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Brazil Instants Games- Breaking out of the Poverty Trap

Brazil Instants Games- Breaking out of the Poverty Trap. Miami , October 25 th 2012. Regulatory Framework. Caixa Economica Federal Operates the National Lottery Some States are entitled to have their own lotteries (Decree of 1967).

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Brazil Instants Games- Breaking out of the Poverty Trap

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  1. Brazil Instants Games- Breaking out of the Poverty Trap Miami , October 25th 2012

  2. Regulatory Framework • CaixaEconomica Federal Operates the National Lottery • Some States are entitled to have their own lotteries (Decree of 1967). • The state lottery of Rio de Janeiro has outsourced its operation, with active oversight • Hebara runs Passive and Instant Games for the state of Rio de Janeiro

  3. Sales Source: La Fleur, IMF, Caixa, Hebara

  4. Latamvs Top 25

  5. Latamvs Top 25

  6. Poverty Trap LOW RETURN TO STAKEHOLDERS

  7. Best Practices • Price Points • Prize Payout • Prizes • Distribution • Branding

  8. Turn Around – Jan 2011 • Collaborated with law makers showing the need to make regulatory changes to allow for an increase in payout • Increased payout from 50% to 56% • Increased number of retailers by 50% • Introduced R$2,00 and R$ 3,00 price points • Introduced new prizes to appeal to different consumers • Initiated Marketing Campaign – Branding

  9. Sales Performance – Jan 2011 to Aug 2012 104% Increase

  10. Challenge Need to Increase Sales Still Further

  11. Growth Cycle HIGH RETURN TO LOTTERY BENEFICIARIES

  12. Higher Price Points – US Market Source: La Fleurs

  13. Higher Price Points –Italy Italy Source: Scientific Games

  14. Increase the Reach of Instants ODDS JACKPOT GAMES PASSIVE GAMES INSTANTS PRIZES

  15. Expansion Plan 2012 • Reduce retailer comission from 15% to 10% • Guarantee minimum nominal average of last 3 months • Increase payout to up to 70% (63% avg) • Introduce TBVS based on mobile technology for ticket activation/validation • Introduce consignment • Implement a bigger product mix • Introduce R$ 5,00 ticket with 70% payout • Introduce new game mechanics

  16. Payouts vs Sales – US examples

  17. Payouts vs Sales – US examples

  18. Payouts vs Sales – US examples

  19. Payouts vs Sales – US examples

  20. Sales Projections

  21. Thank You!Karina.firme@hebara.com.br

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