JV Giveaways to build your list--- or Not?

We begin this post with a story:

The beginning Internet marketer (usually an affiliate marketer) is always looking for traffic. Any targeted traffic is good traffic, and free traffic is preferred, at least until you are making money consistently.

Traffic is used to build your list, and eventually, your list begins to make some sales. The problem is, how to get more traffic to your squeeze page.

Along comes the JV Giveaway. It looks like it will be a perfect method of building your list. You sign up as a contributing member, choose a product to give away, and set up a new list on your autoresponder so you can track the results from your first giveaway. You submit your freebie and make sure the download link works. Everything seems wonderful, and as the opening day arrives, you check your email to see if the giveaway is producing any opt-ins. You see perhaps a couple in the first day or two, and the dreaded email from the giveaway hosts arrives: You haven't been getting any referrals (you haven't sent any new people that signed up as members) and your account will be downgraded from contributor to memeber if you don't get some referrals in the next 48 hours.

Panic sets in, and you hurredly post your link on a number of public forums, and perhaps get censured for possible spamming... Nothing seems to work and your account at the giveaway gets downgraded.

Your total sign ups? Perhaps four or five before you account was downgraded.

Sound familiar?

It doesn't have to be quite this way, if you fully understand the rules of most giveaways.

Yes, you are expected to promote the event, but if you don't have a big list, you aren't likely to get many referrals that way, and you certainly don't want to be considered a spammer. Fear not, there is a loophole of sorts...

With most giveaways, if you "upgrade" you not only get to give away several (often 4 or 5) freebies, you can also provide several items for sale. With most giveaways, the cost of this upgrade varies from $14 and up, depending on the host. There are a few that you can upgrade for only $5, but they are a bit harder to find. The upgrade benefits you in several ways. First, you can give away more products, and that means a higher potential for sign ups. Second, you can sell some products, and your sales pages or text ads can get you listed in several different areas on some of the giveaways. Last, and possibly most important for the newbie with a small or no existing list, many giveaways won't downgrade your account to member status if you don't get any referrals. This means you have a better chance of getting more opt-ins because you will remain a contributor for the entire event.

How to improve your opt-in rate:

Attracting people to your freebie(s) is key to getting opt-ins. Most people will tell you to use PLR as your freebie, but if your audience has already seen the PLR product you are using, they will pass it by. So how do you get more opt-ins? First, provide more freebies (by upgrading).

Second, use different and unique products. If you don't have your own already perhaps you can create some from the information you get from several PLR ebooks.

Still, there are two big questions:

Does the cost of the upgrade produce enough opt-ins to make it worthwhile? What most people think of as free traffic suddenly became paid traffic when you upaid your upgrade fee.

Given that the emplasis of a giveaway is free products, are the opt-ins more likely to be freebie-seekers, or will they become paying customers down the road?

There always seem to be a few of these giveaways active at any time, so they are certainly popular.

Anyone wish to comment on their experience?
Over time, what sort of opt-in rate do you typically see?
Also, do you see many sales with these events?