AI-Generated Content and “Virtual Hosts”: Navigating New Promotion Compliance

Part 3 of a four-part series. In Part 2, we discussed the legal risks that influencers can bring to promotions. 

Another emerging trend is the use of AI-generated personalities, synthetic spokespersons, and automated social media accounts to promote campaigns. These virtual hosts may announce winners, answer entry questions, or guide participants through the promotion.  

A web search has found the first ever AI Viral Giveaway Builder from KickoffLabs. In addition to being easy to deploy, part of this pitch boasts: “The AI doesn’t stop there; it dynamically creates social share texts, drafts emails, sets countdowns, and presents ingenious ways to accumulate more points, thus ensuring the endurance of the campaign’s momentum.”

Being able to grow your business using promotions is appealing; however, be sure the risk you will carry is worth it.  So, while innovative, this creates new compliance considerations.

Participants must know:

• Who is sponsoring the promotion
• Who is conducting the drawing
• How winners are selected

If an AI system appears to be independently choosing winners without a documented, verifiable random selection process, the promotion may face credibility and fairness challenges. Regulators and participants expect that sweepstakes drawings are conducted impartially and can be audited if necessary. Records of a promotion must be kept because an audit can be requested by a regulatory agency or an Attorney General.

Transparency remains essential. Technology cannot replace procedural fairness.

In Part 4, we’ll wrap up this series with a look at why independent contest and promotion administration is more important than ever.