How to Use Instagram Giveaways to Grow Your Business

how to run an instagram giveaway

Many small business owners benefit greatly from the use of social media. It can be an incredible way to connect with your current customer base and reach a new audience. 

Remember, you don't have to be on all social media platforms, just the ones where your current and ideal customers are. We have a post about this - how to decide which social media platforms to use for your business.

Today we'll be taking a look at Instagram and how some businesses can benefit from participating in a giveaway. 

The Goal of Instagram Giveaways

The goal of Instagram giveaways will be business specific but generally, most want to gain more followers and therefore more connection with their current and future customer base. 

Businesses who reach 10,000 followers and have their Instagram account set up as a business account (don't worry if you've already set up your account, you can switch to a business account at any time) gain access to the swipe up feature.

The swipe up feature enables you to add links to your Instagram stories and gets potential customers exactly where you want them: on your website. 

Having more followers also allows you to generate more enthusiasm for launches, keep customers informed about sales, and to convert more followers to customers. 

In short, it's about increasing sales. 

How Businesses Benefit from Instagram Giveaways

If you are selling a physical product and you are utilizing Instagram, you've probably considered doing a giveaway yourself or participating in one with other small business owners. Giveaways can be an incredible way to introduce a new audience to your business. 

Often, businesses who offer similar products may team up to offer a shop credit or gift card to each of their shops. This works especially well with online based businesses in similar categories.

For example, if you own an Etsy shop that sells baby products, teaming up with other Etsy shops that offer baby products may be ideal. You already know that their followers are interested in handmade baby products and your followers will probably be interested in theirs.

Could you view them as your competitors? Certainly. But that doesn't mean you can't work together to introduce your audiences to each other. This is particularly true in certain sectors where "community over competition" is viewed very positively.

Local business owners may benefit from giveaways as well.

If your primary following is local to your business, you could join with other businesses to offer a package of gift cards or services. This would only work well if all the businesses are local and have primarily local followers and are offering complementary or similar goods and services.

An example of this could be businesses offering home cleaning, car oil changes, and salon services teaming up to each offer one of their signature services. If their followers all live in the same area, there is great potential to gain new customers. 

Essentially, teaming up with other similar or complementary businesses means that you're sharing audiences and therefore gaining exposure to a new audience who is likely already interested in the type of product you're selling.

Types of Instagram Giveaways

There are three common types of Instagram giveaways:

Loop Giveaways

Loop giveaways are somewhat complex to set up, which is why this method is only recommended if you're doing a giveaway with about a dozen businesses or less. 

In a loop giveaway, each account participating in the giveaway posts a photo (sometimes all the same photo, sometimes not) at the same time.

The entry rules and explanation are included in the caption. Each business tags the next business in the photo it posts until the last participating business tags the first.


Business A tags Business B

Business B tags Business C

Business C tags Business D

Business D tags Business A

The entrants then tap the photo posted, visit the next business, follow them, and then click their most recent photo to see the next participant in the giveaway, and repeats. The entrant knows they've completed the loop when they get back to the original account they started with.

This creates a "loop" that entrants can quickly go through and follow and enables them to see your account page as they follow. 

The key thing about loop giveaways is that all the businesses have to actually post at the same time or the loop is broken. If Business C in the above scenario forgets to post, the loop is broken and no one ever gets to Business D or back to Business A.

Additional entries to the giveaway are often offered by having entrants tag a friend in the comments. This introduces additional people to the giveaway and to your business. 

Account Giveaways

This type of giveaway involves making a new Instagram account specifically for the giveaway.

This new account then follows all accounts who are participating in the giveaway. When the businesses participating in the giveaway announce the giveaway, they instruct those entering to go to the new account and follow all accounts that the giveaway account is following. 

This method tends to lead to more follows because it is very easy for entrants to follow quickly. That said, they don't have to actually look at your account profile in order to follow you so this can lead to more unfollows after the giveaway ends. 

It is also more work up front, as a new account has to be set up. If you opt to do this type of giveaway, you include the terms and conditions in the account profile and generally post one photo to the account with the giveaway details. 

Independent Giveaways

You may choose not to team up with other businesses and to run a giveaway independently. This is a great way to reward your existing followers and encourage them to introduce your business to friends.

This is the easiest type of giveaway to run because you choose the prize, what an entry entails, giveaway dates, and the winner. 

For this type of giveaway, one entry is generally a follow and comment with additional entries gained by tagging a friend in the comments. This exposes a new audience (the tagged person) to your account. The hope is that these are people who would also like your product or service and be potential customers.

Instagram's Rules About Giveaways and Promotions

The most important thing when participating in a giveaway is that you do not violate Instagram's terms and conditions. Instagram has a list of promotional guidelines to help you with this. 

Prepare to Gain a Lot of Followers, and Lose Some

Depending on the prize, Instagram giveaways can bring you a huge number of new followers. Be prepared that you will lose a good chunk of them once the giveaway ends.

Whether it's that they weren't actually interested in your business or they only use their account to enter giveaways, don't take it personally. Filtering out those who aren't actually potential customers is a good thing. The hope is that you'll be left with people who are interested in engaging with your business. 

Should You Participate in a Giveaway?

If you're considering either putting together a giveaway or have been invited to participate in one, there are a few things to keep in mind.

Take a look at the other participants and see how many followers they have, what their Instagram aesthetic is, and if their business is a complementary to yours.

  • Would your followers like them? 
  • Would their followers like you? 
  • Is the prize something you feel good about offering? Is it appropriate to your business?
  • Does the business have good reviews of their goods or services?
  • Does the business owner seem reliable?

Though you aren't going into business with them, participating in a giveaway with other business owners (particularly if you don't know them personally in real life) does involve some risk.

If the giveaway fails somehow - one participating account doesn't send their prize or pay their portion, the giveaway seems somehow rigged, or no winner is ever drawn - there could be backlash and negative consequences.

Choosing Your Instagram Giveaway Winner

Choosing an Instagram giveaway winner doesn't have to be too difficult. If you have a smaller number of entries, you can manually add them to a spreadsheet and use Google's random number generator to select your winner.

If you Google "random number generator," this tool will appear at the top of your search results. You can then put in the number of entries and randomly select which line of your spreadsheet is the winner.

Take a screenshot and consider uploading it to your Instagram stories and tagging your winner - it's proof that you handled the giveaway fairly. 

If that sounds like too much, there are several tools available to help choose Instagram giveaway winners. An app like the Easy Promos Instagram Sweepstakes App allows you to choose a winner and makes it easy to include entries like tagging a friend. This app allows you to use it for free for your first giveaway. After that it is a paid service.

Another option is a tool called Woobox, which is similar to the Easy Promos Instagram Sweepstakes App but is utilized through their website vs. an app. They also allow you to run your first giveaway for free but have limits on the number of entries. If you just want to pick a winner from the comments of a post, they have a free Pick a Winner tool

Make sure you know how you're going to pick a winner before you select what a giveaway entry will entail. Some tools are only able to select a winner from the comments of a post. In that case you'll want to make sure that leaving a comment is required for entry.

There are more tools and apps available for choosing your Instagram giveaway winner. Many will ask you to log in with your Instagram account first. Make sure that you're reading the terms and conditions and that you fully understand what you are giving them access to before you log in with your Instagram account.

After you are done using the tool, you may want to remove them from your list of authorized applications.

To do this, visit your Instagram profile on a computer. Click the Settings button (circle to the right of the "edit profile" button) and then click Authorized Apps. This will bring up a list of all the apps that have access to your profile and data, as well as what date you approved this access. Remove the app that you used for your giveaway by clicking Remove. Generally it is best not to keep allowing unused apps or websites to have access to your account and data. 

Handing Out the Prize

Once you have selected a winner, you'll want to make contact by direct messaging them via Instagram. If you have a physical prize to send out, request their mailing address and mail the prize to them. If you are giving out digital gift card(s), you'll need their email address to send them the gift card(s).

Be Cautious of Your Frequency

It can be tempting after your first Instagram giveaway to jump right in to another one. You gained so many followers! Seeing that number go up can be exhilarating.

Before joining your next Instagram giveaway, consider when your last one was. How many photos have you posted on Instagram since then? Have you engaged with your new followers? Too many giveaways can turn people off and can lead to a decrease in followers and a loss of genuine customers.

Try It

Social media involves a lot of planning, strategy, and maintenance. It also involves some trial and error. If you're considering doing a giveaway, whether with other business owners or independently, try it! It may not be a game changer for your business but it could be.