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// PUBLIC GAMING INTERNATIONAL // November/December 2015
PRODUCT DEVELOPMENT
When you think about the core product we deliver, it’s
not surprising that the desired experiences span all
ages. There is a player segment that wants to win lots
of money; a segment more interested in winning a little
money; a segment more interested in having some fun…
the list goes on.
Maturityontheproductlifecyclecurvehelpsusdetermine
growth steps for our lottery customers. When you have
clients who are performing at some of the highest per
capita and per retailer sales in the world, you have to be
prepared for the next phase of growth. Getting to that
next phase requires much more analysis and insight.
Hence, the segmentation work we’ve done is playing a
critical role in our near-term product development. Like
many large consumer product companies, we are actively
integrating it across all areas of our business to fuel
innovation. By way of example, HJ Heinz revolutionized
the pet industry by doing the same
1
.
In the early days of segmentation research, HJ Heinz
commissioned a study to understand cat food buyers.
At the time, cat owners had only two choices – ‘wet’
(canned) cat food or ‘dry’ cat food. The study revealed
that the buyers of these two products were very different,
especially in how they related to their cats! There was a
segment of wet food users that were so passionate about
their cats; they literally threw half of every can away
because it wasn’t ‘fresh’ enough to provide a second
meal for their beloved kitty. The result? The introduction
of three-ounce cans of wet cat food and the birth of an
entirely new higher price per unit product. The Cat Lover
segment was willing to spend pennies more to ensure
their cat had only fresh meals. It was a win for both the
company and the buyer segment.
Much like HJ Heinz used segmentation to change the
cat food business, Scientific Games has been changing
the lottery world. And we will continue to do so with
refreshed vigor. One example of this has been our new
Pop n’ Pak
—an instant product that tested highly with
the Fan and Friend segments, which make up 88 percent
of total instant game spending.
Pop n’ Pak
also tested
well as a gift product that any segment might purchase.
Because of these results, we are confident that we have
launched a new product into the market that appeals
to segments more inclined to come into the category
occasionally, while also not alienating those who are
committed to the category. Our hope is to abandon
the old questions about new players and Millennials
and change the conversation to reflect more actionable
approaches:
MARKETING
We would be remiss if we did not make a distinction
between product development and marketing as it
pertains to generations. When you start developing
products aimed at particular demographic segments,
you are much more likely to miss the mark than if you
develop with motivations and needs in mind. Take, for
example, the recent mishap experienced by Whole
Foods, an American supermarket chain specializing in
organic food
2
. The company received backlash after an
announcement that they would develop streamlined,
tech-savvy stores with organized and reduced organic
selections at lower prices, specifically for Millennial
shoppers. This implied that Gen X and Baby Boomers