A Lottery Industry Roundtable in Canadian Gaming Business featured top executives from five Provincial Lottery Corporations. Here are the first two of five main topics and some of the key takeaways from each.
1) What are the biggest challenges you face and your positioning to deal with them?
Brent Scrimshaw, President and CEO of The Atlantic Lottery stated it is an eroding player base due in part to the industry having “not done a good job at appealing to younger adults with our offering.” Pointing out the fact that 18-35-year-olds are active gamers, they are working hard to upgrade their product roster and expand their digital delivery of it to them.
Seeing evolving customer interests and advancing technology, Ontario Lottery Senior Vice President Greg McKenzie sees the current terminal technology limiting where and how lottery tickets can be sold. They are modernizing operations to meet their growth objectives by “continuing to innovate and focus on traditional lottery retailers, as well as expanding new lottery sales options.” This will include selling tickets over the Internet.
Kevin Gass, Vice President of The British Columbia Lottery, says that clearly technology and mobile devices are changing entertainment preferences and expectations. He summed it up saying, “Our players want to play what they want, how they want, where they want and when they want.” Millennials are already a big time “gamer” segment, and this requires lotteries to align their products to meet their preferences.
Studies show that compared to 70% of young adults 25 years ago followed their parents and started playing the Lottery, only around 40% do today. Robert Ayotte, President of Loto-Quebec Lottery Operations, does not mince words saying “To diversify our game offer and transform our distribution network become absolute priorities.”
2) Where do you see the greatest growth opportunities for lottery organizations?
“Expanding channels to make lottery play more convenient for players.” Is clear to Michael Lackmanec, Vice President at Western Canada Lottery. These include options like self-service and digital channels. He added that products that can capitalize on these new distribution channels must be developed.
In British Columbia Kevin Gass sees growth coming from the introduction of new products and enhancements to existing ones. He observes that driving the long-term growth they need comes from effective customer engagement and that in turn must pay close attention to changing demographics, new trends and new technology to succeed.
Atlantic Lottery’s President Scrimshaw sees the 30% of adults who currently do not play the lottery as “Opportunity No. 1”. Part of that may be the games offered as he also related that tens of millions of dollars leave for illegal off-shore sites and that a safe, fully regulated Canadian alternative could certainly help drive growth. Given the option, Atlantic Canadians overwhelmingly favor their own Provincial offerings.
In Ontario, Greg McKenzie sees that their continued year-over-year growth will be aided by selling lottery tickets over the Internet because that will make their “Big Lotto easier to buy for new players” adding to the lion’s share traditional retailers sell. But he also sees the opportunity that exists by offering a broadened portfolio of products that their infrequent players might get excited about and play more frequently.
It is obvious these executives are not just watching and waiting. Rather they are planning, studying and working to meet the inevitable challenges head on to drive growth to meet the very important objectives of their organizations and fund their good works!