I've never ran a contest on any of my communities before. I've thought about it in the past, but it just never happened. If I ever did get around to having a contest, the prizes would be most likely steam codes. I was going to host a challenge contest on VG Challenges when it was still around. (It technically is still around as Thee Zone.)
Running forum contest is among the easiest ways to boosting activities on your community. If there are decent prizes to be won at the end of the contest, it's going to bring decent activities for you.
I have a few times ran contests on my forums, not always for a money offer but sometimes for other prizes online such as VIP for a month on my forum for winning a contest.
Contests are great to help not only give back to the community but also help with engagement.
Contests can be done once in a while to boost the activities of the forum. But it should not be the main reason why members engage, especially if it has monetary incentives. It could do more harm than good.