Paul’s Take2 May 16, 2021

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Paul’s Take2

Like so many of you who knew Gary Gonder, we are shocked and saddened by his passing at the age of 62.  Gary was a “young” 62 in that he was always so fun to just be around.  Gary was also a highly respected leader in the lottery industry and in life and recipient of PGRI Lottery Industry Lifetime Achievement Award.  Click on the “In Memoriam” for Gary to read more about him.  We will truly miss him dearly.    

Yvonne Schnyder, serving the global lottery industry for 40 years, with the last 12 years as General Secretary of the World Lottery Association, passed away at 78 years old.  Yvonne was a special friend to PGRI along with the entire global community of lottery industry leaders.   

There sure is a lot going on in our industry now.  Every week there are new RFP’s (along with announcements of new contract awards) for sports-betting, iLottery, and retail modernization initiatives.  And even the most established game in the industry, Powerball®, is making a bold change moving from two drawings a week to three.  That will begin the third week of August.   

Further evidence of the outsized impact that sports betting will have on the games-of-chance industry in the U.S.:  online sports gambling websites invested $153 million into TV advertising, in Q1 of this year.  FanDuel and DraftKings led the way with $100 million in combined ad’ spend.  BetMGM also made a splash with a $25 million advertising spree.  And that is all in the first quarter alone.   “Post-PASPA, the rush by online gambling sites to invest in local TV has been head-spinning. Per Nielsen, the category dropped a mere $10.7 million in spot TV during the first quarter of 2019; in other words, investment in local TV has grown 14.3 times, or 1,336%, in two years.  By 2024, local spot TV is expected to increase its haul of online gambling ad revenue to as much as $590 million.”  Combine these data-points with the description of how online gambling is transforming the market-place for gaming.  Look at the article on the immediate impact on the Michigan games-of-chance industry. 

There has always been an expectation that no matter how fabulous the appeal of a new consumer product might be, it just always takes time to reach mass-market acceptance.  Combining the most comprehensive regulatory re-structure of gambling with this massive investment in advertising is re-shaping the entire gaming market-place in record time.  Massive change like this is not typically good for the market-leader, which in the games-of-chance space is Lottery.  But over the last number of years, and especially this past year, Lottery has shown a most remarkable resilience.  The popularity of lottery gaming just won’t quit, and it would appear to me that is not likely to change in the foreseeable future.  And now, Team Lottery (government operators and their technology partners) are on a tear, driving progressive innovation like never before.  The onset of the pandemic last March may have been the catalyst, but it is the success that followed that has demonstrated the positive impacts of a well-executed calculated risk.  Team Lottery has always had the most defensible business model and distribution infrastructure.  Now it has truly become the innovation leader in the games-of-chance industry.  That makes this window of opportunity the perfect time to step on the gas and secure Lottery’s strong competitive advantage for the next generation of industry leaders and players to enjoy.