Public Gaming Magazine January/February 2016

January/February 2016 // PUBLIC GAMING INTERNATIONAL //

erative relationship also informs our prod-

uct development and marketing processes,

and engenders a spirit of cooperation and

appreciation for the shared values that we

all have to serve the consumer in the best

way possible.

J. Kennedy:

Progressive retailers

think of lottery as a growth category

rather than a managed product category.

We show them what we mean by that and

why they should devote the extra effort

and resources to drive that growth. Cre-

ating an exciting in-store Lottery expe-

rience for the consumer not only drives

lottery sales, it drives store traffic and

shopper engagement in ways that drives

overall store profitability.

How is the “player-journey” model different

from a focus on just selling more lottery tickets?

G. Isaacs:

The player journey is the

means to the end of increasing sales. But

it’s important because it is a more expan-

sive approach to viewing the entire ex-

perience, how to add value to the entire

experience, and how that leads to player

loyalty and more engaged players–all of

which add up to increased sales.

It also forces us to look at our business in

fresh, new ways. It helps us to focus on the

real-world, and get past preconceived no-

tions about consumer preferences. Some

of the practices formed over the decades in

the lottery industry may no longer be rel-

evant. The player-journey model helps us

focus more clearly on the actual consumer

experience and evolve our games and over-

all approach to maximizing entertainment

value to the consumer. Scientific Games is

paying attention to our consumer research

and we are open to the ways in which our

research constantly reveals new informa-

tion, sometimes even contradicting prem-

ises that may have held true in years past.

J. Kennedy:

We are marrying our

primary research that yields insight into

human behavior with secondary research

that’s based on the immense amount of

Lottery-specific sales data. The informa-

tion reveals changes in consumer behavior

that, when combined with the primary re-

search, is yielding significant performance

differentials for us. At Scientific Games,

we follow the consumer, because selling

lottery games ultimately comes down to

what the consumer wants to purchase.

A great example of this is the assump-

tion that Millennials no longer like to

play lottery. The research, both primary

and secondary, confirms conclusively

that this premise is just not factual.

The data show that Millennials don’t

have as much spending power as 30 and

40-somethings, but that has been the

case in past generations and it is also the

case in the other lottery categories. But

the Millennial is demanding alternative

options to purchase lottery products.

Younger adults of today are not that dif-

ferent from those of past generations.

They enjoy lottery, and this is especially

true with instant games, which tend to

skew younger than draw games.

G. Isaacs:

There is also the fact that

Millennials are currently spending much

more of their income on housing, educa-

tion, student loans, and health care than

older generations once did at their age. So

the money pinch on the latest generation

of younger adults may be more acute than

it was in past generations. Our under-

standing that they like the games means

that the marketing challenge is less about

changing the games and more about mak-

ing the games visible, accessible, and eas-

ier to purchase for Millennials when they

choose to allocate a portion of their dis-

cretionary dollar to recreational gaming.

Lottery is a conservatively operated

business, as it should be. Lotteries have

a large revenue stream and tremendous

brand value to protect. And the foremost

thing they must protect is the consumer’s

trust and confidence in the integrity of

the games. They also have to protect the

loyalty of their core players who expect

to be able to continue to play the games

they know and love. We can also expect

that today’s 20-somethings will grow into

30-somethings with more disposable in-

come whose lifestyle includes mobile and

other new variables when it comes to play-

ing Lottery.

The success of the integration process of

Scientific Games was evident at the Glob-

al Gaming Expo (G2E) in Las Vegas, at

NASPL in Dallas, and next at ICE Totally

Gaming in London. Applying the technolo-

gies and solutions requires investment. How

can we as an industry unlock the resources

needed to turn this potential into reality?

J. Kennedy:

Investment is key. The

high profit margins on lottery game sales

create a significant return on investment,

increasing these sales a smart thing to do

to generate additional profits for the good

causes the lotteries support. There are

many very actionable ways to free up the

investment capital needed to optimize the

potential of this business. It just requires

a more flexible way of thinking about the

construct of the RFP tenders so that the

commercial community can bear some of

those costs and participate in some of the

profits of capital investment. It is a slam-

dunk win-win-win-win for everyone—for

government lottery, for retailers, for con-

sumers, and for the commercial suppliers

to the industry. Truly, the biggest winners

when investment capital is unlocked are

the good causes supported by government

lotteries. Scientific Games has the R&D

power, the technology, the game content,

and the deep knowledge of the govern-

ment lottery business to help this industry

realize its full potential. Let’s make 2016

the year that lottery builds on its tremen-

dous success and positions itself for many

more decades of generating increased

funds for good causes.

■