I personally hold contests, when I send out gimmicks...
because it's nice to know somebody put effort in getting those for free. It's .. okay- I guess.
What is not okay is that case:
Instead of commissioning somebody the company/whatever makes a contest. Create our logo/create our website/create XY and you'll be given credit.
And some people freak out, go like aww and forget the fact that they do work for free that is supposed to be actually PAYED.
I *believe* there are some contests where you can bend that and say it might be okay. But normally it's not. I don't want to work for free for company XY just because they are cool. Or big. Or popular. Because I won't be able to pay my bills and have to work for getting credit.
Lew linked me something that might explain it a bit better:
I got a lot of mails with "I love you work, want to join our contest?". Er... thanks for the compliment, but no!? If you love my work and want goodies, send a proper request and I'll send you a price and than we can talk.
I know it's hard in the beginning to get good jobs. And good paying customers. Actually I needed .. uh... 5 years to get both. That might be a long time but I never participated in any "creative work for credit" contest, never worked my ass off for free and always - well, in the beginning mostly- knew how to pay my bills. I even sold tickets but you know what? I got payed for it.
A lot of people achieve that goal faster, a lot don't even come close to it. But keep your head high and don't feed the greedy monsters out there who don't want to pay for a job.