The season of hope and hype: It's sweepstakes time American mailboxes have been filling with invitations to instant wealth

January 17, 1993|By Michael Dresser | Michael Dresser,Staff Writer

There are nine zeros in $10,000,000.00. Nine lovely zeros, i you include the cents.

You can write it with fewer zeros -- $10 million, say -- but it isn't nearly as enticing.

Publishers Clearing House knows that -- it seldom drops a digit. Neither does American Family Publishers. And neither do the hordes of imitators filling your mailbox with zeros this month.

It's January, sweepstakes time in America, the biggest giveaway month of the year.

But it's not charity.

You can make a lot of money giving away money in America. Consider Publishers Clearing House, the oldest and best-known sweepstakes operator. The magazine subscription agency says it has given away $53 million in prizes since 1967, when its contest started. But the privately held, Port Washington, N.Y.-based company boasts annual sales "in excess of $100 million."

In the words of New York Times columnist William Safire, you must be "demographically dead" if you have not received an overstuffed envelope from Publishers Clearing House proclaiming you a "finalist" in its winter giveaway.

The letters cajole, beg and warn you not to throw away your chance. "You could actually be holding $10,000,000.00 in your hands THIS VERY MOMENT and lose it all because you didn't register your prize numbers," writes the company, whose contest will end with a Jan. 29 national announcement of the $10,000,000.00 grand prize number. "Don't let someone else walk off with your millions."

There are widespread suspicions about such sweepstakes -- that money isn't really given away, or that you can't win unless you buy a magazine subscription.

Apparently, these suspicions are unfounded. Consumer protection officials say the Publishers Clearing House sweepstakes, as well as those of rival American Family Publishers, are run in accordance with the law. And there are living, breathing winners who didn't buy any magazines.

Nevertheless, some tactics employed by Publishers Clearing House and other sweepstakes operators come perilously close to the line between permissible hype and illegal deception, say consumer protection officials and postal authorities.

For example, mailings are filled with not-so-subtle hints of

preferential treatment for those who order magazines -- something that would turn a sweepstakes into an illegal lottery if it were true. And recipients are warned that they might be dropped from future sweepstakes if they don't order -- a tactic that has aroused the concern of consumer protection authorities.

For many recipients, a sweepstakes mailing is no more than postal pollution, but for millions of others it's an invitation to a dream. Instant wealth, luxury cars, liberation from 9-to-5 drudgery.

Sure, the odds are long -- an estimated 1 in 1.5 billion for a $10 million grand prize, according to a Publishers Clearing House filing with New York state for a giveaway ending in January 1995. But isn't that better than having no chance at all? And people actually win.

Bob Castleberry, a former sales manager in Denton, Texas, returned his entry form in 1989 and won the grand prize with a number that was reassigned to him after some cynic failed to return an entry form.

Mr. Castleberry took his winnings, retired early and ran for mayor of Denton, a city of 68,000. He won the election. Now he owns a Rolls-Royce, a couple of ranches and is serving his second term. Oh, and he didn't buy a subscription.

Indirect benefits

Even for those who haven't won, it's not hard to argue that the Publishers Clearing House Sweepstakes has its role in the economy.

Magazines need readers. Publishers Clearing House finds readers for magazines. So, Publishers Clearing House not only helps magazines survive, but also promotes reading. And if it takes a little razzmatazz to create a more literate America, so be it.

"I think the general public is aware that it is just a promotional tool," said Michael Pashby, senior vice president of the Magazine Publishers of America.

Contestants often complain that the Publishers Clearing House mailing is too complicated -- with multiple contests to enter and stamps to be stuck in just the right place. But the company says simplified packages have been less effective in getting consumers involved with the sweepstakes and motivated to buy magazines.

If Publishers Clearing House makes a sale, it typically collects the initial subscription price as its commission, according to David Sayer, executive vice president for advertising and public relations. The company isn't paid by magazines to include them in its packets and doesn't sell or rent its mailing lists, he said.

Magazines included in the sweepstakes packets find themselves elite company. Publishers Clearing House represents such highly regarded publications as The Atlantic, Forbes, U.S. News & World Report and Consumer Reports.

Still, an association with Publishers Clearing House and American Family Publishers is a topic that makes some publishers uncomfortable.

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