Is Your Lottery “in” the Game?

1. Marketing in a Competitive Gaming Environment… Is Your Lottery “in” the Game?

2. Integrated Marketing • Traditionally, it simply means that you have an integral message/strategy in each of these mediums…or a “mix” of advertising • Print Advertising • Broadcast Media • Online (Internet Ads – i.e. Pandora) • Social Media Platforms (Facebook, YouTube, Twitter…) • Outdoor Advertising (Billboards, Bus Wraps) • Point-of-sale

3. Which is most important? Why? • Lotteries should market to players where they can actually make a purchase… • Inside or Outside retail locations? • One Solution: Use a combination of both – with greater emphasis on outside messaging to draw customers in…only way to integrate a player is to get them close to your product (i.e. Internet purchase or in-store) • If you can’t get them in the store, how can you expect to drive sales? Lottery products are sold inside. • If you advertise a message outside, but don’t reinforce the message on the inside, does it get lost with other messages or forgotten?

4. How can we market in all these mediums and still expect players to purchase Lottery products at retail locations? • Idea: Pay and Play at the Pump • Fact…By 1994, 80 percent of gas stations use new “pay at the pump” technology – virtually all stores do today. Why are Lottery products not a part of this “order before fueling” technology? • Food for thought…Retailers gross profit is NOT at the tank (i.e. a retailers average profit on fuel is 2-3 cents per gallon versus 30 cents earned per soft drink)…why not incorporate technology that forces an in-store purchase? It’s a win-win!

5. How can we market in all these mediums and still expect players to purchase Lottery products at retail locations? • Idea: Pay and Play at the Pump Is this a good idea? Here are some questions to consider… • How many of you actually go inside a convenience store to pay for or purchase gas? • How many potential Lottery players do we lose at the pump every day/week/year? • Once a potential player drives away from a store location, how many people do you think will actually come back just to buy a lottery ticket? • How do we get our retail locations to value electronic offers for Lottery tickets just as they do a car wash or other things currently sold/offered at their pump?

6. Let’s Consider the Competition • Cigarettes, Soft Drinks, Chips/Snacks and other consumables • Other forms of capturing the entertainment dollar (movies, online purchases, etc.) • Other gaming products (i.e. Video Lottery)

7. Expansion of Gaming • Important questions to ask? • Will traditional lottery products be sold in these new video gaming locations? • How will they be positioned/located amongst other gaming types? • What impact will these new gaming options have on our “old” product mix (i.e. cannibalization of existing online games such as KENO)? • Was/is the internal competition of video lottery considered in marketing/advertising efforts for traditional products?

8. Impact of Player Preferences • How do you market to players with different preferences…can these strategies be integrated? • We know that traditional and VLT players have different preferences (willingness to take risk differs, preferences on where to gamble and how much to spend, customer service expectations, perks/benefits of being a player) • Although ever-changing, there’s one important thing to remember • ALL PLAYERS WANT ONE THING… TO WIN!!!

9. Solutions for Integrating Gaming Types • When you can’t beat em’, join em! • Host Promotional events and activities for traditional games in Video Lottery Gaming environments (i.e. Casinos/Racetracks)…at the right times (Draw Days, Bus Tours, etc.) • Advantages: • Broader product exposure • Upscale venues • Greater opportunity for sales - bigger risk takers • Less competition of other products like those sold in traditional gaming environments (i.e. soft drinks, cigarettes, candy, snacks, gas, etc.)

10. Solutions for Integrating Gaming Types Idea: Why not offer Jackpot games such as Powerball and Mega Millions on VLT terminals? • Integrating traditional products in a non-traditional environment means the products must look/feel the same as other games to be competitive. • Progressive jackpot games such as Ca$hola have had success in video gaming environments…why not Powerball and Mega Millions?

11. Play Your Favorite Jackpot Game Here…

12. Vendors and Lotteries must take an Integrated Approach to doing business • Vendors…Lotteries need your help! • Lotteries continue to be supplied with many ways to expand gaming to help increase revenue to the State, but few ideas have emerged on how to integrate gaming types for sustainability of traditional lottery products. • Do they matter? • Are they an important part of the product portfolio? • How do we sustain play of these products in a changing gaming environment?

13. Challenge: To develop an Integrated Plan that includes all product types • Vendors and Lottery Management must continue to work together, and subsequently Lotteries must work together • Lotteries must create a pipeline of knowledge – attract and retain employees who represent those we market and sale to (you don’t see the same people on CMT and BET or even MTV…know your audience) • Develop plans that are flexible…can adapt to differences in policy issues/laws and are able to be changed – “One-size, fits most” approach

14. Conclusion • Integrating our portfolio means that we have to be willing to move in a different direction…and take some risks! • Not proposing all the answers, but hopefully some potential results!

15. Conclusion • How will we get there?

16. THANK YOU!!