When you stroll through an airport just before you jet off on your holidays or on a business trip, you might have seen smartly dressed business people standing around a brand new car. These guys will be trying to sell tickets to people in order to try and win said car.
How many of you have walked past and simply thought: scam!
Well more often than not they are completely legitimate, they wouldn’t be allowed in there if they weren’t. In fact, the win a car industry is big money these days, and the fact that a lot of these companies are now based online means that the range and number of cars that are on offer have grown dramatically.
There are plenty of sites pushing these promotions, so we wanted to explain how they work and what you need to look out for to get the best deals. This article is going to be a general round up rather than an individual review of each site, so bare that in mind.
How do Win a Car Competitions Work?
The homepage for each of these sites will try and dazzle you with pictures of various flashy new cars. It’s worth noting at this point that each car runs in its own competition, so a ticket for one isn’t a ticket for all.
Once you have chosen the car that you want to try and win, you will then be able to see the ticket price for that car. Most competitions will have a limit on the number of tickets you can buy for each car, with a common figure being around 150 per player account. This is to prevent one player from buying all the tickets and effectively buying the car, even though that would cost them more than the value of the car, which we will address further later in this article.
The next step is for the player to complete some sort of competition entry. These will vary, but they can include a question that they need to answer or some sort of spot the ball game or something similar.
The player must select the right answer here as if they are wrong then they won’t have a chance of winning, even if they have paid the ticket fee. A lot of giveaways include relatively simple questions like the one below, but some are trickier and will require research. Spot the ball is on a different level altogether, which again, we talk about later in this article.
You then submit your entry and once the competition closes the draw will be made. If you’re name gets pulled out of the hat you will win the car you have bought a ticket for.
What about Insurance & Maintenance?
A lot of competitions actually include both insurance and maintenance for the first year of ownership. However, after the first year the winner will be on their own, so they will need to fund this themselves. Think about that before you try and win a Ferrari.
There are some companies that offer no help towards this at all, so you need to be aware of that too. Others will allow you to add these maintenance packs as an addition to the ticket. It might be that for an extra £1 per ticket you will also win £20,000 plus additional cost for fuel, insurance and so on, for an extended period of time.
How do the Companies Make Money?
The giveaway companies make money by selling enough tickets at a price that allows them a decent mark-up on the price that they paid for the car.
Depending on the site, some will allow you to order new cars, like BOTB (Best of the Best) and then allow you to order this car from the dealer in the spec you want, while others offer draws for older cars that they actually have in stock, such as Dream Car Giveaways.
Let’s run through an example of a giveaway on Dream Car Giveaway’s and try to see how they make their money.
Here we have a competition for a BMW M5. A little lower down the page you can see the spec of the car and it’s a 2005 model in Blue with 88,000 miles on the clock.
On the advert it clearly states how long the competition has to run before a winner is drawn. In this case it’s a little over 2 weeks, but it also states that there will be a maximum of 1275 tickets available for this draw. If we run a little maths, then we can work out that £12.60 x 1275 = £16,065. This is the maximum that they will take from the draw.
After a little digging on AutoTrader, we have found a very similarly spec’d car with a similar mileage priced at £11,950.
If we assume that this is the market value for this car and the price that Dream Car Giveaways has bought the car for initially, we can see that they would be set to make a profit of around £4,115 on this car alone. And chances are they will have paid below market value, too.
However, what if they were not able to sell the full allocation of tickets before the 15 day deadline?
These companies have provisions in place for this. They often state in their terms and conditions that if less than a certain percentage of tickets are sold, winners of the draw will take a percentage of the cash raised from ticket sales instead. So, if they have only sold £10,000 worth of tickets for this, they might offer the winner say, £8.000 (80%) as the prize instead of the car. This way they still make a few thousand pounds and they still have the car too.
The majority of the bigger sites do sell out though, and often quite quickly as well, so this default cash alternative rarely happens.
Can you Take the Cash Instead?
Some companies do allow you to take the cash instead of the car. This is actually a fairly common option, especially for those that might not be able to afford the running costs after the 1st year has been paid for. We can always find a use for cash though can’t we?
The cash value will be less than the value of the car. BOTB offer a cash value of 80% and will happily give the cash to the winner instead of the car. Given that their cars are all brand new and made to order by the winner of the competition they can be as flexible as they like, but companies that offer cars that are at their disposal aren’t as keen to offer cash and want to offload the car instead.
In many cases the cash makes more sense for the winner, even though they may be desperate to keep the £100k monster car they have just won. Even if you could afford the insurance long term, you wouldn’t want to leave it parked on the street over night would you?
The image above highlights the cash value that would be paid out on this £144,000 Honda NSX should the winner choose to take cash over the car.
Do People Really Win?
They do! One of the biggest marketing tools for these companies is to show videos of people picking up their new car or being surprised by the delivery. In fact, the winners videos are now so popular that lots of these companies have made successful YouTube channels off the back of them, which is an added revenue stream thanks to advertising.
BOTB have a huge social following with over 250,000 Facebook likes, 83,000 followers on Instagram and 35,000 YouTube subscribers. Showing people collecting their new cars and having the videos spread over social media is fantastic marketing as well as being great for building trust.
From the player’s point of view this inspires confidence, especially if the player is new. You can see timelines on their site of the people who have won along with a back story about who they are, so you can research the company and track their past.
What’s really fascinating is how these cars change people’s lives. It may be that they drive them for a while and then sell them to pocket the cash, or just that they take pride in being behind the wheel of a car they would otherwise not be able to afford. When the company turn up to surprise someone who’s clearly worked hard all their life with a brand new Aston Martin, it’s an impressive and heart warming moment, that’s for sure.
There are hundreds of articles from both local and national papers about people winning cars, but this one from a lucky BOTB winner stood out for us. Carlton Johnson-Vaughton was the lucky winner of a brand-new Mercedes AMG CLA35 Shooting Brake.
Carlton had also ticked the box to include the £20,000 worth of cash and the free motoring for a year option. But when interviewing Carlton, the owner of BOTB was shocked to hear that just 9 months prior he had a massive heart attack, and whilst he had fully recovered he said it changed his life forever.
How the Winners are Decided
With a lot of these giveaways the competitions are usually quite straightforward, like the one we spoke about earlier in the article. They might include a drop-down menu with a couple of answers that the majority of people are going to get right, but otherwise there’s not much of a hurdle to get over.
However, there are plenty of games that are actually tough to get right, such as BOTB’s spot the ball for example.
They require users to spot where the ball is from a photograph taken at a football match that week, but they want them to pin point the centre of the ball to within 1 pixel of the image. Given there are millions of pixels, it’s actually quite a tough task.
Above you can see a winning example of one of these images. The original would obviously not have the circle or the crosshairs, but this one actually shows the winner. The black cross hair is the exact centre mark and the blue cross hair that sits on top is the point that the winner chose. It’s worth noting that if there are no winners with the exact location, then it goes to the person who is nearest. You might not be able to tell here, but the winner is actually just out, but still close enough to win.
The centre mark for the ball is only roughly taken from where that ball is, it’s officially worked out by a team of independent adjudicators who come in to work with BOTB. The team sit and look at where the eyes of both players are looking, and then decide between them where the ball is likely to be.
It’s a highly detailed process and takes a good few hours to choose the winning spot. There is in fact a video on YouTube of how they work it out which is a fascinating watch.
BOTB actually get a letter from their external auditors and a solicitor with each competition winner to verify the authenticity of the result. This is not a line taken by all giveaway companies, so bear that in mind.
Are these Legal in the UK?
They are, but this is due to the fact that they are classed as a skill-based game and not a free giveaway or a raffle. This is why things like answering questions and spot the ball come into play, as they require some minor degree of skill to correctly answer or choose.
This makes the competitions technically not gambling.
These are the guidelines that are set out by the UK Gambling Commission who oversee all prize competitions as part of their line of work regulating the UK gambling industry.
If these companies were running these as a game of chance with no question or spot the ball, then the UKGC would class them as a lottery and therefore they would be illegal without a gambling licence.
How did They Start?
These sorts of giveaways and competitions first started throughout a series of airports within the UK. We’re pretty sure that most people who have been in an airport over the last decade or so will have seen a shiny car sitting randomly in the lobby at some point, with salesmen trying to sell tickets.
This is where the principle of these giveaways came from. The rules were a little different initially in that all you need to do to was buy a ticket to be entered into the draw, whereas these days they need to be a game of skill.
They soon moved from airports to big shopping malls, and then the biggest increase in play and exposure for the companies has been in online play. As we stated earlier, these are really well placed for social media trending and this has been one of the easiest ways for the companies to grow.