NY Lottery Instant Cash Games (ICGs)

1. NY Lottery Instant Cash Games (ICGs) Nittany Marketing Consulting Bela Florenthal Kirsten Grasshoff Lisa Laguna

2. NY Lottery ~ ICGs • Industry Analysis • Organizational Assessment • Marketing Engineering Analysis • Recommendations • Conclusions

3. NY Lottery ~ ICGs While online lottery sales are decreasing nationwide, instant game sales are increasing dramatically.

4. NY Lottery ~ ICGs • Industry Analysis • Organizational Assessment • Marketing Engineering Analysis • Recommendations • Conclusions

5. Interesting Lottery Facts • ICGs were the game of choice in 1999 (over Lotto, Daily Numbers, Keno). • ICGs averaged $78 per capita play in lottery states and $21 in non-lottery states in 1998. • 20/80 rule ($1,619 or more per capita) • Research is radically mixed as to whether income and education are positively or negatively correlated with lottery play

6. NY Lottery ~ ICGs • Industry Analysis • Organizational Assessment • Marketing Engineering Analysis • Recommendations • Conclusions

7. SWOT Analysis

8. Marketing Mix

9. NY Lottery ~ ICGs • Industry Analysis • Organizational Assessment • Marketing Engineering Analysis • Recommendations • Conclusions

10. Segmentation & Targeting Analysis: • Segmentation • Attitude towards playing ICG • Psychographics • Aspirations • General Interests • Targeting • Most profitable segments

11. Data Analysis • Factor analysis • Regression analysis • Answer the following questions: • Which segments should NY Lottery target • A layered understanding of key segments aspirations, opinions and interests

12. Predicted Model general interests psychographics aspirations attitude purchase

13. Model ~ Attitude Purchase Relationship Attitudes Hi-Risk Gamblers ? ? Lo-Risk Gamblers general interests + ICG lovers psycho aspirations purchase - Anti-Gaming

14. 1 ~ ICG Lovers More fun then other lottery games Playing is exciting Entertainment for your money Will win one day Never get bored 2 ~ Anti-Gaming Throw money away Silly game Immoral 3 ~ Low Risk Gamblers People play for risk Chance to change life Special trip to store Selection part of fun Makes day better 4 ~ Hi Risk Gamblers Everyone has the same chance to win Low risk way of gaming Can’t win enough Attitude Factors =.69 =.73 =.69 =.48

15. Model ~ Aspiration Attitude Relationship Aspirations Attitudes Luxury Desires ICG lovers purchase Family Needs Lo-Risk Gamblers

16. 1 ~ Luxury Desires Own dream car Own a large house Own a yacht Star in a movie Spend an evening with a celebrity 2 ~ Family Needs Put children through college Ensure financial security Eliminate debt Spend time with family 3 ~ Self Needs To retire early To own a home To travel 4 ~ Intrinsic Motivation To go back to school Work for charity Pursue a hobby full time Aspiration Factors =.56 =.83 =.40 =.51

17. Psychographic, General Interests & Aspiration General Interests Outdoor Attitudes Traditional Aspirations Sophisticated ICG lovers Luxury Desires Purchase Psychographics Lo- Risk Family Needs Discontent Success Oriented Self-Motivated Middle American

18. 1 ~ Discontent Can’t get ahead financially Want to change my life My life is out of control Money should be spent Live life in the moment 2 ~ Success Oriented I hate to lose Like to see results immediately Like to be considered a leader Impulse buyer Get bored easily 3 ~ Self - Motivated Things will go well in the future I like to do challenging things I do lots of interesting things I like to take risks I want to understand my inner-self 4 ~ Middle Americans My family is my life It is important to be patriotic Check and compare prices Prefer a quite secure life Psychographic Factors =.66 =.57 =.47 =.64

19. 1 ~ At Home Gardening Cooking Home Improvement Knitting & Sewing 2 ~ Outdoor Playing Sports Boating or Sailing Hiking and Camping Hunting and Fishing Exercise and Health 3 ~ Sophisticated Travel Reading Theater Visit Museums 4 ~ Traditional Collecting coins and stamps Playing board and word games Reading horoscope Cars General Interest Factors =.63 =.69 =.68 =.66

20. Analysis Summary • Target Segments =Hard Working New Yorkers w/ Big Dreams • They want financial security, more for their kids and time with the family • They dream about living big, big cars, big homes, big boats • They play for the fun of it and in hopes of fulfilling these dreams

21. NY Lottery ~ ICGs • Industry Analysis • Organizational Assessment • Marketing Engineering Analysis • Recommendations • Conclusions

22. People play for the fun They enjoy imagining the dream becoming a reality They enjoy selecting among the products They are not heavy gamblers They do want to see results and do want to win Offer a variety of games, Frequently change offering Offer very small chances of winning big Offer big chances of winning small Multiple chance tickets Price of ticket should range from $1 to $3 Develop a Marketing Planproduct & price

23. Develop an Advertising Plan Input • Understanding from Factor and Regression Analysis • Ad-Cad Recommendations

24. Benefit Enjoyment Benefit presentation Extremely positive Information Strategy One sided message Format Fantasy, exaggeration or surrealism Emotion in Ad Positive emotions Strong emotions Presentation technique Close up of brand Large ad Color illustration Imagery AdCad Results

25. NY LOTTERY INSTANT CASH GAMES, IMAGINE!

26. Insert your family here

27. A CHANCE FOR MORE Winning big with NY ICG changed our lives. We both still work but now we have enough money put away that Danny can go to any college he wants. And enough time for family vacations. Life is good.

28. NY Lottery ~ ICGs • Industry Analysis • Organizational Assessment • Marketing Engineering Analysis • Recommendations • Conclusions

29. Conclusions • Two key groups should be targeted • These groups are similar in terms of aspirations, psychographics and general interests • These two groups can be reached via a similar marketing campaign • Needs to be implemented in accord with legal and moral standards • Further research needed to address • Optimal media channels • Optimal distribution channels • Extent of product variety

30. Questions?Thank You

31. Model ~ Aspiration Attitude Relationship Psychographics Aspirations Attitudes Discontent Luxury Desires Lo-Risk Success Oriented purchase Self-Motivated Family Needs ICG lovers Middle American

32. General Interest, Psychographic Relationship General Interests Psychographics At Home Success Oriented Outdoor Family Needs Self-Motivated Sophisticated Middle American Traditional

33. Lottery Financial Summary

34. Lottery Trends • Blurring of the two types of traditional games into new breeds • Multi-state/multi-channel games (PowerBall) • Probability games • Games w/ options to upgrade • Americans are looking for digital lottery entertainment

35. Industry Promotion Trends • Channels • Television • Radio • Billboards • Point-of-sale • Internet • Themes • Size-of-the-prize (tied for most common) • Fun and excitement of playing (tied for most commonly used) • Winner awareness Design • Motivate non-players to play • Encourage players to play more often/more types of games • Encourage lapsed players to start playing again • Influence public opinion about lotteries in general