Public Gaming July/August 2014 - page 22

that lottery’s not important, just that we have to apply the mer-
chandising and selling resources appropriate to the product.
Cross-Promotional and Couponing with
Corporate Retailers
Susan Strouse:
What could lottery do to integrate cross pro-
motion, couponing, loyalty programs, and more effective plano-
gramming into their relationship with U.S. retailers?
Anne Kerstetter:
Couponing should be targeted to a clearly
defined consumer group so that it can deliver something meaning-
ful to that group. Lottery needs to get more insight into the way in
which its customers can be segmented into more clearly defined
demographic profiles. That is how you will be able to formulate
strategy and promotions that appeal to your customer. Integrate the
couponing with your own Loyalty Programs, and with our prod-
ucts as well. And it would be great if we could refresh some of
the coupon tactics. Pictures and passing out coupons certainly still
work great. The redemption rate continues to be phenomenal. But
I think we need to start looking towards something more fresh and
new, perhaps futuristic methods of communicating to appeal to the
Millenials and attract new customers for both Lottery and Retailer.
Mark Hagen:
We have worked with any number of you on
some cross-promotion and couponing ideas. We’re big fans of that.
The broader the scale we can do it, the more impactful the initia-
tive will be. The only ask we have is that Lottery understands our
goals and integrates them into the equation. We have specific ideas
for what products a couponing initiative should promote. Help us
support our objectives, and you will sell more lottery tickets.
On Store Visits from LSR’s
(Lottery Service Representatives)
Anne Kerstetter:
CPG managers that service our stores typi-
cally are driving their product through the stores through merchan-
dising and working hand in hand with the managers of the stores.
While we certainly like our store management teams to understand
the products that they sell, their time is best served out on the sales
floor waiting on our customers. So we like to know that our retail
partners will help those managers understand the business, under-
stand where the growth potential is, and understand how they could
better merchandise and market the product. The LSR’s for our stores
do a good job. But I do think there are areas of opportunity to build
a better relationship with the individual store management teams to
make sure that they fully understand the benefits of driving lottery
sales and what that will do for our customers and store traffic.
Mark Hagen:
One thing that the lottery representatives could do
is to be very aggressive about getting us out of what is not selling.
Our store managers won’t do that for two reasons. If they have paid
for them, they won’t remove them until they’ve sold. And two, they
manage over 2,500 products and are not in the best position to con-
stantly assess the performance of each individual lottery ticket. You
may not like taking the tickets back but the result would be that we
would sell a lot more new tickets if you were proactive at moving us
out of the slow-sellers and into the more popular games.
The other thing that could be done is what Ann pointed out: in-
crease the number of visits from LSR’s. Some stores see an LSR
every week, which is great, but in some lotteries it is more like once
a month. You can imagine which stores sell more lottery tickets.
Anne Kerstetter:
Too, it is great when the LSR comes to the
individual stores armed with that store’s sales information. Not just
the corporate outlook that the lottery and our own headquarters tends
to focus on, but that specific store’s sales information. They have a
very open dialog with the mangers of those stores and it really has
helped engage those managers in understanding their own business
operations and knowing what products should be replenished and
what products are moving slowly and so should be removed. Our
lottery suppliers have a great return policy, so they can get the stale
tickets out of there. The lottery customer is smart, they know what
ticket they want, they know what prizes are left, they know what
they’re going to come in there and buy, and if it’s not there they’re
probably not going to buy anything as far as lottery goes. Like Mark
said, we really rely on the representatives that are coming into the
stores to help them understand the best way to manage it.
u
Public Gaming International • July/August 2014
22
You mentioned that many aspects of ad-
vertising and promotion will, of necessity,
always be implemented on a state-by-state
basis. I know there are lots of reasons why
each state needs to control its media com-
munications content and delivery. But some
things, like a TV game show that depends
on large scale to manage production costs
for each lottery, and for media contract
negotiations, really require big, national-
market scale. I’m hoping that the process
of figuring everything out for the Monopoly
Millionaires’ Club and its TV game show
might spawn new ideas, new ways to think
about the whole concept of national ad-
vertising and create a fertile foundation
for new approaches to overcoming the ob-
stacles to national advertising and promo-
tion. Maybe even help in the areas of data
collection and reporting that retailers are
demanding. And standardization of some
aspects of distribution infrastructure to
meet the needs of a Walmart.
S. Martino:
I hope and expect that the
innovative things being done for Monop-
oly Millionaires’ Club will be informative
and educational and that the experience
will stimulate fresh ideas for other games
and promotional strategies. Not everything
will be as successful as planned. But if we
plan carefully to manage our risk and set
reasonable expectations, we will continue
to grow and prosper. That’s the way prog-
ress happens, and, as far as I can tell, there
is no other way to drive progress.
u
Stephen Martino Interview
continued from page 10
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