Publishers Clearing House (PCH) has been awarding their Grand Prize winnings of $10 million, since 1988. They are an American legacy. Winners are visited by a representative from PCH, who shows up with a photographer, “flowers, champagne, and balloons,” creating quite the spectacle and celebration.
The organization started in 1953 out of the garage of Harold and Lu Esther Mertz. Their daughter Joyce Mertz-Gilmore also was a founding member. Initially, PCH did not award money but sold magazine subscriptions by door-to-door salesmen and through mail-order. They revolutionized the industry “by offering a selection of 20 magazines,” as opposed to only one.
It wasn’t until 1967 that they started issuing prize winnings. This development came about, in order to keep competitive with Readers Digest, who pioneered the idea. Initially, $1, $5, and $10 bills were given out, but these winnings did not generate much interest. That’s when the sweepstakes pot went up to $5000, which was a definite game changer for the company! By offering a sweepstakes, as opposed to a lottery, anyone could enter, regardless of whether a purchase was made.
By 1981, PCH’s was making over $48 million in revenue, which more than doubled in 7 years time. Following suit, the Grand Prize winnings increased to $10 million in 1985, after competitor American Family Publishers raised their stakes from $200,000. Over 7.8 million people were subscribed to PCH and received mailings including the “millionaire-of-the-month, fast 50s ($50,000) for early entrants, and car giveaways.”
More offerings came about in 1987, with the emergence of the “Catalog Clearing House sweepstakes.” This involved offering over 35 different items from various merchants, books, and other miscellaneous items.
The “PCH Prize Patrol,” where ecstatic winners were videotaped for television, came about in 1988. The addition of the website, www.pch.com, came about in 1999. Since then, PCH has delved into Facebook and Twitter marketing, where items are sold, promotions and wins are also offered. One can also follow their blog at http://blog.pch.com/.
During the 90s and the early 21st century, Publishers Clearing House’s success started to wane, apparently due to decreased interest in sweepstakes, the emergence of state lotteries, and loss of revenue from law suits. There were several concerns about their advertising and general publicity that did not show PCH in a favorable light. This also extended to their competitor American Family Publishers, who declared bankruptcy in 1999.
Settlements were paid out to individuals in all 50 states, due to some of their advertising. The word “finalist” was frowned upon and lead people into thinking they were winners. Also, the practice of asking for a handwritten map to one’s house was misleading. People, who had actually won, were upset because they weren’t informed that the payments would be paid out over the course of thirty years, as opposed to a lump sum. There were other complaints too. The class action case from Attorney General Kamala Harris lists examples of why many consumers felt deceived and/or dissatisfied.
This year marks Publisher Clearing House’s 60th anniversary. They have definitely weathered the times, good and bad, and are still kicking. They send out their mailers and promote their services online. Should you receive a phone call from someone claiming to be from PCH, rest assured that it is not them. They do not make phone calls, but instead relish in the spontaneity of televised, face-to-face announcements that a person is a winner. A list of previous winners may also be found online. For further questions regarding PCH, visit them at pch.com or call your BBB, today!
photo credit: <a href=”http://www.flickr.com/photos/riekhavoc/4482483106/”>riekhavoc (caught up?)</a> via <a href=”http://photopin.com”>photopin</a> <a href=”http://creativecommons.org/licenses/by-nc-sa/2.0/”>cc</a>