Why Do Contests Have Small Prizes?

Contests are great because they’re a chance to win something for free. But why do they always have such small prizes? Wouldn’t it be great if there were more opportunities to win big prizes?

To answer this question, we need to go back in time a little bit and discuss the history of the contest. As with many other things in life, contests started as a way for the wealthy to show off their wealth. But once the concept took off, the prizes had to get smaller and smaller to keep with the theme.

The Early Stages

The idea behind contests is to give something away for free. But why give something away for free? In the early stages of contest history, wealthy individuals would give away large sums of money as prizes for contests. For example, in 1276, Peter de Rochemont, the French nobleman who established the Château de Chambord in the Loire Valley, France, offered a purse of ten thousand gold florins as a prize for the winner of a tournament he sponsored.

This sort of prize was unheard of at the time. It was literally a lottery win with no downside. The owner of the winning ticket would gain entry into a privileged circle of society and be able to demonstrate their wealth and generosity to the world. They were offering billions of dollars in prizes back then. It was a real ‘game changer’.

The Birth Of The Palette

But the concept of the contest did not die with the introduction of the lottery. After the success of the French lottery, other countries began implementing similar systems. For example, the Great Britain held its first official lottery in 1662. It was an extra £10 a week for churchgoing clergy to play. (Back then, a clergyman was the equivalent of a teacher, doctor or lawyer.) In the U.S., the first state-sanctioned lottery was South Carolina’s SC Prizes of 1922. (The acronym is an abbreviation of ‘South Carolina,’ ‘Pigskin’ and ‘Prize.’) These lotteries gave rise to a whole new genre of ‘game,’ which we now know as ‘pool.’

During this time, the palette of prizes became more diverse. To demonstrate their largess and generosity, the wealthy began giving away gold, silver and platinum coins, as well as other currencies. In some cases, they would give away entire estates. (Estates are the property or assets of a person or company; it is typically used to describe the ‘land and all its contents’ that a rich person owns.) But the prizes didn’t stop there. In the 1960s, film buffs would win Marlon Brando and Marilyn Monroe statues, and bikers would win Harleys and even Harleys themselves. (Marlon Brando and Marilyn Monroe are both famous American actors who both died in the 1960s. Harleys are a brand of motorcycle. The statue is a stand-in for the actor Marlon Brando, and the bike is a stand-in for the actress Marilyn Monroe.)

The Rise Of The Mega-Prize

The early stages of contest history were all about demonstrating wealth and making a grand display of it. But as time went on, that began to change. The prizes got bigger and bigger until they became nothing less than a showstopper. The most recent mega-prize at a major championship was the $15 million Grand Prize at the 2019 Powerball jackpot drawing. The previous record was held by the $14.63 million Powerball jackpot in 2018.

Why go large? Well, for one thing, it takes a lot of money to pay for prizes like that. Another reason is that people are beginning to see the value in giving something away for free. After all, if someone is willing to spend $15 million on a single prize, it must mean that there is some worth in offering smaller prizes for smaller contributions.

The Modern View

Today, the concept of the contest has evolved to include more than just paying for the prizes. Since the dawn of the 21st century, contests have included non-cash prizes, such as cars, trips, and even entire estates. (The biggest winner of the 2018 Powerball jackpot was from Pennsylvania, and they walked away with a $16.7 million Winnebago. And just this year, a man in Ohio won the lottery selling a ‘scoopee,’ a small coffee maker that can be connected to a coffee grinder. The winning ticket was sold in November of 2019.) In other words, people are beginning to see the value in rewarding good deeds with something tangible, rather than just giving it away for free.

The takeaway from this history lesson is that it is possible to have a contest with a huge prize. It just takes a bit of creativity and some serious planning to pull it off. For example, if you want to hold a contest for a trip to Machu Pichu, you would have to figure out a way to pay for it. Perhaps you could have a series of contests with smaller prizes, or you could set up a gofundme account to help raise money for your prizes. The key is to find a way to make it worthwhile for people to participate in your contest. (At the very least, it will make them feel like they are playing a part in something bigger than themselves.)

Why Not Have A Charity Drive?

One final thought before we move on: It is possible to have a contest where the entire proceeds go to a good cause. In fact, the Grand Prize at this year’s Powerball jackpot includes a $15 million donation to the American Cancer Society. (The money will go towards continued research for a better cure for cancer.)

This is a way for the wealthy to give something back to the community while still keeping with the display of wealth and generosity that is central to every aspect of their lifestyle. They are not shy about showing off their good deeds, either. At the very least, it is a way to make the world a better place.

So, to wrap up, why do the prizes for contests have to be so small? Well, it all starts with the prizes being so big. The more that money is on the line, the smaller the prizes must be to keep with the theme. But that is not all there is to it. The fact that everyone sees the value in giving something away for free is what causes the problem. Once you remove the shroud of secrecy that comes with every aspect of a traditional contest, you begin to see that there is a better way. (And no, we are not talking about getting a ‘loser’ prize. We are talking about finding a way to reward people for their contributions without resorting to paying for each individual prize.)