- You have won $125,000
in the Publishers Clearing House giveaway.
- Oh.
- [Host] You go right ahead and shed those tears.
- [Narrator] The Publishers Clearing House Sweepstakes
has been around for more than 50 years.
- I never knew there was this much money in the whole world.
- [Narrator] Inspiring generations of dreamers
with its commercials showing the iconic
Prize Patrol delivering massive checks to regular Americans.
- Honest to God, Marge,
I am not messing with you.
- [Narrator] Today, the company is still thriving,
bringing in $1 billion in 2017.
So how does Publishers Clearing House make this much money
when the company is known for literally giving it away
and paying millions more to settle lawsuits?
Publishers Clearing House was founded
by Harold Mertz in 1953.
Back then, the company only sold magazine subscriptions
and it became a pioneer in direct mail.
-This check from the Publishers Clearing House,
it's mine.
- [Narrator] In 1967, it started its first sweepstakes
as a way to entice people to buy more subscriptions.
- [Announcer] January 29th is coming fast.
That's when Publishers Clearing House announces
the winning number for $10 million.
- [Narrator] By the late 1980s,
Publishers Clearing House was a household name.
- I think that they've nailed it
in the way that they approach consumers.
They show people
that other people feel like,
look just like them.
It could be them.
And they show them getting this great big huge check
and I think makes other people kind of think,
well if it happened to them,
it can happen to me.
(crying)
- The emotion and joy that people showcase
when they're surprised and they win
is really kind of infectious.
- [Announcer] There's only one
Publishers Clearing House Sweepstakes.
- [Narrator] The marketing campaign worked
thanks to its exciting TV commercials
and signature manila envelopes
that arrived in mailboxes all over the country.
But by the 90's,
the company faced some trouble.
Numerous states sued the company,
alleging deceptive practices that made customers
think that the more magazines
and other products they bought
the better their chances would be of winning
the big money.
- Smart people don't enter those things.
- [Narrator] To be fair,
the company has been clear for years
that no purchase is necessary to enter the sweepstakes,
but apparently it wasn't clear enough
to the states that filed lawsuits against the company.
The trouble came to a head in 1999
when Congress passed an actual law
called the Deceptive Mail Prevention
and Enforcement Act to better regulate
Publishers Clearing House and companies like it.
- You've just won our forever prize.
(screaming)
- [Narrator] But that didn't deter millions
of Americans from coming back
to Publishers Clearing House.
The company currently has approximately
15 million registered users
and that's largely due to the company's pivot to digital.
In addition to magazines,
the website has thousands of items
of merchandise for sale.
- They're a really big digital business now.
They're still a mail order company.
You can sign up and get stuff delivered
to your home left and right,
but they have daily prizes all the time.
You can sign up for these sweepstakes.
- [Narrator] Another one of the company's biggest assets
is its customer's data.
- They've got a large customer base
that's really willing to give their data.
They've got people's names, addresses, ages.
People are very comfortable.
It's very direct and open,
and they're able to target them with advertising.
- [Narrator] When you sign up for access
to the Publishers Clearing House website,
it's easy to see why people would keep coming back.
An endless stream of opportunities to win cash prizes.
The High Roller Cashout.
The $1 Million Treasure Trove.
The Pinata Payday.
- They refer to it as gaming as entertainment,
or shopping as entertainment.
They've really mastered this idea,
it's almost like those scratch off lotto tickets
you can buy in the drug store.
They've created a digital version of that.
- [Announcer] Welcome to Inside PCH.
- [Narrator] The company broadcasts live on Facebook.
- Hello, everyone, and--
- [Narrator] Where users can tune in
and play along live with even more chances to win.
- So there's nothing to lose
and potentially millions to gain.
- [Narrator] Even though the company
has successfully adapted to digital,
Publishers Clearing House
hasn't completely escaped controversy.
In April of 2018,
a class action lawsuit was filed against the company
alleging deceptive practices.
In a statement Publishers Clearing House said
it would vigorously defend and fight
this matter that has no basis.
- You recognize us?
- I sure do.
- [Narrator] For years, the company has settled lawsuit
after lawsuit for tens of millions of dollars.
- Keep entering, you never know.
- [Narrator] Publishers Clearing House reveals
the odds of winning its sweepstakes
in the Official Rules section of its website.
According to Publishers Clearing House,
the odds of winning the company's
$1,000 a Day For Life sweepstakes
are one in 6.2 billion.
Compare that to the odds of winning the highest
Powerball jackpot of all time
at one in 292 million.
- You won $1 million!
(cheering)
- [Narrator] But one thing's for sure,
America is gonna keep playing
because you never know,
it could happen to you.
We reached out to Publishers Clearing House
with questions about allegations of deceptive practices
and how the company protects its customer's data.
These are the company's responses.
"Publishers Clearing House's broad range
"of chance-to-win opportunities
"are always free to play, fullY transparent,
"and easy for consumers to understand.
"All PCH sweepstakes promotions carry prominent
"and repeated no purchase necessary
"and buying won't help you win messages.
"We have comprehensive data security protections
"in place to ensure that all data provided
"by consumers is handled with the appropriate
"level of care."