Hi Jazzy,
I've run quite a few different contests on my site - and have learned the hard way, the best approach is to make the rules crystal clear at the start, add disclaimers to cover yourself (some people are just downright greedy!
) and select the winner yourself, or with a core group of individuals such as those in your industry, etc.
Random drawings aren't a good idea I think - mostly because, no-one really going to go the extra mile to put in effort for your submission if it is just down to luck. And secondly, I think that technically - you need some kind of license to do that as it is effectively like a sweepstakes (don't quote me on that, but it's another reason to stay away from it!)
Otherwise, have a blast!
Contests are a lot of fun, and it feels really good to be generous with your community!
Cheers,
- Paul