What happens when a contest goes awry? Sometimes, nothing, legally. That is precisely why companies pay promotional lawyers to write air-tight rules.

Recently, M&M launched its Join The Hunt Easter contest. On the first day, the contest had a technical glitch, and almost every PIN code entered won an instant prize.

Oops!

The people at M&M figured it out pretty quickly and fixed the problem. They were legally not obligated to award any of those prizes.

Why?

Because the rules stated:

If any electronic or other error occurs, such as, but not limited to more prizes are claimed/designated than are to be awarded, the prizes remaining after the error is discovered will be awarded in a random drawing from among all eligible Instant Winner registrations received by the Instant Win Game Closing Date.  In no event will the Sponsor be liable for more than the Two Thousand and sixty (2060) Instant Win Game Prizes as disclosed in the Official Rules.

From a marketing perspective, angering your customers, especially in this age of social networking, is not smart.  So, M&M apologized for not being able to award the instant prize and instead gave each winner a $20 gift, however, not until some damage had already been done.  (Discussions regarding the “M&Ms Fiasco of 2010” can be read on Red Flag Deals.)

Some people agree with how M&M handled the contest glitch, and others do not. I believe M&M did its best to handle the glitch. It took them so long to respond to the entrants because they did not have a plan to resolve such a problem, and the marketing department had to scramble to devise a damage control plan.

Contest sponsors must also be more careful when hiring an agency to run their promotions. When there is a contest glitch, it’s not the contest management company whose reputation gets sullied; it’s the sponsors. (Remember last summer when the IC Group didn’t buy a security certificate longer than the duration of the Pepsi A Flip An Hour promotion? How in the world could you screw that up?!)

Mars is a large corporation, so although, at the moment, their reputation may have gotten a bit dinged, it will be fine. (You are still eating M&Ms, aren’t you?)

What do you think should have happened when the proverbial ball was dropped?