistance prior to accepting any prize.
Also note that this is not a charitable contest.
A separate form should be used for any email confirmations that are opted for at entry, requiring only the entry # to be inserted.
Prepare a Master Entry Log. This will be used to record all entries by entry #. Include columns for date in/method of pay/deposited date/name of entrant/address of entrant/email address (if provided)/confirmation sent (SASE or email and date)/refund sent/check #/date.
This log is the BIBLE for the contest and should be secure. If at all possible restrict the persons maintaining it very closely and perform periodic audits for obvious errors.
Deposits: Record all deposits by Date/Entry#. That saves extra work and stresses the importance of the entry #.
When compiling entries/confirmations/deposits perform this operation every several days to allow for having more entries processed at a time. “Batching” the work reduces start/stops of doing this daily, UNLESS your are incredibly successful and are inundated with entries (as I was at times). You will have to make periodic infusions of capital to the corporation. This will be noted as “loans” to the corporation. A separate agreement is required to document any loans to the corporation and how payment is to be handled.
In that you are essentially the corporation there must be documentation for the separation of entities for tax and legal reasons.
Make sure that you open a Monthly Journal to record ALL expenses and transactions, at least weekly. Perform a monthly balance of the books.
Salaries: The IRS specifies that the person hiring/paying the employees of the corporation must be paid equal to or greater than the employees. What a waste. I paid myself a salary same as the judges and put it right back into the corporation via loans.
You will have to carry some type of working mans comp on your employees unless you find a better way to pay the judges. This must be done all very legally as you WILL have people challenge the legality of your contest and turn you in to all kinds of State and Local groups, plus the threats of law suits. Just do the right thing and turn the “nut mail”, including emails, over to your law firm. After all, you paid them to ensure that your contest is all legal and sanctioned by your state.
Judging: Remember the flow charts?
After the entries have an entry # assigned batch the entries for judging.
Provide the judges a form for ranking the entries. I used a 1/2/3 scale, meaning the highest ranking could be a cumulative of either a 3 or a 9, as you choose.
The judges did not compare their scores to one another and turned in their sheets to me at the end of each judging session with their names/dates on the sheets.
I collected the sheets and compiled the scores on my Master Ranking log. I logged in all scores in separate columns, totaled the scores, initialed the Master Log, initialed/dated the judges ranking sheets and returned them to the judges.
As each judge ranked an entry they use an initial to signify they judged it. I only logged completed entries.
The judges I hired were just great. They were very professional and gave each entry their full attention. When the contest began to falter they suggested that we wait until a greater volume of entries are available then we could proceed. They fore went their pay until we could resume the contest. Alas, the volume failed to materialize and the contest folded.
Entries: All judged entries are filed by entry #. All judged files should have some indictor of having been judged, by each judge. Method is not important as long as it is consistent. I batched the entries, as they can get rather bulky.
And the winner is!!! I had developed my process to take the top ranked entries (the 3s or 9s) and pass them by the judges once again to end up with just the top 10. The judges would be allowed to confer with each other on this phase. When the final 10 were selected the judges could repeat this process again until the winner and three runner-ups were determined. I would have allowed them to bring in one additional outsider at this point if they chose.
The winner would have been widely acclaimed, as I had the media calling weekly to find out the results. Winners would be notified and the media contacted for the awards.
Alas, it was not to be.
As you can see there was/is a lot of work and attentiveness required. I essentially did all of this, excepting the judging which was not under the direction of me other than the original charter, “this is NOT and English exam”. The content or message of the entry was what counted. Originality and creativity were weight factors also.
It is important that the inner working of the contest be closely held and not for publication, except in general.
It is of utmost importance that the identities judge be very guarded. None of my judges were from Yachats and none had ever met one another prior to a meeting on 12/3107.
Good luck to all.