The Challenges of Promotions and Giveaways for Consumers

What will the consumer need to do to participate in the promotion? What are the criteria for prize distribution? How will the giveaway be conducted?

The answers to these questions define the mechanics of the promotional action, where any error can lead to penalties such as fines and prohibition from carrying out free prize distributions (Brazilian Law No. 5,768 of December 20, 1971). 

Cases where many people participate simultaneously, for example, are dangerous (something very common when a large investment is made in media buying on open TV). User concurrency needs to be handled correctly in order to prevent the same prize from being awarded more than once due to a system error.

All promotions involving giveaways must be registered with regulatory bodies, including information such as the criteria for selecting winners. In the case of promotions with instant prizes, one way to define who will be awarded is a pre-established schedule of winning moments.

CWI generates this schedule with an algorithm designed to provide proportional chances. Times with a history of higher participation receive a greater number of prizes.

Experience with different promotions over the years has allowed the algorithm to learn how to identify peaks in participation. This decreases the possibility that so-called “promonauts” (people who specialize in participating in promotions) have any type of advantage over other participants.

This algorithm is just one of the elements tailor-made for Coca-Cola promotions. The particularities of each mechanic are created without limitations imposed by the platform architecture, building the means to achieve the company’s objective, such as boosting sales of a specific product or strengthening the relationship with a partner.

In addition, we ensure that the moment a person wins an instant prize is special, without unpleasant surprises. Continue reading to learn about another key consideration in promotion planning!

In the case of instant prizes, the mechanic CWI has been working with most frequently involves the pre-definition of the winning moments for participants. Being detailed with these timings is essential to avoid failures and frustrations.

CWI’s systems are built to support large volumes of simultaneous participation. The detailing is done at the microsecond level, ensuring that participation is exclusive at each winning moment.

In addition, the websites where people find out if they’ve won are designed to create positive anticipation, making the moment more dynamic and appealing. Animations are created according to the theme of the promotion, as in the example beside (the “Back-to-School Flavor” promotion).

When a promotion requires proof of purchase via receipts, a layer of complexity is added to the process. Since fraud cases are not uncommon, it’s necessary to be attentive to these situations by adding a verification and auditing step.

There are two most common types. One occurs when an employee of a commercial establishment participates in a promotion using fraudulent receipts, simulating the purchase of the necessary products.

Another type occurs when a consumer actually purchases the products but receives a fraudulent receipt as proof, unaware of the harm they are suffering. When the audit realizes that the pre-awarded person’s receipt is not registered with the Secretariat of Finance (Sefaz), a case-by-case analysis is performed to ensure that innocent consumers are not penalized.

The commercial promotions mentioned in Brazilian Law No. 5,768 are regulated, authorized, inspected, and sanctioned by the Ministry of Finance – more specifically, by the Secretariat of Prizes and Betting (SPA). The entire authorization and accountability process is carried out online, through the Commercial Promotion Control System (SCPC).

Conducting a giveaway without complying with the Ministry of Finance’s commercial promotion regulations can lead to a prohibition on free prize distribution for up to 2 years, along with a fine of up to 100% of the total prize value. This is why planning a promotion goes beyond actions with the public.

For example, the legal entity must be up-to-date with federal, state, and municipal tax payments and formalize the authorization request 120 to 40 days before the promotion begins. The fee, which is related to the total value of the prizes, ranges from R$27 to R$66.67, and the Authorization Certificate number must appear on all advertising material.

The necessary documentation for requesting authorization includes constitutive acts, negative or positive certificates, terms of adherence, proxy/responsibility terms, and a consolidated statement of operating revenue. In some cases, after authorization, the company must prove ownership of the prizes up to 8 days before the scheduled award date.

Another extremely important point concerns the registration of participants. It must include their CPF (Brazilian individual taxpayer ID), be done on a digital platform, and not allow participation from individuals under 18 years old. The responsibility for ensuring the confidentiality of this information rests with the company authorized to conduct the promotion, yet another reason why choosing the IT company in charge also has a direct impact on the success of the campaign.

CWI performs Strategic Software Engineering work, with tailor-made development. It allows flexibility in defining which technologies will be used.

Regarding cloud platforms, for instance, we can work with AWS, Azure, Google Cloud, and others. Since the tools of each are similar, our team is prepared to adapt as needed.