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No. 35 | Winter 2011 / 2012

Celebrating the best in Good Causes The UK National Lottery holds the UK National Lottery Awards annually to find the United Kingdom’s favorite lottery-funded projects, and to raise public awareness of lottery funding for Good Causes. The winners of this year’s event were announced at a gala ceremony broadcast live on Saturday, November 5, 2011. In this issue, we take a closer look at the Awards, the winners, and the beneficiaries.

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Contents 5

Do something good

Letter from the President

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Thinking on our industry I am often reminded of the David Nicholls book One Day, the subject of a recent Hollywood movie by the same name. For those of you not familiar with the book or the film, I will offer you a brief explanation.

Association Business The latest news from the WLA and its members with additional reports from the regional associations.

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Responsible Gaming

Deusto University of Spain wins the inaugural ONCE international contest on responsible gaming research.

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Security

How the risks of retailer fraud can be dealt with proactively and cost effectively through player protection controls and retailer compliance monitoring. A report from Thomas Bierbach, vice president of Baseline Geographics Inc.

14 The UK National Lottery Awards For the eighth consecutive year, the UK National Lottery showcased, in a nationally-televised event, the good causes supported by lottery funding.

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Sports betting, Korean style

How SPORTSTOTO, in conjunction with the Korean Sports Promotion Foundation, makes an enormous contribution to the well-being of the people of Korea.

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The growing popularity of block games

Block games around the globe are increasing both in size and number. We take a close look at some recent developments in block games in Europe and America.

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Product innovations of 2011

Both to maintain customer loyalty and to attract new players, WLA member lotteries continue to stress novelty and diversification in the development of new products. Here, we showcase a selection of some of the best product innovations of 2011.

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Betting on the opera

Continuing our series on gambling in the arts, gaming expert Göran Wessberg presents a study on operas and musicals that have gambling as a leitmotif.

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Corporate News News from members of the WLA Contributors Program and other WLA Associate Members.

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The Learning Curve

One Day is a bittersweet love story that spans 20 years. The main characters, Emma and Dexter, meet for the first time on the night of their graduation from university, July 15, 1988, and then go their separate ways. For the next 20 years, key moments of their relationship are experienced each July 15. Emma is a working-class girl of principle and ambition who dreams of making the world a better place. Dexter is a wealthy charmer who becomes a successful television professional. His mother, resigning herself to his flamboyant lifestyle, advises her son to “do something good” for the world. Our industry, not unlike the individual paths chosen by Emma and Dexter, is driven both by entertainment and the desire to make the world a better place by contributing to good causes. It is important that we get that message across to our stakeholders and that it is recognized as our most outstanding characteristic. In this issue of the WLA magazine we cover two fine examples of how WLA member lotteries communicate this important message to their stakeholders. Each year the UK National Lottery holds a nationally televised awards ceremony. This event celebrates the UK National Lottery beneficiaries that serve good causes by putting lottery funding to use in innovative ways. Second, we have a report on SPORTSTOTO of Korea and their important contribution to sports. A large proportion of their annual total sales goes to support everything from grass roots sports to major national and international sporting events in the Republic of Korea. The WLA is proud to represent more than 140 lottery organizations that, just like the UK National Lottery and Sportstoto of Korea, work hard each year to make the world a better place. We will be showcasing other such WLA member organizations throughout the year in the WLA magazine, at various seminars, as well as at the World Lottery Summit 2012 (WLS 2012) that will be held from September 9–12 in Montreal, Canada, in cooperation with NASPL. Preparations for the WLS 2012 are moving full speed ahead and are on target, as we have the good fortune of having Loto-Québec assisting us with the organization in Montreal. With a host of interesting speakers lined up, a worldclass venue, in one of the most alluring cities in North America, this promises to be an amazing event. Stay tuned to the official WLS 2012 website for the latest developments (wls2012.com). Wishing you a great start in the new year!

Reports from recent WLA seminars from around the world and the tentative schedule of events for 2012.

Jean Jorgensen, Executive Director, WLA WLA magazine | No. 35 | Winter 2011 / 2012

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World Lottery Summit September 9 - 12, 2012

Preparations are now in full swing for this major event. /ŶĂĮƌƐƚĨŽƌƚŚĞůŽƩĞƌǇŝŶĚƵƐƚƌǇ͕ƚŚĞt>ĂŶĚE^W>ǁŝůůũŽŝŶĨŽƌĐĞƐĨŽƌƚŚĞtŽƌůĚ>ŽƩĞƌǇ^ƵŵŵŝƚϮϬϭϮŝŶDŽŶƚƌĠĂů͕ ĂŶĂĚĂ͘dŚƌŽƵŐŚƚŚŝƐĐŽůůĂďŽƌĂƟŽŶ͕ǁĞĂŝŵƚŽĚĞůŝǀĞƌĂůŽƩĞƌǇĞǀĞŶƚŽĨƵŶƉĂƌĂůůĞůĞĚĚĞƉƚŚĂŶĚƋƵĂůŝƚǇƚŽƚŚĞŵĞŵďĞƌƐ ĂŶĚĐŽŶƚƌŝďƵƚŽƌƐŽĨďŽƚŚĂƐƐŽĐŝĂƟŽŶƐ͘ dŚĞt>ĂŶĚE^W>͕ĂƐǁĞůůĂƐ>ŽƚŽͲYƵĠďĞĐ͕ŽƵƌŚŽƐƚĨŽƌƚŚŝƐĞǀĞŶƚ͕ůŽŽŬĨŽƌǁĂƌĚƚŽŐƌĞĞƟŶŐ ǇŽƵŝŶMontréal, Canada, September 9 – 12, 2012 ĨŽƌƚŚĞtŽƌůĚ>ŽƩĞƌǇ^Ƶŵŵŝƚ͘

www.wls2012.com

World Lottery Association Headquarters Lange Gasse 20 P.O. Box CH-4002 Basel, Switzerland Phone: +41 61 284 1502 Fax: +41 61 284 1350 www.world-lotteries.org

World Lottery Association 0RQWUpDO2I¿FH 500 Sherbrooke Street West Suite 2000 Montréal, Québec H3A 3G6, Canada Phone: +1 514 282 0273 Fax: +1 514 873 8999

North American Association of State and Provincial Lotteries (NASPL) One South Broadway Geneva, Ohio 44041, USA Phone: +1 440 466 5630 Fax: +1 440 466 5649 www.naspl.org

LETTER FROM L E T T ETHE R F R O M TPRESIDENT HE PRESIDENT

United we stand! The end of one year and the beginning of the next always represents an enchanting watershed moment for me. It is a time when one can simultaneously look back on the past year in joyful reminiscence and look forward to the new year with ambition and positive anticipation. Looking back at 2011 what I find most remarkable are the many opportunities that I was given to meet with my friends and colleagues around the globe. Such moments are most valuable in strengthening existing bonds and forming new partnerships, partnerships that are important in our continuous effort to support good causes in the societies within which each of our member lotteries work. I was graciously welcomed this year in Penang, Malaysia, for the APLA Regional Conference; in Rio de Janeiro, Brazil, for the CIBELAE Convention; and in Indianapolis, Indiana, USA, for NASPL 2011. As CEO of Veikkaus, I also played host to the EL 2011 Congress, in Helsinki, Finland. These independent regional associations are major pillars upholding the world lottery community and the WLA highly values its cooperation with each of them. Starting off this year’s round of conventions, was “Northern Light”, EL 2011 in my hometown of Helsinki, Finland. Over 600 delegates from Europe and other parts of the world came together to make the convention an absolute success. Many thanks once again to the EL staff and to my team at Veikkaus for their hard work and the splendid organization of this event. The 13th CIBELAE Congress in sunny Rio de Janeiro followed, from October 3–6. Caixa Econômica Federal of Brazil did a wonderful job of organizing and hosting what is considered the landmark event for Latin America. The theme “Building the Future” was promulgated through the entire convention. While at the CIBELAE Convention in Rio it became clear to me that, no matter where I am, our mission and our vision remains the same. Industry wide, WLA magazine | No. 35 | Winter 2012 / 2011

in all parts of the world, we are moving in the same direction, building the future of our industry by taking advantage of new technology and trends, protecting our players, and turning a profit for good causes. At the convention, Mr. Fabio Cleto, VicePresident of Government and Lottery Funds at Caixa Econômica Federal, was elected president by the members of CIBELAE. I wish to congratulate Mr. Cleto and look forward to working with him in the future. Just one week later, from October 10–13, I was in Penang, Malaysia, for the APLA Regional Conference. Themes relevant to our industry were covered, such as the use of social media, and responsible gaming. It was also encouraging to learn how many lotteries around the world are doing their part to protect the environment. Mr. Lawrence Lim Swee Lin, CEO of the Magnum Corporation, Malaysia, and his staff did a fantastic job in organizing and hosting the convention, and I wish to thank and congratulate them on the success of this event. Many thanks are also due to APLA Chairman June Roache and her team for their part in making this one of the memorable events of 2011. From October 25–28 we were back in the western hemisphere for NASPL 2011. We were asked to “Expect the Unexpected”, but as expected the NASPL team and the Hoosier Lottery of Indiana put together a top-notch event. Themes on retailer excellence and leveraging new technology, combined with a host of renowned keynote speakers, provided for a well-rounded business program. I had the pleasure of meeting and conferring with NASPL president-elect Mr. Gordon Medenica, Director of the New York Lottery. I am looking forward to working with Mr. Medenica in 2012. All these events illustrate the spirit of cooperation that permeates the WLA. Together with the regional associations we will maintain our focus on our vision and mission to raise money for good causes in a socially responsible way. In 2011 we extended our

social responsibility mission by reaching out to other organizations in an effort to fight the scourge of match fixing. This problem not only destroys the integrity of sports, but also attacks both the heart of our key business sector of sports betting and the reputation of the entire gaming industry. There are also more than just business issues at stake here. Funds raised by WLA members internationally, for grass-roots sports, youth athletic programs, and the promotion of healthy competition, are being threatened by organized criminal groups. For this reason the WLA will continue its close cooperation with the International Olympic Committee (IOC). We are also committed to maintaining our alliance with SportAccord and AIPS (the International Association of the Sport Press). SportAccord represents all international sports federations and organizations – both Olympic and non-Olympic, while AIPS maintains the leading global network of sports journalists. Through our unity with these organizations we will strengthen our resolve to counter match fixing, maintain the integrity of sports, and protect our beneficiaries around the globe. With our sights on Montreal we are now looking forward to the World Lottery Summit 2012. The WLA staff in accord with NASPL are now busy putting together what promises to be a world-class event. Throughout the year many gaming events are organized by the private gambling industry. I take great pride in the fact that only the WLA and the regional associations organize events that support our true mission of raising funds for good causes. I encourage you to get out your agendas, reserve the dates September 9–12, 2012, and make plans now to join us in Montreal for the World Lottery Summit 2012. Sincerely

Risto Nieminen WLA President 5

ASSOCIATION A S S O C I AT I O N B U SBUSINESS INESS Gaming Laboratories International creates dedicated global lottery consulting group Gaming Laboratories International (GLI), LLC, the world’s leading gaming testing laboratory and technical consultancy, announced today that it has formed a new dedicated global lottery consulting group. The new group will consult with lottery organizations globally on issues relating to the audit and security of all of their lottery products, including VLTs, their on-line games, iGaming, scratch tickets and conformance with International Organization for Standardization (ISO) and World Lottery Association (WLA) standards. The new group will be based in Moncton, New Brunswick, Canada, and will be headed by GLI Canada’s new Director of Lottery Services, Gregory Doucette, and Mr. Doucette’s long-time business partner, Daniel Charlong. Formerly of Tyrne Enterprises, Inc. and the Atlantic Lottery Corporation (ALC), Mr. Doucette is a WLA Security Control Standard (WLA SCS) and ISO 27001 certified auditor. His auditing skills and experience are enhanced by his previous career

experience as a director of security and compliance, and manager of internal audit, for the ALC. Over the past 20 years, he has developed a broad range of experience in public and private industry. He recently successfully collaborated with GLI on a security audit completed for a major US lottery. Trained and certified in project management, and a trained and certified ISO 27001 trainer, auditor, and implementer, Mr. Charlong has more than 25 years of experience in Gregory Doucette both the private and public sector. His various roles include public policy analysis, organizational change management and compliance, audit, financial management and analysis, compliance and standards regulations, and business operations and management. Currently, Mr. Charlong specializes in developing custom training

programs for organizations pursuing ISO certification and in facilitating publically offered courses. For more than 20 years, GLI has been the world leader in providing independent testing, inspection and certification services to the gaming, wagering and lottery industry. Today the company tests for more than 65 lotteries around the world, most of them exclusively, which is more than any other testing organization globally. GLI is an associate member of the European Lottery Association (EL), the North American State and Provincial Lotteries (NASPL), and the World Lottery Association (WLA). The new GLI group will be dedicated to expanding the company’s association with lottery organizations globally. Mr. Doucette and Mr. Charlong will coordinate GLI’s lottery consultation services globally, working with specialized GLI lottery team members throughout GLI’s global network of 19 facilities. Together the team will provide lottery regulators and operators full-service lottery support in the expanding lottery market.

Fabio Cleto appointed President of CIBELAE Fabio Ferreira Cleto, currently Vice President of government funds and lotteries at Caixa Econômica Federal, Brazil, (CAIXA), was elected President of Corporación Iberoamericana de Loterías y Apuestas del Estado (CIBELAE) at the XIII Congresso CIBELAE held in Rio de Janeiro, October 2–7, 2011. He replaced Roberto Armando López of Lotería Nacional Sociedad del Estado, Argentina, as CIBELAE President. Mr. Cleto, 39, earned his degree in business administration from Fundacao Getulio Vargas and his master’s degree in mathematical modeling from FEA/EMI, Universidade de São Paulo. He began his career as an equity analyst at several banks, including Banco ABC Roma, Nacional Multiplic, and Dresdner Bank. From 2002 to 2009, he was head trader of national currency at 6

Banco Itaú’s proprietary desk, where his responsibilities included management of the derivatives portfolio, the private securities portfolio, the securitized papers portfolio, together with management of government securities. Prior to joining the senior executive at CAIXA, he was the foreign investors fund’s CEO at Aquitaine Investments LLC. As CEO he had overall responsibility for fund management, currency arbitrage, variable income portfolio management, and fixed income portfolio management (Brazil). On his election to the presidency of CIBELAE, Mr. Cleto issued a statement outlining his future objectives for the organization. After thanking his predecessor and the members of CIBELAE, Mr. Cleto said in part that, as President of CIBELAE, he will work to ensure CIBELAE effectively repre-

sents the interests of state lotteries both in Ibero-America and around the world. He further said that, as President of CIBELAE, his period of governance will be founded upon three pillars, namely: (a) the implementation of a strategic plan for the period 2012–2013 that accommodates recent developments in global lottery markets; (b) a review of the statutes and rules governing CIBELAE, to account for issues that will enhance the association’s performance; and (c) a review and revamp of the CIBELAE website to harness the full potential of the Fabio Ferreira Cleto Internet. WLA magazine | No. 35 | Winter 2011 / 2012

ASSOCIATION A S S O C I AT I O N B U SBUSINESS INESS Gordon Medenica appointed President of NASPL The director of the New York Lottery, Gordon Medenica, was elected President of the North American State and Provincial Lottery Association (NASPL) for a one-year term at the 2011 NASPL Convention and Trade Show held in Indianapolis, Indiana, October 24–28, 2011. He replaced the director of the Idaho Lottery, Jeff Anderson, as NASPL President.

Gordon Medenica

The New York Lottery is the largest

and most profitable state lottery in the US. As director of the New York Lottery, Gordon Medenica serves as the chief executive officer of an organization with revenues of US$7.9 billion. Under his leadership, the New York Lottery has set new revenue records every year since his appointment in 2007. In particular, the lottery has generated a record US$3 billion over the past year for its mission of funding education in New York State. Gordon Medenica earned his A.B. from Harvard College, where he majored in government, and his M.B.A. from Harvard Business School. Prior to coming to the

New York Lottery, Mr. Medenica was executive vice President of Philadelphia Media Holdings, LLC, an owner of the Philadelphia Inquirer and Daily News newspapers. Before this, he was a longtime executive at The New York Times Company, serving as a member of its management committee, as head of strategic planning, corporate communications, and as group publisher of several of the company’s sports magazines. Mr. Medenica has also acted as an independent advisor to the Blackstone Group on newspaper acquisitions; as President and CEO of sports marketing company Dorna USA, LLC; and as a senior analyst at the Marriott Corporation.

Santa Casa appoints new board members On September 15, 2011 the Portuguese Government appointed new members to the board of Santa Casa da Misericórdia de Lisboa, Portugal. Santa Casa is the company that runs the state lottery games in Portugal, in addition to numerous other business areas providing for good causes.

Secretary of State for Culture; Assistant State Secretary to the Prime Minister; and Deputy to both the Portuguese National Assembly and the European Parliament. In addition, he has been President of Sporting Clube de Portugal, one of the best-known Portuguese football clubs.

The President of Santa Casa is now Mr. Pedro Santana Lopes. A respected lawyer, Mr. Santana Lopes has extensive experience in National and Local Government service. Of his many positions his term as Prime Minister of Portugal between 2004 and 2005 is most pertinent. During his vast career in public service, he has also been: Mayor of Lisbon; Mayor of Figueira da Foz;

The Vice President of Santa Casa is now Mr. Fernando Paes Afonso. He will be in charge of the gaming business area, commercially designated as Jogos Santa Casa. An economist, Mr. Paes Afonso has past experience of the lottery business as a board member of Santa Casa and President of Jogos Santa Casa between 2002 and 2005. He has also worked previously in the busi-

ness areas of financial services and public construction. Prior to taking up his appointment at Santa Casa, he was General Manager of AECOPS, the Portuguese Association of Public Construction Companies.

Pedro Santana Lopes

Fernando Paes Afonso

Loto-Québec appoints new President and CEO On November 7, 2011, Mr. Gérard Bibeau succeeded Mr. Alain Cousineau as President and Chief Executive Officer of Loto-Québec. A career civil servant, Mr. Bibeau, 51, hails from the Sorel region of southwestern Québec. After graduating with a Bachelor of Administration from Université Laval in 1983, he served as Chief of Staff at the Office of Québec’s Ministre du Revenu (ministry of revenue) from 1988–1991. In 1990 he obtained a Bachelor of Law, also from Université Laval, and was admitted as a member of the Québec Bar Association in 1992. From 1992–2006 he served in various senior posts in the Québec civil service, including a WLA magazine | No. 35 | Winter 2011 / 2012

decade (1993–2003) spent as Vice President, Operations of the Office of the Prime Minister of Québec, and two years (2004– 2006) as member, CEO, and Chairman of the Board of Directors of the 4,000-employee Commission de la santé et de la sécurité du travail (Québec’s workmen’s compensation commission). From 2006 to 2011, he was Gérard Bibeau Secretary General

and Clerk of the Executive Council of the Ministère du Conseil exécutif (Québec’s executive council office), which is the highest position in the Québec civil service. Paying tribute to Mr. Bibeau’s five years of service in the position of chief administrative officer, Quebec Premier Jean Charest said, “Mr. Bibeau has played a key role in the development of multiple steps that have allowed Quebec to survive the economic crisis better than its neighbors.” In particular recognition of his wealth of administrative experience and sound financial management, Mr. Bibeau’s appointment has been warmly welcomed by Loto-Québec. 7

ASSOCIATION A S S O C I AT I O N B U SBUSINESS INESS The Asia Pacific Lottery Association (APLA) 2011 Regional Conference The picturesque Shangri La Resort in Penang, Malaysia was the setting for the 2011 APLA Regional Conference. From October 10–13 the Magnum Corporation of Malaysia graciously hosted this event, which drew more than 120 international delegates. Themes central to this year’s conference covered the integration of social media, responsible gaming, and the promotion of green initiatives. APLA is known for their innovative conference concepts and this regional conference was no exception. Daily debates on key lottery themes such as, ‘Lotteries can afford to ignore social media’ and ‘Customers care about lottery organizations giving to good causes’, provided for entertaining and thought provoking discussion. This year, different lotteries presented their best practice case studies, which provided insights into the diversity and innovation that exists across the Asia Pacific region and beyond. Keynote speaker Mr. Kevin Flood, CEO of Gameinlane, Inc., presented a compelling insight into the evolution of the social web and online gaming and the opportunities for the lottery industry. Mr. Flood spoke about the past, present, and future of social media and gaming. He challenged the conference dele-

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gates by asserting that their competitors across the gambling sector are engaging in this space. In online gaming the line of distinction no longer resides with industries, but rather with the experience of the player. Kevin’s summary of the conference can be found on his blog at kevinflood.blogspot.com. Social media was again in the spotlight as Mr. Oon Yeoh, Malaysian writer, editor, and new media consultant, presented an insightful session entitled ‘The Good, The Bad, and The Ugly of Social Media’. Mr. Yeoh examined a number of major brands that experienced the ‘downside’ of social media. Ultimately, however, he did not discourage the use of social media. Rather, he called for the carefully considered and thoughtfully planned use of social media and the willingness to engage your customers in a new way.

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Other sessions, rounding out the first day of the conference, explored retail and franchisee management; challenged lotteries to stay competitive in a monopolistic environment; and shared further insights into the implementation of social media plans. Ms. Rikke Netterstrom, Executive Director of CSR Asia, opened the second day of the conference with a perceptive presentation on leadership in Corporate Social Responsibility (CSR), stakeholder engagement, and communication. Ms. Netterstrom prepared an interesting scanning exercise of lotteries in the Asia Pacific region that demonstrated, in their online environment, a strong commitment to CSR. In particular, she focused on responsible gaming, reinforcing the WLA’s Responsible Gaming Framework as part of an organizational approach to CSR.

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1 Delegates came in their sarongs and pareos. 2 The welcome dinner at the Cheong Fatt Tze Mansion, a UNESCO Heritage Site. 3 Lawrence Lim Swee Lin, CEO of Magnum Corporation, Malaysia welcomes the seminar participants. 4 Dr. Jasmine Loo, speaks on gambling addiction.

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WLA magazine | No. 35 | Winter 2011 / 2012

ASSOCIATION A S S O C I AT I O N B U SBUSINESS INESS Green initiatives, and what lotteries are doing for the environment, were discussed by a panel of representatives from South Australian Lotteries, the Hong Kong Jockey Club, and – with regards to their Takarakuji Lottery 1 – the Japan Lottery Association. It was encouraging to learn how seriously these lotteries take their responsibilities toward the environment.The panel presented some remarkable environmental initiatives, including the use of vegetable inks in ticket printing, the move toward paperless transactions, the conscientious use of energy, and the principled use of transportation. Industry suppliers took center stage in the afternoon of the second day, sharing their new innovations and product offerings in the social media space. GTECH, INTRALOT, Pollard Banknote, and Scientific Games all provided valued sponsorship for the APLA Regional Conference. The final day of the conference welcomed Mr. Tim Healy, faculty member from the US-based Institute for Operational Excel-

lence. The Institute for Operational Excellence is a think-tank for organizations seeking to maintain a path of continuous improvement and sustainable business growth. Mr. Healey ran the morning session as a workshop, examining efficiencies in supply chain management and operations liaison. He challenged the delegates to analyze and streamline their own business processes in order to achieve improved results. The morning session was followed by a panel discussion, which included representatives of the European State Lottery and Toto Association (EL) and Singapore Pools. Mr. Joni Hovi, Vice President, International Business, Veikkaus Solutions Oy, presented the EL’s “Young Lions”, a program that aims to promote aspiring young professionals in the lottery industry. Ms. Marilyn Ling, Chief Marketing Officer of Singapore Pools, presented their new initiative, I-CUBE (I3) – Ideas, Innovation, and Improvement. The panel discussion provided food for thought on how to tackle the future challenges facing the lottery industry.

The island paradise of Penang provided a wonderful backdrop for a range of much enjoyed social programs. The opening night dinner was a highlight of the conference, with a police escort to The Unesco World Heritagelisted Cheong Fatt Tze Mansion in central Georgetown, Penang. The tour featured cultural performances, crafts people, and a historical introduction to the mansion and its impressive history. Local musicians entertained guests who enjoyed a culinary feast. The location of the Shangri La Resort on one of Penang’s most pristine beaches provided a fantastic location for the closing night sarong party. Each delegate dressed in traditional costume and enjoyed hawker hut food stations and some very daring party games! Karaoke and dancing ensued until the early hours, with a wonderful evening being had by all. A final vote of thanks goes to Magnum Corporation for a memorable experience and an extremely well organized regional conference. Many thanks are also extended to Singapore Pools for the support they provided in the development of the business program.

1 For a full report on the Japan Lottery Association and the Takara-kuji lottery please refer to “Jumbo Takara-kuji Lotteries: Evolution of lotteries in Japan”, WLA magazine number 30, summer 2009.

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5 Henry Chan, Executive Director, HKJC Lotteries Limited and Lawrence Lim, CEO Magnum Corporation. 6 WLA President Risto Nieminen and Advantgames CEO Riko Soininen. 7 Part of the APLA Executive Committee attend the Closing Dinner in their sarongs.


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INSIGHT I N S I G HINSIGHT T Deusto University team wins first ONCE international contest on responsible gaming research Recently, the Organización Nacional de Ciegos Españoles (ONCE) held the inaugural ONCE International Contest on Responsible Gaming Research. The competition winners, a team of scientists from Deusto University, Spain, will conduct a two year research project on factors that stimulate the risk of problem gambling in adolescents. The ONCE International Contest on Responsible Gaming Research promotes and supports research into the identification of problem gambling risk factors inherent in gaming products, and to minimize unwanted gaming effects in other areas. The competition, which is held biennially, carries a single prize of 30,000 euro. Submission of entries for the inaugural competition opened March 14, 2011, and closed June 30, 2011. The submitted projects were assessed by a tribunal of outstanding experts and distinguished professionals chaired by ONCE Gaming Deputy Director General, Luis Natalio Royo Paz. The other members of the jury were Etelvina Andréu Sánchez, general director of consumer affairs in the Spanish Ministry of Health, Social Policy

and Equality; Arturo Canalda, the ombudsman for children of the Community of Madrid; Francisco J. Labrador, professor of behavior modification in the School of Psychology, University Complutense of Madrid; Elisardo Becoña, professor of clinical psychology in the School of Psychology, University of Santiago de Compostela; and Enrique Echeburúa, professor of clinical psychology of the School of Psychology, University of País Vasco. Antonio Mayor Villa, director of ONCE’s Communication and Image Department, acted as secretary to the jury. Works submitted to the competition were judged on their quality, the technical and economic feasibility of each project, and the merits of the individual researchers or

groups of researchers involved. The winning entry impressed the jury with its strong scientific basis, its broad overall perspective, and the extensive bibliography underpinning the intended project. The jury also stressed the rigorous methodology by which the winning team proposed to accomplish the project work.

The winning entry The winning project, submitted by Dr. Ana Estévez, Sra. Iszaskun Sarabia, and Sr. David Herrero, all of Deusto University, Spain, is entitled “Factors that stimulate gambling risk factors in teens and youth.” As the project title suggests, the aim of the study is to identify risk factors that lead adolescents and young people into problem gambling. Here, problem gambling is understood as

About the winning research team The winning research team comprises Dr. Ana Estévez, Sra. Izaskun Sarabia, and Sr. David Herrero, all of the Faculty of Psychology and Education at the University of Deusto. Dr. Ana Estevez is Associate Professor in the Faculty of Psychology and Education. The author of three scholarly monographs, five book chapters, and twenty-one scientific papers in internationally peer-reviewed journals, Dr. Estévez is an expert on gambling, violence, and emotional disorders. Her previous externally funded research proj-

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ects on the psychology of young adults include a three-year study into the development of depression in adolescents, funded by the Spanish Ministry of Science and Technology, and a three-year study of violent behavior in adolescents, funded by the Basque Government Department of Drug Addiction. Izaskun Sarabia is a Ph.D. student working under the direction of Dr. Estévez on a thesis on gambling among youth and adolescents. Holding an M.Sc. focusing on drug dependencies, she is a researcher at the

Deusto Institute of Drug Dependencies and is the author of nine peer-reviewed scientific papers in national and international journals. David Herrero is finalizing his Ph.D. on human factors in the commission of traffic accidents and violations under the direction of Dr. José Cáceres, Professor of Psychophysiology in the Department of Psychology at Deusto University. The author of seven peer-reviewed scientific papers, he is also a commentator on road safety issues and related subjects for the Spanish press.


INSIGHT I N S I G HINSIGHT T persistent, recurring, and uncontrolled gambling having severe repercussions on personal, family, and professional life. Existing research shows that in recent years, there has been a surprising decrease in the age of people addicted to gambling. In particular, data from Spain indicates that the prevalence of problem gambling among adolescents and young adults is over 2%. This is troubling for many reasons. For example, t 1SPCMFNHBNCMJOHBNPOHBEPMFTDFOUTIBT been associated with a wide range of mental problems, including high levels of depression, greater risk of alcohol and substance abuse, risk of suicidal thoughts and behavior, high anxiety levels, and poor overall health. t :PVOHBEVMUTBEEJDUFEUPHBNCMJOHSVOB greater risk of committing crimes and suffer from more family problems and poorer scholastic performance than adolescents who are not addicted to gambling. t "EPMFTDFODF JT B QFSJPE PG EFWFMPQNFOU during which people may be especially vulnerable, and so the effects of problem gambling on adolescents may be correspondingly more severe than for adults. t #FDBVTFBEVMUQSPCMFNHBNCMFSTUZQJDBMMZ begin gambling during their adolescence and youth, adolescent problem gambling sets the stage for lifelong pathological behavior.

Although the consequences of problem gambling early in life are potentially devastating, there are few extant studies on problem gambling in young adults. The handful of studies that do exist show that the origins of problem gambling in the young are complicated, and further, that early contact with gambling is only one of many complex and interrelated factors that determine whether an adolescent develops a gambling problem. Other relevant factors include low selfesteem, symptoms of depression, high levels of dissociation, lack of social support, and having little connection with family. Further relevant factors are delinquency, dysfunctional family relationships, low scholastic performance, and beginning to gamble from an early age (from the age of ten onwards). It transpires in particular that there are hardly any studies that examine other factors inherent in gambling or the relationship between the type of adolescent and the likelihood of becoming addicted to gambling. The winning project aims to fill this gap in the relevant scientific literature. In a novel approach to the study of problem gambling in adolescents, the winning research team will conduct a psychophysiological study of the effect of gambling on young people and adolescents. Qualitative methods in the form of discourse analysis – a research technique that seeks to provide an awareness of the hidden motivations in people and in this way to enable the solution of concrete problems – will be used to investigate the

“how” and “why” of the target group’s decision making processes. This aspect of the study will enable the research team to learn more about the addictive effects that certain games have on the target group. Having analyzed the psychophysiological responses of adolescents and young adults to gambling, the study will be completed by an analysis of the target group to determine the intrinsic variables that cause adolescents and young adults to be more likely to play certain games. This aspect of the study will focus on some of the primary animating factors, owing to the presence of many existing variables.

Research Outcomes The completed study may result in the identification of risk factors inherent in games that may lead to their addictive consumption by adolescents, and a greater knowledge of the pyschophysiological factors inherent in problem gaming in young adults. In addition, the completed study could help clarify young people’s perception of gambling, and assist in determining some of the personal variables that lead adolescents into problem gaming. In terms of practical outcomes, the results of the study, which are to be published in a series of scientific papers, may contribute to making prevention of problem gambling among adolescents more effective. The WLA may report on the outcome of the study in due course.

About the University of Deusto The University of Deusto is a Jesuit University located in the Basque Country, Spain. Established in 1886 by the local Basque community and the Society of Jesus, the university offers degrees in Law, Theology, Engineering, Economics and Business Administration, Psychology


and Education Sciences, and Social and Human Sciences. Numerous advanced degrees, such as Masters and Ph.D. programs, are also available. Currently, the university has over 10,000 students spread across two campuses in Bilbao and San Sebastián.

The university is internationally recognized for the quality of its programs in law and business. In particular, its school of business is the oldest and one of the most prestigious in Spain. Emilio Botín, Executive Chairman of Spain’s Grupo Santander, one of the largest banks in the world by market capitalization, is a graduate of the law and business schools of the university. Other notable alumni include José Antonio Aguirre y Lecube (1904– 1960), the first president of the Basque Autonomous Community, and the novelist Espido Freire, winner of the Premio Planeta de Novela 1999 (the second-most valuable literary award in the world after the Nobel Prize for literature).

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SETTING S E T T I NSTANDARDS G S TA N DA R D S Of Icebergs and Lotteries: Retailer fraud, the invisible threat The threat of retailer fraud is not to be underestimated. It can severely disrupt your lottery operation and damage its reputation for a considerable time. Thomas Bierbach, Vice President of Baseline Business Geographics Inc., explains how retailer-fraud risks can be dealt with proactively and cost effectively through player protection controls and retailer compliance monitoring. Baseline’s end-to-end compliance management solution, Baseline Compliance Manager, facilitates retailer compliance monitoring and integrity testing programs, thereby ensuring a lottery operation’s reputation. Were icebergs bad for the Titanic? We all know the answer to this rhetorical question. But really, what are the odds of hitting an iceberg? They are very small, are they not? You may be wondering where I am going with this, but please indulge me — it is a simple example of a risk management exercise. Say you are sailing along in your ship, the HMS Lottery, and you think you have everything well under control. Sales are good, new products abound, technology works, players and shareholders are happy, you are staying out of the news, and then — the unthinkable happens. You run into an iceberg and it rattles your vessel from bow to stern.

Retailer fraud Retailer fraud is a crime of opportunity. The temptation for a lottery retailer or staff member to defraud unsuspecting players of their winnings has been around for as long as the retail channel has been part of the lottery business model. The risk of tickets getting swapped, palmed, or switched varies, depending on the lottery terminal equipment and validation procedures in use — but it is there nonetheless.

We have learned from such occurrences that the likelihood and impact of retailer fraud can easily be underestimated. Lotteries are often not fully aware of the real threats and the associated risks posed by retailer fraud until a major incident occurs. In the event of a retailer fraud incident, it becomes less a matter of the monetary impact on the lottery than a matter of the reputational damage to the lottery and its retailer base, and the ensuing adverse consequences thereof.

Your passengers, the public, stakeholders and media alike, start to question your seaworthiness. Your organization is taking a tremendous blow to its reputation. Everybody wonders, how could this happen? If you are lucky enough to keep the ship afloat — as well as your career — and continue the cruise, you will be asked what you are going to do to prevent this from happening again. Do you have all the answers? Not many have. This parable serves well to illustrate a particular risk that virtually all lotteries face, a risk that is profoundly underestimated both in its likelihood of occurrence and in its detrimental impact. That risk is retailer fraud. Of course instead of seaworthiness, it is primarily the reputation and the integrity of the lottery operation that are at stake. 12

damaged and their integrity challenged. Player confidence was shaken, jobs were lost, and millions were spent in correcting operational shortcomings. The haste with which the issue at hand was addressed and the after-the-fact overreaction to risks that could have been proactively mitigated in the first place, further aggravated the situation. But, like the awareness of a leaky roof and the urge to fix it, both are diminished while the sun is shining.

Thomas Bierbach, Vice President, Business Development, Baseline Business Geographics Inc.

Just a few years ago, a number of lotteries in Canada experienced the unwanted attention an incident of fraud can draw. Lotteries across the country had their reputations

Past incidents have proven that recovery from reputational damage and the resulting decline in player and stakeholder trust is not only costly, but takes significant time. Licensed operators of a state lottery have even more at stake than other governmentrun lotteries, as license renewal is crucial to their continued success in executing growth strategies in other markets. Lotteries are not just lotteries anymore. Changes in the industry have driven many organizations to expand their horizons and growth strategies beyond their core business areas and to venture outside their jurisdictions. Striving WLA magazine | No. 35 | Winter 2011 / 2012

SETTING S E T T I NSTANDARDS G S TA N DA R D S to be a world-class contender and maintaining a competitive edge are essential in this changing environment. Shortcomings in operational excellence will be harmful to those competing in bids for licenses and contracts. In seeking to understand and manage retailer security risks, lotteries can profit from the experiences of lotteries from other jurisdictions. Such practical knowledge can help a lottery organization address retailer fraud risks proactively and cost effectively, which is preferable to an after-the-fact reaction to a retailer fraud incident. Lottery regulators, stakeholders, and the public are looking for demonstrated integrity, compliance, and player protection from fraud in lottery retail operations. Lottery shareholders and business management are looking for a return on the security investment and operational efficiency. The lottery security and compliance function has to ensure security, integrity, and regulatory compliance in balance and alignment with business objectives. Although many lotteries are implementing retail compliance testing and mystery shopper programs, the ability for them to compile data on the efficacy of such programs remains a challenge. A specific issue in the area of retailer security and player protection is the significant lack of control players have when validating their tickets. Players must often rely on the integrity of the retailer for accurate validation results. Without proactive retailer compliance monitoring and testing a lottery cannot keep track of retailer fraud occurrences and must therefore refer to player complaints and allegations. To preserve reputational equity, lotteries need to be aware of the actual occurrences of retailer fraud, the associated risk levels involved, the likelihood of fraud being perpetrated, and the impact it may have on their organization. A broad variety of player protection measures are available to lotteries, from simple controls around the validation procedure to high technology solutions, such as ticket selfcheckers or player card systems. The effectiveness and viability of any of these measures largely depend on the regulatory and legal requirements within a lottery’s jurisdiction, and the size of the lottery’s retailer network. During my time as Director of Security and Compliance at Atlantic Lottery of Canada, WLA magazine | No. 35 | Winter 2011 / 2012

a retailer fraud incident caused significant disruption to the organization’s operations. Through this experience, I learned that a balance of player protection controls around the validation process at the retail site was most cost effective and efficient. Putting emphasis on the control the player has over the ticket validation procedure has been more effective than the broad implementation of technology. The most significant learning outcome, however, was that regardless of how many controls are in place, only continuous monitoring, testing, and enforcement provide measures as to the effectiveness of the controls and compliance requirements. The old adage, “what cannot be measured cannot be managed”, is especially relevant here. This lesson acted as a catalyst for Baseline Business Geographics to develop an automated compliance monitoring solution. They created a solution that couples Geographic Information Systems (GIS) and Global Positioning Systems (GPS) with mobile device technology. This allows for a cohesive workflow approach for retailer compliance inspection and testing, whereby inspectors can interact with retailers. Atlantic Lottery served as a pilot project for the Baseline Business Geographics solution. Working with lottery operators and regulators, Baseline Business Geographics has gained considerable lottery experience in security and risk management. They provide support in the management of retailer security risks and conduct retailer security assessments, implementing effective and balanced controls while optimizing compliance and inspection management solutions.

Baseline Compliance Manager Baseline’s core solution, Baseline Compliance Manager, is a risk-based, automated management program designed to meet the regulatory and policy requirements of compliance monitoring in a lottery’s distributed retailer network. Baseline Compliance Manager renders operational efficiency and delivers result-oriented metrics. It comprises an end-to-end management system that enables lotteries to demonstrably improve retailer compliance and integrity testing programs. This ensures that corporate policy and procedures as well as jurisdictional regulations are met. Baseline Compliance Manager also provides optimization for lotteries with existing compliance programs. Alternatively, it can serve as a framework for

operators that are in the process of establishing a compliance program. On the front end, Baseline Compliance Manager offers electronic forms on GISand GPS-enabled mobile devices, to facilitate data capture during field inspection and testing. Mobile devices, such as tablets, have a real time data link to a compliance back end database. On the back end, Baseline Compliance Manager supports workflow planning, inspection result analysis, and provides for immediate trending and performance reporting, as well as a progressive disciplinary follow up. In a distributed retailer and site network, Baseline Compliance Manager creates enterprise value through operational excellence by optimizing and automating a lottery’s security and compliance monitoring and inspection processes. It provides your organization with the operational measures and effective monitoring necessary to counter the retailer security risks common in most lottery operations. By Thomas Bierbach CISM, CISA Vice President, Business Development Baseline Business Geographics Inc.

About Baseline

Baseline Business Geographics Inc. is a global provider of integrated desktop, mobile, and Internet mapping and management solutions. They specialize in customized software development of GIS/GPS and mobile systems. As a solutions integrator, Baseline offers complete enterprise applications including data, training, consulting, project management and more. Baseline Compliance Manager, its end-to-end compliance management solution, enables lotteries to demonstrably improve their retailer compliance and integrity testing programs to ensure compliance with corporate policy, procedures and regulations. For more information on how Baseline can help your lottery, please contact Thomas Bierbach at [email protected].

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GOOD CAUSES G E T T I N GOOD G T H E M E S S AG E AC R O S S CAUSES The UK’s National Lottery Awards 2011:

Highlighting the achievements of the UK public’s favorite Good Cause projects Each year the UK National Lottery showcases, in a nationally-televised gala event, the Good Causes that it funds. Now in their eighth season, the National Lottery Awards highlight the positive effect that lottery funding has on society. The Awards demonstrate in a fun and engaging way to National Lottery players how the money they spend on a lottery ticket is being invested. The Awards also celebrate how the beneficiaries of National Lottery funding are putting the money they receive to good use. With over £27 billion raised for Good Causes since 1994, the UK National Lottery is undoubtedly a front runner when it comes to charitable giving. In fact, Camelot’s lottery operation returns more to society in percentage terms – at around 40% of total sales, made up of 28% in support of Good Causes and 12% in Lottery Duty to the government – than any other major lottery in the world. The 28% raised through ticket sales, specifically for Good Causes, is distributed by 13 independent National Lottery distributing bodies. These organizations work hard to ensure that the £30 million-plus raised each and every week makes a real difference to projects and charities across the UK. Since the UK National Lottery began in 1994, more than 370,000 individual lottery grants have been awarded. From cricket schemes for the disabled and arts

Mairi Morrison, Sense Scotland’s Head of Business Development, and Matthew Ward, a Sense Scotland client, received the UK National Lottery Award 2011 in the Best Health Project category. 14

centers to charities working with the deaf-blind and educational heritage initiatives, the distributors ensure that National Lottery money continues to make a real and life-changing difference the length and breadth of the country.

themselves are presented by a number of celebrity guest presenters. The winners from each category receive a £2,000 cash prize to spend on their initiative, as well as a stunning trophy to mark their achievements.

The National Lottery Awards

The Awards not only ensure that National Lottery-funded projects receive a high level of public recognition throughout the voting campaign and the national broadcast of the awards ceremony itself, but that they also receive long-lasting benefits. Featuring on television, in radio shows, online, and in numerous magazines and newspapers, the Awards open up a wealth of opportunities for all those taking part.

The annually-televised National Lottery Awards showcase the UK’s favorite National Lottery-funded projects across seven categories, with each category reflecting an area of lottery funding. Any project that has received National Lottery funding can enter the Awards. There were over 850 entrants this year – 70 of which were shortlisted by an independent judging panel and then voted for by the public. Competing for national recognition, the finalists attend a glittering gala event, which is broadcast on national television to millions of viewers. The awards

The team behind the Green Valley Centre, Wales, celebrated after winning the UK National Lottery Award 2011 in the Best Environment Project category.

The National Lottery Awards 2011 were televised live on BBC One on Saturday November 5, and presented by television and media

Mark Skipper, CEO of the Northern Ballet and Phoenix Dance Theater, and Martha Leebolt, principal dancer with the company, accepted the UK National Lottery Award 2011 in the Best Arts Project category. WLA magazine | No. 35 | Winter 2011 / 2012

GOOD CAUSES G E T T I N GOOD G T H E M E S S AG E AC R O S S CAUSES

The Green Valley Centre in Bryncynon, Wales, has transformed a longstanding local dumping ground into a thriving community garden. Occupational training and skills acquisition for project employees have been supported by UK National Lottery funding.

The Northern Ballet and Phoenix Dance Theater is one of the best-loved dance companies in the world. The new home for the Northern Ballet and Phoenix Dance Theater received £4 million of UK National Lottery funding through the Arts Council England.

Sense Scotland provides support for around a thousand deaf-blind and otherwise disabled children and adults every year. Lottery funding has been crucial to the organization’s development over the past thirteen years. WLA magazine | No. 35 | Winter 2011 / 2012

personality, Myleene Klass. Watched by over three million people, a host of stars lined up to celebrate the Good Causes and present awards to the winning projects. Adding to the glamour and sense of occasion was a performance by the chart-topping band, The Wanted, and a £10 million Lotto Superdraw, complete with a dazzling studio fireworks display. A number of video clips showcased the work of the winning charities and projects in attendance. From the Green Valley Centre, which created an oasis for their community in Wales, to Sense Scotland, which works with deaf and blind children and people with disabilities throughout Scotland, the evening highlighted how brilliantly diverse The National Lottery’s Good Causes are. Other winners included Northern Ballet and Phoenix Dance Theater, which received recognition for its excellent work developing dance and performance art in Yorkshire. The theater has a purpose-built centre, funded by The National Lottery, which enables students from local universities and academies to hone their skills. “Include Duchenne”, another charity funded by The National Lottery, won Best Education project for its work supporting children with behavioral and learning difficulties associated with Duchenne Muscular Dystrophy. The initiative has pioneered a new custom-built online literacy program, which is delivered in partnership between parents at home and a learning support assistant at school. Fresh from the popular British television show, Dragons’ Den, Hilary Devey presented the Best Voluntary/Charity project award to “Hands That Talk” from Northern Ireland. This project improves the quality of life for deaf people by providing access to employment, education, and services. National Lottery funding has allowed the project to train much-needed interpreters, giving the deaf community increased access to communication support. British Olympic middle-distance hopeful Hannah England, herself a beneficiary of lottery funding, together with former world champion hurdler, Colin Jackson, announced that the Bluebird Care Hampshire Disability Cricket Program had won the Best Sport category. The program uses National Lottery funding to motivate people with disabilities to play cricket, as well as to encourage them to become coaches and to advocate the inclusion of disabled cricket within clubs. 15

GOOD CAUSES G E T T I N GOOD G T H E M E S S AG E AC R O S S CAUSES “We Were Brothers: WW1 A Shared Heritage”, won the Best Heritage category award. This Northern Ireland initiative involves a play, a DVD, a book, an interactive website and a youth project, and remembers the First World War. Made possible by National Lottery funding, the program depicts the heritage of soldiers from both the Unionist and Nationalist traditions who served sideby-side with the British army. Congratulating all of the winners, Myleene Klass said: “National Lottery players raise over £30 million every week for large and small projects across the UK. The National Lottery Awards are a fantastic way of celebrating the enormous amount of hard work that goes into making these projects a success. All the finalists make a real difference to people and communities every day thanks to their National Lottery funding.”

The Include Duchenne project helps children with Duchenne Muscular Dystrophy, a serious muscle wasting condition with associated learning difficulties. The National Lottery funded a literacy program that supports the educational achievement of children with Duchenne.

Strong media support This year the Awards were supported not only by the BBC’s live coverage, but also by national newspaper The Daily Telegraph, while category sponsors were ivillage.com and consumer magazine, Best. This combination of media support helped to deliver an extensive amount of advantageous publicity during the campaign. “We Were Brothers: WW1 A Shared Heritage” reflects the positive effect of this media recognition. Journalist and author Felicity McCall told us how being part of this year’s event has improved the heritage project’s profile: “Since the Awards, we’ve had two offers to link with other projects; three approaches from possible funders; a media frenzy; a huge energy surge in the cast and crew; a 100 per cent increase in hits on our site; … we expect capacity audiences at our two performances later this month; networking has begun and can only grow, grow, grow!” Yorkshire-based Chances For Life provides support to young homeless people. In 2010 the group was named as runnerup in the Best Education category. Martin Crossland, Strategic Development Manager, said: “Taking part in The National Lottery Awards last year was a great experience. Being involved in the Awards helped to raise our profile, engage with the public and celebrate the work that we do – and of course appearing on national television was a great boost for our project! The support that we received from the community was fantastic.’’ 16

The Hands That Talk charity improves quality of life for deaf people by providing access to employment, training, and services. Lottery funding has allowed the project to train much needed new interpreters, giving the deaf community increased access to support.

Bluebird Care Hampshire Disability Cricket provides opportunities for the disabled to play the popular sport of cricket. National Lottery funding helps young people with learning and physical disabilities to become involved in their local mainstream cricket clubs. WLA magazine | No. 35 | Winter 2011 / 2012

GOOD CAUSES G E T T I N GOOD G T H E M E S S AG E AC R O S S CAUSES The National Lottery Awards 2011 The National Lottery Awards 2011 were launched in January 2011, and over 850 lottery-funded projects entered. An independent panel of judges selected a shortlist of 10 projects per category, which then competed in two rounds of public voting.

Northern Ireland’s “We Were Brothers” project remembers the heritage of soldiers from both the Protestant and Catholic traditions who served side-by-side with the British army in World War 1. The project was made possible by National Lottery funding.

The semi-final stage ran from May 31 – June 20, 2011. There were a total of 70 projects in the semi-finals – 10 in each of the seven categories. The three projects with the most votes in each category went through to the final round of public voting, except for in the Arts category, where there was a tie and four projects went through. The final stage of voting ran from September 2 – September 26 2011. There were a total of 22 projects in the finals – three in six categories and four in one category. There is only one winner in each category. All voting was independently adjudicated and verified by Electoral Reform Services. The seven winners named during the show, broadcast live on BBC One on November 5 2011, are as follows: Best Arts Project: Northern Ballet and Phoenix Dance Theatre, Leeds, England

The Surf Action charity uses surfing to help wounded combat veterans regain their confidence and boost self-esteem. The charity is sponsored in part by National Lottery funding.

Similarly, Surf Action, a project that works with service personnel returning from active duty by providing them with special therapeutic sessions to help them get back into community life, accepted a runners-up award in the Health category this year. By using the physical activity of surfing, the volunteers and instructors help combat veterans to regain their confidence and develop positive everyday skills. Rich Emerson, from Surf Action, said: “We beat hundreds of other projects from all over the UK to get to this stage. We are very grateful to everyone who gave us their support along the way. The Awards have given us a great opportunity to highlight the difference our project has made to the local community. It’s great to be able to thank National Lottery players for their investment and demonstrate the impact that their money can have.’’ WLA magazine | No. 35 | Winter 2011 / 2012

The National Lottery has transformed countless lives and communities across the UK, and the Awards continue to highlight this positive impact – reminding us that Good Causes really do change lives for the better on a daily basis. Dianne Thompson CBE, Camelot Group CEO, said: “The National Lottery Awards are incredibly important in demonstrating to National Lottery players how their money benefits a huge range of Good Causes. The Awards provide a platform for even the smallest projects to gain national recognition. Now in their eighth year, they really do continue to go from strength to strength in highlighting the positive impact these groups and charities have on people and local communities all over the UK.’’

Best Education Project: Include Duchenne, UK-wide Best Environment Project: The Green Valley Centre, Bryncynon, Wales Best Health Project: Sense Scotland, Scotland-wide Best Heritage Project: We Were Brothers: WW1 A Shared Heritage, Derry, Northern Ireland Best Sport Project: The Bluebird Care Hampshire Disability Cricket Program, England Best Voluntary/Charity Project: Hands That Talk, Derry, Northern Ireland

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GOOD CAUSES G E T T I N GOOD G T H E M E S S AG E AC R O S S CAUSES SPORTSTOTO –

A driving force for community and sports in South Korea SPORTSTOTO, in conjunction with the Korean Sports Promotion Foundation, is guided by the twin commitments of caring for people and building a healthy and strong Republic of Korea through successful sports development.

Sports betting was introduced in South Korea in 2001 in support of the FIFA 2002 World Cup held in South Korea and Japan.

Sport has the ability to bring a nation together, uniting all sectors of society. In many countries, sports betting has been an integral means of sustaining sports and sporting associations at many levels.

national sports. Since 2003, the sports betting business in Korea has been operated by SPORTSTOTO, Inc., a daughter company of the Orion Group, under exclusive license from the KSPO.

Sports betting in Korea was introduced in October 2001 by the Korean Sports Promotion Foundation (KSPO), in advance of the first Asia-based World Cup, the 2002 FIFA World Cup, with the goal of fostering public sports activities and financing

As the consigner or issuer of the sports betting license, the KSPO is responsible for regulating SPORTSTOTO, the consignee, and for allocating the profits of the betting business. In turn, the KSPO is regulated by the Korean Ministry of Sports, Culture, and

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Tourism, which is also responsible for approving business and sales plans. SPORTSTOTO itself is responsible for the overall operations and management of the sports betting business, including sales, payouts, system operation and maintenance, development of new games, and public relations activities. Since 2003, SPORTSTOTO has recorded consistent growth through the re-establishment of retailers, the development of a specifically Korean type of sports betting, and the extenWLA magazine | No. 35 | Winter 2011 / 2012

GOOD CAUSES G E T T I N GOOD G T H E M E S S AG E AC R O S S CAUSES sion of its customer base. To fuel this growth, both KSPO and SPORTSTOTO have sought continuously to improve the country’s policies and laws while at the same time increasing awareness of sports betting as a leisure game. As a result, sales of sports betting products reached US$1.61 billion in 2010 .

Funding sport throughout Korea SPORTSTOTO is committed to creating an environment where anyone can enjoy the benefits of sports. According to the National Sports Promotion Act, SPORTSTOTO funding is divided between the KSPO (78%), support for sports associations whose games are the object of betting (10%), projects designated by the Ministry of Culture, Sports, and Tourism (7%), and maintenance of public sports facilities (5%). The KSPO also receives additional funding through its other fund raising operations, which include cycle racing and motorboat racing businesses. Over the past ten years, total turnover of US$7.04 billion has contributed to a fund of US$1.89 billion for sports promotion, of which US$181.5 million was used to help construct the 2002 World Cup stadiums. More generally, the funds have been used to encourage sports activities in general, and to nurture youth sports and sponsoring sports associations. In 2007, South Korea’s total government budget for sports (US$156.4 million) accounted for only 0.09% of the country’s total national expenditure, significantly lower than that of Japan (0.4%), the United States (0.48%), Germany (0.9%), and Norway (1.6%). Since 2003, the KSPO has contributed the lion’s share of the national budget for

Offering the widest range of pari-mutuel products in the world, SPORTSTOTO has increased the popularity of less mainstream sporting events, such as women’s professional basketball and women’s professional football, professional volleyball, and professional golf.

sports and by 2011, the KSPO’s contribution accounted for over 80% of the total national sports budget.

Meeting the challenge of continuous growth SPORTSTOTO’s consistent growth is due to continuous innovation and new games. The company offers both pari-mutuel Toto games and fixed-odds Proto games. Toto issues 16 types of pari-mutuel games on five different sporting events, namely football, baseball, basketball, volleyball, and golf. For pari-mutuel products, SPORTSTOTO thereby offers the widest range of events and products in the world. Moreover, new games have been launched that reflect characteristics of the domestic environment, and SPORTSTOTO’s product portfolio has fulfilled customer demands

and revitalized unpopular sports. KSPO has also added to its product portfolio recently to support international sports events in Korea, such as the 2011 IAAF World Championship Daegu, the F1 Korean Grand Prix, the 2014 Asian Games in Incheon, the 2015 Gwangjoo Summer Universidad, and the 2018 Pyeongchang Winter Olympic and Paralympics Games. Proto fixed-odds games consist of two types, ‘long list’ and ‘winner list’, for soccer, baseball, and basketball. The Korean government applies rigorous regulations to these fixed-odds games, requiring that the annual payout ratio be restricted to 50–70%, the issuing of tickets be limited to twice weekly, and that each game be closed ten minutes before the kick-off of the first match. These restrictions notwithstanding, Proto has become the most popular betting game in Korea since its launch in 2006. In 2010, Toto sales were US$653.4 million and Proto sales were US$963.3 million, demonstrating a 2:3 issue ratio between pari-mutuel and fixed-odds games. This is a significant achievement in that it shows the importance of pari-mutuel products, which illegal gambling businesses cannot offer and only state lotteries can provide.

Funding from SPORTSTOTO is used to nurture youth sports, cultivating healthy, talented athletes. WLA magazine | No. 35 | Winter 2011 / 2012

KSPO and SPORTSTOTO originally utilized a foreign fixed-odds system that had numerous limitations, including high operation and maintenance costs, and response delays resulting from remote support by overseas operators. Consequently, it was considered essential to build a localized system. 19

GOOD CAUSES G E T T I N GOOD G T H E M E S S AG E AC R O S S CAUSES The localized system took two years to develop and was launched in April 2011 for all Proto games. The new system is expected to save US$1.2 million annually in operational costs, while dramatically improving operational effectiveness.

Putting funds to good causes Both KSPO and SPORTSTOTO are fulfilling their corporate visions and their responsibility for raising sports promotion funds in Korea. At the same time, they are returning profits to society, supporting a variety of good causes. KSPO serves the public good through its concrete support of a diverse range of sports activities, often with an emphasis on programs for children and the disabled. For example, it has recruited sports stars to offer lectures and to serve as role models for the young, with recent speakers including Olympic gold-medalists Soonyeong Kim (archery, 1988, 1992, 2000), Byeonggwan Jeon (weight lifting, 1992), and Hyunsoo An (short-track skate, 2006). It has provided US$175,000 for neighbor-caring projects, supplying wheelchairs and vocational rehabilitation programs to the disabled. And, as part of its mission to extend the scope of its activities throughout the world, KSPO sponsored 980 soccer balls for children in 14 African countries to commemorate the 2010 FIFA World Cup, celebrating the meaning of sport while sharing its pleasure. KSPO also operates sports associations directly for sports struggling financially, including cycling, marathon running, fencing, canoeing, and women’s soccer. KSPO earmarks US$6.2 million annually for these associations. It holds both the Tour de Korea and national motor boat and canoeing competitions to promote these sports, and it plans to support a diving association in the future. For its part, SPORTSTOTO – with its sports-oriented contribution to society – invests more than 70% of the company’s total budget in the development of sports and sports welfare, with its primary corporate social responsibility activity being the sponsorship of youth sports. A particular program of note is the “butterfly of hope,” which sponsors children with talent and capability from poor environments. Other programs include support for sports clubs in isolated areas, the holding 20

As part of SPORTSTOTO’s Total Supporting Service (ToSS) philosophy, the welfare of the disabled is sponsored through scholarships, through financing medical operations, and by funding admission fees to sporting events.

of sports events for primary schools, and the hosting of various youth sports events. SPORTSTOTO also actively supports sports for the disabled, sponsoring the Korea Sports Association for the Disabled, as well as the Committee of Special Olympic Korea, which is designed to direct public attention to the Special Olympics. SPORTSTOTO also provides sports supplies and equipment for athletes and sponsors various sports competitions for the disabled, and supports a diverse range of general sports activities so that all members of society have easy access to sports. For example, it sponsors sports clubs for children in low-income brackets, and sports equipment is provided to help improve the physical strength of vulnerable groups such as the disabled and children with cancer. Social and cultural welfare is yet another SPORTSTOTO focus. As part of its “ToSS” (Total Supporting Service) philosophy, the company sponsors the welfare of the dis-

abled through scholarships, through financing medical operations, and by funding admission fees to sporting events. SPORTSTOTO has been publicly recognized for its outstanding achievement to good causes. It won the eighth Korea Business Ethics Award in 2007 from the Korean Academy of Business Ethics, and in 2010 won the commendation of the Ministry of Education, Science and Technology for its contribution to the development of physical education in schools. SPORTSTOTO’s 2010 customer survey identified an increased awareness of its activities for the public good, especially for the young and the disabled, and this has helped to raise the company’s corporate profile.

Creating a culture of sharing In addition to their demonstrated support of good causes, both KSPO and SPORTSTOTO have worked to build a corporate culture of social responsibility among their employees. Introduced in 2007, KSPO’s voluntary “mileage for sharing” program has encouraged social contributions from staff. The program converts voluntary work, donations, and blood donations into mileage, and employees are rewarded in proportion to their mileage accrued. A total of 8,089 staff members participated in 2010, with an average of 37 hours participation per staff member. A remarkable 81% of all employees voluntarily donate a part of their salary (approximately US$1.75 to US$17.50) to create a reliable fund for good causes, with KSPO matching this contribution.

In April 2011 SPORTSTOTO launched a localized system for fixed odds sports betting for all Proto games. The system was two and a half years in development.

KSPO also has a volunteer group that regularly delivers support to the community, visiting welfare centers and delivering groceries to the WLA magazine | No. 35 | Winter 2011 / 2012

GOOD CAUSES G E T T I N GOOD G T H E M E S S AG E AC R O S S CAUSES disadvantaged. KSPO employees regularly donate blood to the Red Cross and also support patients with blood cancer. And to encourage co-development between rural and city areas, KSPO has affiliated with farm villages to offer a helping hand during the farming season, purchasing produce, improving outdated housing, and providing free medical check-ups. SPORTSTOTO has similarly created a culture of voluntary service. In 2005 it established TOPAZ, a voluntary service club, which was expanded and reborn as the “SPORTSTOTO volunteer ambassadors” in April 2007. Club members carry out voluntary activities four times a month. SPORTSTOTO staff also conduct sports activities during regular visits to the Daniel school, a special school for disabled children, and organize activities for disabled children like watching films and outdoor excursions. They also support activities for single mothers of infants and distribute free meals for seniors.

As a point of fact, unlawful online sports betting has increased significantly since 2008 and is now emerging as a major social issue in Korea, with some US$10.4 billion in annual turnover coming from almost a thousand illegal websites.

SPORTSTOTO supports activities to assist people of all ages and of all walks of life.

Company employees have also participated in special events since 2006, and SPORTSTOTO has hosted a variety of events including patient bazaars, one-day clubs for children with incurable diseases, blood donations, and voluntary service for flood victims. In June 2011, SPORTSTOTO hosted “Double Up” (pronounced the same as “together” in Korean), a bazaar in which all profits were donated to youth causes. Further, as an official sponsor of the Committee for the Special Olympics (Korea), SPORTSTOTO dispatched 15 employees to support Korean athletes who participated in the 2011 Special Olympic World Summer Games held in Athens, Greece.

Building responsibility and combating unlawful gambling The employees of SPORTSTOTO carry out numerous volunteer activities in an effort to promote love and compassion throughout their communities.

Amid all these activities, KSPO and SPORTSTOTO have built and maintained a heritage of responsible gaming, even as they face new challenges from illegal online gaming.

KSPO and SPORTSTOTO are pursuing two courses of action against unlawful gambling: track-down and differentiation. As the country’s exclusive providers of sports betting, both organizations are committed to supporting the government’s effort to crack down on unlawful gambling by delivering strong support for the identification and exposure of violators. At the same time, KSPO and SPORTSTOTO have enhanced their facilities to create a responsible gaming environment, something only legal operators can provide. In 2010, SPORTSTOTO further improved its responsible gaming environment by adopting the WLA Responsible Gaming Framework. As a result of those efforts, SPORTSTOTO was certified at WLA Responsible Gaming Framework Level III in 2010.

Positioning Korea as a sports powerhouse Clearly, South Korea is developing into an Asian sports powerhouse, competing in a diverse range of professional sports including football, baseball, basketball, and volleyball, and achieving outstanding success at international competitions. KSPO and SPORTSTOTO are committed to fulfilling the fundamental objectives of promoting both elite and grassroots sports in the Republic of Korea and to providing support for international sports events. Advertisement

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INSIGHT I N S I G HINSIGHT T Multi-jurisdictional games: The trend is growing In recent years the number of WLA member lotteries that participate in multi-jurisdictional games has increased. Multi-jurisdictional games, also known as block games, are well suited to meet the continuing trend toward higher jackpots and increased chances of winning. In this issue we present an overview of multi-jurisdictional games in Europe and America and look at how those games have been enhanced to meet this trend. We also take a brief look at some exiting new block games that are currently in development around the globe.

main numbers and the two Lucky Star numbers would claim the jackpot. One weekly draw was held each Friday evening. On May 7, 2011, several significant changes were introduced to Euro Millions. An additional weekly Euro Millions draw was initiated. This second draw, which takes place each Tuesday evening, provides for substantially larger roll-overs. It also offers players more opportunities to participate in Euro Millions. The first Tuesday Euro Millions draw took place on, May 10, 2011. Further changes to Euro Millions included enlarging the Lucky Stars matrix from 2/9 to 2/11, and creating an additional prize tier, providing a €4 prize for correctly selecting two of the five main numbers. These changes have enhanced a player’s overall chances of winning a prize from 1:24 to 1:13 – an improvement of 85%.

Europe’s Euro Millions On February 7, 2004 Euro Millions became the first multi-jurisdictional lottery game to operate across several countries. It was initiated through the combined efforts of La Française des Jeux (LFDJ), Spain’s Loterías y Apuestas del Estado (LAE), and Camelot, the licensed operator of the UK National Lottery. Lotteries from Switzerland, Belgium, Austria, Ireland, Luxembourg, and Portugal joined Euro Millions eight months later. To date Euro Millions has 10 participating lotteries from nine European countries with LFDJ conducting the draws in Paris. When Euro Millions debuted in 2004 it had a 5/50 game matrix and a Lucky Stars matrix of 2/9. Players correctly selecting all five 22

The players’ calls for larger jackpots and increased chances of winning have been answered by the Euro Millions organizers. Thus far, this has yielded positive results for participating lotteries. Since the May 7, 2011 changes, revamped Euro Millions has proved to be a success for Loterie Romande of Switzerland. They reported 39% more winners among the lower prize tiers (prizes under €30). Within the first six months after the changes, Loterie Romande also recorded 1.3 million winners of the lowest prize tier. The Tuesday draw has been well received, contributing to about 40% of Loterie Romande’s weekly Euro Millions sales. Likewise, La Française des Jeux reported a growth in Euro Millions sales of about 30%. However, owing to the high rollovers that WLA magazine | No. 35 | Winter 2011 / 2012

INSIGHT I N S I G HINSIGHT T Louisiana, began selling Mega Millions in the fall of 2011. Presently, only two states have chosen to remain selling only one of either game, with Florida selling Powerball and California selling Mega Millions.

have occurred within the short span of time since the changes took effect, this figure should be treated with caution. In each of the respective countries in which it is affiliated, Euro Millions continues to be the dominant lottery game. Euro Millions is proving so popular that lotteries are starting to introduce mobile and other real-time solutions for the game. Swisslos, the Swiss state lottery for the German and Italian speaking parts of Switzerland, recently introduced a Euro Millions application for the iPhone and the iPod touch. With the Euro Millions application, registered players can play Euro Millions on the go. Players can also receive updates on the winning numbers and the number of winners, and can also receive jackpot alerts. Further features of the Euro Millions application include: t 1MBZFSSFHJTUSBUJPO t 2VJDLQJDLTFMFDUJPO t ćFBCJMJUZUPTBWFZPVSGBWPSJUFOVNCFST t 1MBZFSBDDPVOUCBMBODFEJTQMBZ t 1MBZFSIJTUPSZ t 'VMMTZODISPOJ[BUJPOXJUIUIFQMBZFST Internet account. The Swisslos Euro Millions application went live on November 28, 2011.

America’s Powerball and Mega Millions For a number of years, the two lottery groups participating in America’s two leading block games, Powerball and Mega Millions, had discussed opportunities to cooperate in offering both products nationwide. Then, in early 2009, the Powerball group of the Multi-State Lottery Association (MUSL) and the Mega Millions (MM) group agreed in principle to proceed with a three-pronged strategy, which included the cross-selling of the two games, an eventual increase in the purchase price of one or both or the games, and ultimately in the development a new premium national game. In late 2009 the two groups reached a final agreement on the cross-selling of their respective flagship games. Under the agreement, participating member jurisdictions of each group were granted the right to sell both games. Thirty two of the Powerball jurisdictions and eleven of the Mega Millions states elected to begin selling both games as of January 31, 2010. Since that time, one additional MUSL state,

Within the first 22 months since cross-selling began, combined Powerball and Mega Millions sales rose from US$10.4 billion to US$11.8 billion – an increase of 13.2% compared to the 22 months prior to the initiation of cross-selling. Owing to the added player base that the cross-selling measure has afforded each game, Powerball’s sales grew from US$5.2 billion to US$6.3 billion, an increase of 21%, while sales of Mega Millions increased from $5.2 billion to $5.5 billion, an increase of 6%. Conversely, sales within the individual game groups increased by 5% to $5.45 billion in the Powerball jurisdictions, and by 21% to $6.35 billion in the Mega Millions states. This peculiarity results from the somewhat larger population and greater number of retailers within the Mega Millions states, as well as from Powerball’s greater brand recognition.

Changes to Powerball Just like the Euro Millions organizers, the Powerball group has answered the call for bigger jackpots and increased chances of winning. On June 24, 2011, MUSL decided on a number of measures to achieve these objectives with Powerball.

With the Euro Millions iPhone application from Swisslos, registered players can play Euro Millions while on the go. The application syncs securely with players’ Internet accounts. WLA magazine | No. 35 | Winter 2011 / 2012

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INSIGHT I N S I G HINSIGHT T Currently, Powerball has a game matrix of 5/59 with an additional Powerball matrix of 1/39. Players correctly hitting all five main numbers and the Powerball number take home the Powerball jackpot. There are two weekly Powerball draws, on Wednesday and Saturday evenings. Powerball’s purchase price is US$1. The starting jackpot for Powerball is US$20 million. An optional Power Play feature increases the winnings in the US$3 to US$10,000 categories by a factor of 2, 3, 4, or 5. The Power Play option multiplier does not affect the second tier prize, which goes to players who match five of the 59 main numbers without hitting the Powerball (5+0). But it does increases the second tier prize payout from US$200’000 to US$1 million. Players can select the optional Power Play feature for an additional US$1. Among the changes the Powerball group decided upon in June 2011 was an increase in the Powerball purchase price from US$1 to US$2 per play. This measure has allowed for a doubling of the starting jackpot. When the price change takes effect on January 15, 2012 the starting jackpot will rise to US$40 million. The second tier prize, will increase from US$200,000 to US$1 million. Matching only the Powerball, which has until now provided a US$3 win, will yield a US$4 win. The Power Play feature will continue to be offered for an additional US$1, but will increase the second tier prize from US$1 million to US$2 million. The Powerball group has also introduced another measure that is designed to improve the player’s odds of winning. The Powerball matrix will shrink from 1/39 to 1/35 while the game matrix will remain at 5/59. This will increase the odds of winning the jackpot from 1 in 195.2 million to 1 in 175.2 million. The overall odds of winning a cash prize will also improve, moving from 1 in 35 to 1 in 31. This measure will take effect together with the price increase on January 15, 2012. Powerball is currently played in 42 states, Washington D.C., and in the US Virgin Islands. The changes to Powerball are supported by a consensus of the participating Mega Millions states. Historically, Powerball has shown stronger baseline sales and greater brand recognition than Mega Millions. This made it the logical choice of the two games when it came to implementing such changes.

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A cooperative advertising campaign has been developed and will be used by 22 of the 44 participating jurisdictions when the revamped Powerball is launched in January 2012. The campaign centers on a theme of MORE (million dollar winners), BIGGER (jackpots), and BETTER (odds of winning).

Looking forward: A new Premium Game for America A cooperative effort to develop a new premium national game that will be offered by the lotteries participating in Powerball and Mega Millions began in earnest in June 2010. This effort was initiated by a joint committee comprised of members from both groups, as well as representatives from three of the leading vendors in America – GTECH, Scientific Games, and Intralot USA. Pollard Banknote of Canada has also recently joined the group as a participating vendor. Cooperation between the two lottery groups and the participating vendors has been outstanding. The committee activity initially centered on creative game development, together with player/consumer research. These activities were completed in early 2011. Since spring 2011, the committee has focused on refining the concept, ultimately settling on a twopart hybrid game. The game concept utilizes printed tickets with an instant win feature and entries to be made via the Internet for weekly drawings of higher tier prizes, including a large number of $1 million prizes and experiential prizes, possibly to be provided by national sponsors. The tickets are expected to be sold at existing and newly recruited lottery retailers, with lower tier prizes being paid by directly by the retailer and drawing prizes being paid by the participating lotteries. It is also anticipated that the game will leverage its marketing and communications strategies through a national advertising campaign coupled with the use of social media platforms.

final recruitment of participating lotteries is expected to be completed by May 2012. Current plans call for a game to be launched in autumn 2012.

Looking forward: The World Lottery Draw The development of a world game has been ongoing for the past several years. This effort has been spear-headed by Camelot of the UK, La Française des Jeux of France, and MUSL of the USA. Other Euro Millions participating lotteries, as well as lotteries from Europe and Australia, have lent their support to the effort. Several game concepts have been developed through ideation and refined to four separate game concepts, which were tested through qualitative consumer research conducted by six European lotteries, five American lotteries, and one Australian lottery. The research revealed a strong concept, favored by all parties, which is being further refined through the game development and ideation processes established by the three lead partners. The favored game concept draws upon key assets and attributes of existing lottery games. More detail will be revealed about the proposed game, structure, and parameters over the course of 2012. The project team has planned for a launch date around late 2013 or early 2014. However, the launch date comes with a caveat, owing to the recent repositioning of Euro Millions and Powerball. (See above for details.) The world game project team has agreed to wait before decisively committing to a launch date for the world game, until the performance of the Euro Millions and Powerball enhancements can be analyzed and fully understood. The three partners, and the project team, remain committed to the project and will carry on working on the initiative and on other multi-national opportunities.

Games in other regions Other well-established multi-jurisdictional games exist in other regions and countries of the world. Canada has LOTTO Max and LOTTO 649, Australia has OZ Lotto, and in the northern countries of Europe there is Viking Lotto. Block games for Africa and Latin America have also been on the drawing table. We will be following trends and developments in the world of block games and reporting on these in subsequent issues of the WLA magazine.

Additional research, both qualitative and quantitative, plus further game refinement, and technology development, will be considered over the next several months. The WLA magazine | No. 35 | Winter 2011 / 2012

INSIGHT I N S I G HINSIGHT T

Product innovations of 2011 Responding to new technologies and changing consumer desires, WLA members continue to stress diversification and novelty in their search for new games and product lines. Below we showcase a few product innovations that have occurred within the past 12 to 18 months.

GeoSweep In issue 34 of the WLA magazine we reported on GeoSweep, a new innovation in online gaming. GeoSweep, licensed by the Londonbased Roboreus Limited, is the brainchild of brothers James and Henry Oakes.

GeoSweep, launched in the UK by the brothers James and Henry Oakes, combines Internet gaming, online map technology, and social media, to yield a fun and engaging locationbased lottery game.

GeoSweep is designed with the Generation Y player in mind. It replaces traditional lottery numbers with locations on a map. The GeoSweep concept leverages the insight that places are more interesting and emotive to younger players than randomly selected numbers. GeoSweep combines social media and online map technology to yield a location-based lottery game that is fun and engaging. Owing to GeoSweep’s full integration of Facebook and Twitter, players can easily share their gaming activity with friends and family. The initial GeoSweep interactive draw game was developed over a two year period to ensure ease of play and the utmost security and responsible gaming standards. The GeoSweep interactive game was launched in October 2010 and ten thousand player accounts were secured in the first week with 80% of those players choosing to subscribe to the product.

GeoSweep involves the selection of a square plot of land on a map, called a Geo, which is entered into two daily draws. 26

The game is played by selecting a square plot of land on a map. That plot, called a Geo, is chosen by navigating an interactive map based on Google Maps technology. Two draws take place daily. The GeoSweep draw is the main draw and if your Geo is selected directly, you win the jackpot. If you occupy a Geo within WLA magazine | No. 35 | Winter 2011 / 2012

INSIGHT I N S I G HINSIGHT T the Prize Zone of the winning Geo, then you win a secondary cash prize. The Prize Zone is a square area, several times larger than a single Geo, which surrounds the winning Geo. The Daily Guaranteed draw is the second daily draw. It is similar to the GeoSweep main draw, although only occupied Geos are entered, increasing the player’s chances of winning a prize. Initially, a player could occupy a Geo for 30 days for the price of £3. This entitled them to a daily chance at a £1 million jackpot over the 30-day period. Within the first eight months of operation, no one was able to capture the main GeoSweep jackpot of £1 million. To improve the odds for players, the price and prize structure were changed on July 20, 2011. One Geo is now occupied for 100 days at the price of £1. The daily jackpot has been reduced from £1 million to £100,000 and the daily guaranteed win has been reduced from £1000 to £100. Now players have 100 chances of winning £100,000 instead of 10 chances of winning £1 million. Further, the Prize Zone has been expanded from 100 Geos to 500 Geos. Still, as of the time of this writing, the main GeoSweep jackpot has remained elusive. In June 2011 GTECH Corporation and Roboreus Limited entered into an exclusive worldwide agreement to market and deploy GeoSweep to lotteries around the globe. Roboreus Limited and GTECH are currently working on a retail-enabled version of GeoSweep suitable for uptake by US lotteries and other lotteries that may not have an interactive platform.

remains popular in Switzerland. Aiming to bring bingo to what they term the “Facebook Generation”, Swiss lottery operator Swissloss went live with online bingo on April 27, 2011. Swisslos Bingo, found on the Internet at www. bingo.ch, combines the traditional bingo game with online technology and social media. When the Bingo website went live in April it offered one variation of 90-ball bingo called “Moonshine” and two variations of 75-ball bingo called “Choco” and “Lucky 7”. On November 1, 2011, Swisslos expanded the game palette to include two additional 75-ball Bingo variations, “Gratissimo” and “Bulls Eye”. As soon as a player opens an account with Swisslos online and registers a nickname, they can begin playing Bingo. During and between each Bingo drawing, players can share their enthusiasm for the game with other Bingo players by way of a chat window on the website. The chat window provides a community aspect to the game that is analogous to the sense of community found in the traditional bingo hall. Bingo is available for play online from 7:00 to 23:30 daily. Swisslos plans to extend the daily play schedule in the near future. Players have shown remarkable interest in Bingo. Swisslos has an estimated 330,000 registered players on their Internet-gaming platform; of those, more than 25,000 have played Bingo since it went live.

LOTENAL: The Mayan Prophecy Throughout its more than 240 year history, Lotería Nacional para la Asistencia Pública (LOTENAL) has been raising funds for the benefit of Mexican society. Keeping with this tradition, LOTENAL General Director Mr. Benjamín González Roaro announced the launch of a new game entitled “Profecía Maya (The Mayan Prophecy)” in October 2011. At the outset, various proposals for the new game were developed. The budget of the average Mexican consumer was taken into consideration in the development of the price range. A final price of 20 pesos per game was decided on, as was a jackpot of 8 million pesos. The total prize payout covered over 23 thousand individual prizes per drawing. With the price and the prize structure decided, it was left to find a theme for the game that would have relevance for Mexican players. Games that offer entertainment while celebrating the historical heritage of the Mexican people fit this category well. As the Mayan culture is central to the history

Seeking to expand its gaming portfolio, Atlantic Lottery of Canada has partnered with Roboreus and are looking to launch GeoSweep in the Atlantic Provinces of Canada toward the end of April 2012. Atlantic Lottery will be the first WLA member lottery in the world to launch this innovative game.

Swisslos Bingo: Tradition meets the Facebook generation Bingo has a long tradition in Switzerland, customarily being played in the local village cafe for low stakes and modest prizes. Although the number of younger players populating the bingo halls has dwindled, the game WLA magazine | No. 35 | Winter 2011 / 2012

Swisslos’s bingo website, catering to the Facebook generation, combines the traditional bingo game with online technology and social media. 27

INSIGHT I N S I G HINSIGHT T

Pek the dog, Kan the snake, Tuul the rabbit, Aak the turtle, Tzotz the bat, Dsek the scorpion, Keh the deer, Moan the owl, and Kutz the turkey. Each of the 13 symbols represents a particular time of the year. As such, players tend to endow a particular symbol with their own personal meaning, choosing a specific symbol as their lucky symbol. The symbols are also said to have a metaphysical influence on attracting good fortune. The ornate Profecía Maya tickets are sought by co collectors and an album for this purpose is also available from LOTENAL. The album is co complete with a history of the Mayans and their astrological and geological knowledge as it relates to the Mayan calendar. It provides a brief tour of ancient Mayan cities and attempts to explain the mysterious legacy of the Mayans. Upon completing the album, collectors may present it at the LOTENAL offices and receive a gift for their loyalty.

LOTENAL’s Profecía Maya offers players an entertaining game that celebrates the historical heritage of the Mexican people.

of Mexico it was decided to create a game around this theme. The game and its promotional campaign depict the Mayas and their contributions, not just to the Mexican culture but also to humanity as a whole.

According to the Vice President of Government Funds and Lotteries, Mr. Fabio Cleto, “Linking special lottery draws to the most important holidays of country has shown astounding results. Brazilian players tend to mark these draws in their agenda, increasing their participation in the games, hence increasing sales.” A total of four of these special lottery draws have been planned. Each one is held in association with a particular holiday and is connected with one of four yearly draws. The first was launched in connection with the Mega-Sena in 2009. Held on the last day of the year, the Mega-Sena, also known as the “Mega da Virada” (the big rebound), is Brazil’s main lottery attraction. Continuing this strategy, the second product selected for a special draw was Quina. The draw was named Quina de São João, referring to the traditional celebration of Saint John’s day. This is an important holiday for Brazilians, especially in the northeastern region of the country. On June 24, 2011, the celebration of Saint John’s day, Brazilians also celebrated the drawing of the Quina de São João.

Inaugurating the game, LOTENAL General Director, Mr. Benjamín González Roaro stated, “Today, more than ever, there is a need to reconnect with success and abundance. We hope that year 2012 will bring success and abundance into your homes and lives. The luck and fortune that the Mayans predicted is now at hand.”

Passive or traditional lotteries – those involving pre-numbered tickets – are very popular in Mexico. For this reason LOTENAL decided to take this approach in developing Profecía Maya. The tickets for Profecía Maya are printed in 13 lots, with each lot represented by one of 13 Mayan calendar symbols. Each ticket within a lot has a four-digit number, running from 0000–9999, making a total of 130,000 tickets on sale for each drawing. The drawing is held on the last Sunday of each month. The 13 Mayan calendar symbols represented in the game are Itzama the iguana, Batz the monkey, Coz the hawk, Balam the jaguar, 28

Caixa: Linking special lotteries to holidays Caixa Econômica Federal (CAIXA) of Brazil has taken steps to modernize their lottery products and boost sales by establishing special draws in conjunction with some of the country’s major holidays. Combining holiday activities with a lottery draw lends these special lotteries a festive spirit and a strong visual identity.

Associating special draws with important holidays, such as the Quina de São João with Saint John’s day, has positively affected CAIXA’s sales.

The total prize payout of the Quina de São João totaled R$ 76.8 million (US$ 41.5 million). 1 “The size of the prize payout was an overwhelming factor in making the Quina de São João drawing a major success”, commented WLA magazine | No. 35 | Winter 2011 / 2012

INSIGHT I N S I G HINSIGHT T Mr. Cleto on the increase in sales generated by this special draw. This is an absolute record for Quina and the seventh largest payout in the history of the Brazilian state lotteries. Until then, the highest amount ever paid out in a Quina draw was R$ 9.1 million (US$ 4.9 million), which occurred in August 2010. In its premier drawing, the Quina de São João made five new millionaires, each earning R$ 13.5 million (US$ 7.3 million).

Pronósticos: New twists on popular games Mexico’s largest lottery by sales, Pronósticos para la Asistencia Pública created new options for two of its sports and lotto products and added a new lotto game to its lineup in efforts to attract new players with both larger prizes and more prizes overall. For its popular Progol sports category, Pronósticos increased the top prize and added a midweek version, Progol Media Semana. By doubling Progol’s guaranteed minimum prize payout from 2.5 million to 5 million pesos, and significantly increasing lower prize levels, Pronósticos achieved a sales increase of 268 million pesos over two years. The lottery funded the prize increase by raising the ticket price from 10 to 15 pesos. Progol Media Semana is composed of

nine games from Tuesday through Thursday at a 10 peso price point. The lottery expects incremental sales of at least 90 million pesos annually from this extra midweek option. On the lotto front, Pronósticos launched Melate Retro 6/39 in May 2010 to fill a market niche not previously covered. The new game offers top prizes in the range of 5 to 10 million pesos and more overall opportunities to win. In August 2010, Melate Revanchita was added to the Melate game portfolio, offering a third chance, along with Melate and Melate Revancha, to win with the same set of numbers. The goal is to increase sales by attracting new customers and by converting existing casual players into more frequent regular players.

means offering products that take advantage of the latest technologies. For others, it means associating games with unique cultural heritages or traditions. In all cases, the price, prize structure, and play features are carefully designed to maximize sales, and hence revenues to good causes.

A common goal: attracting new players The innovations presented in this article have one thing in common – a desire to reach new audiences and attract new players. For some, that

Through changes to Progol and the Melate game portfolio, Pronósticos has won new players and increased sales.

1 Actual exchange rate of the Central Bank of Brazil on November 24, 2011, was R$ 1.00 = US$ 0.54

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INSIGHT I N S I G HINSIGHT T Opera: Wagering with the devil Can lotteries learn anything from the drama of the opera? Do musicals present a realistic portrayal of life with regard to gaming? Continuing our series on gambling in the arts, gaming expert Göran Wessberg presents a selection of operas and musicals that address the topic of gambling in society. One might ask, “What is an article on operas doing in the WLA magazine”? The highlight of any lottery is of course the draw, that final moment that decides if you win or lose. Similarly, at the climax of an opera, the roll of the dice or the turn of a card often determines the outcome of the story.

The 19th century composer, Pyotr Ilyich Tchaikovsky – The Queen of Spades.

Let’s start with Tchaikovsky’s Pikovaya dama (Queen of Spades), based on an intense short story by Pushkin. Hermann, a young officer with no money and no position in society, wants to know the secret of a duchess, which is that she once traded amorous favors for the secret of three winning cards in the game of faro. By scaring the duchess to death and seducing her niece, Hermann obtains this knowledge, and dares to stake all at a party. He wins the first two rounds, but, when finally challenged by the former fiancé of the duchess’ niece, he does not receive the ace he expects. Rather, he gets the Queen of Spades. The old lady has had her revenge, and Hermann shoots himself. The aria Three cards rings in your ears as you leave the auditorium. Prokofiev’s opera Igrok, an adaptation of Dostojevskij’s famous novella The Gambler,

is all about ob30

Sergei Prokofiev’s the Gambler adapted from Dostojevskij’s novel by the same name.

session. Spectators particularly look forward to the fourth and last act, which is set in a casino where young Andrej is enjoying a marvelous run of luck. To the amazement of the other players, he successfully stakes on winning on red repeatedly. But when he presents all his winnings to his beloved, who is indebted, in order that she may save herself and her honor, she just throws the money back to him and leaves him in despair: lucky at cards, unlucky at love. So, what’s the use in winning? This is a question you can ask yourself while watching the third act of Verdi’s timeless story of grand passion, La Traviata. Violetta’s one-time lover and admirer Alfredo meets her again at a party after their enforced separation. There, he challenges Baron Duphol, the new protector of Violetta, at a game of faro – that ominous 19th century game of cards – and wins a great sum. However, the winnings he throws at her are not to save her honor – they are rather, as he puts it, to “pay a whore”. This remark is something he of course comes to regret. He takes his words back in the last act at her death-bed, when he understands her motives in professMaria Callas performs ing love for Guiseppe Verdi’s La Traviata. the Baron. Faro is a crucial game in Jules Massenet’s Manon, too. The game is played in the first act when Manon’s cousin, who was to look after her, forgets his commission after being invited to play cards, saying: “My love is the Queen of Spades”. Gaming is even more important in the third act. Manon’s former lover, young des Grieux, is training to be a priest. Seduced by the charms of Manon, he

stakes all the money his father has given him, hoping to win the wealth she craves. He enjoys a winning streak, but to no avail, Victoria de Los Angeles’s be cause his 1955 recording of Manon opponent and by Jules Massenet. rival, Guillol, accuses him of cheating and calls the police. Des Grieux and Manon are arrested as Guillol sings, “The wise knows that gambling is an art.” While gambling is important in Manon, it is even more so in Puccini’s La Fanciulla del West (The Girl of the West). Since this opera is set in the Wild West around 1850, the game in question is of course poker. In the Polka Saloon the goldminers meet to drink and play cards. The climax comes at the end of the second act when the heroine Minnie is prepared to play a game of life and death with the sheriff – who happens to be in love with her – in order to save the man she loves and whom she has hidden, the wanted bandit Ramerrez. If she wins two rounds out of three, the sheriff will let Ramerrez go. In the final game the sheriff has trips in Kings. Minnie has an extra ace hidden in her skirt, however. Enrico Caruso (1873-1921), By cheating, in Puccini’s opera La fanshe wins, and ciulla del West (The Girl of Ramerrez is the West). saved. WLA magazine | No. 35 | Winter 2011 / 2012

INSIGHT I N S I G HINSIGHT T Let’s stay in the US but move down south to the Mississippi with its fabled river boats. Traditionally, river boats have been a popular venue for casinos and similar forms of entertainment, well illustrated by Jerome Kern’s musical Show Boat. Magnolia, the daughter of the theatre director and river boar captain, falls in love with and eventually marries Ravenal, a notorious but elegant and charming gambler. She gives birth to a daughter. They leave the stage and try to live on his luck at the green tables. For some time Ravenal hides his bad luck from her, as highlighted in the aria Why Do I Love You? Realizing that his addiction to cards will not only ruin himself but also the lives of his wife and child, he leaves them to support themselves. Actors Annalisa Ericson and As this is a Nils Poppe in the 1942 promusical, the duction of Jerome Kern’s family is – of and Oscar Hammerstein’s course – remusical “Show Boat” at the united at the Oscarsteatern in Stockholm. end. Reunion with his beloved is also the dream of the poor crippled black man Porgy in Gershwin’s Porgy and Bess, set down south among the cotton pickers at the tenement Catfish Row. The cotton pickers meet for their Saturday card game, eagerly supported by the drug peddler Sportin’ Life, who leads the players astray not only with drugs, but also with false hopes of good luck by means of his loaded dice. The only man who does not get addicted to gambling is Porgy himself, who instead falls in love with Bess. But Bess leaves him for Sportin’ Life, and the pair go try their luck in New York.

The New York Harlem Theatre production of Porgy and Bess.

Perhaps Porgy will meet Bess in New York in the same quarters of “The Big Apple” that you’ll find the petty thieves and tricksters WLA magazine | No. 35 | Winter 2011 / 2012

of Damon Runyon’s short stories, some of which were put to music by Frank Loesser in the hit Broadway show Guys and Dolls.

The main plot centers around a bet The libretto from that gambler Sky the 1978 production Masterson makes of Frank Loesser’s with Nathan Detroit, Guys and Dolls. who “earns his income” by organizing illegal dice tournaments. Sky must succeed in taking any girl that Nathan picks for a trip to Havana. The girl is Sarah, a young woman working for a small Salvation Army district office. Sky and Sarah go to Cuba, but on their return Sarah sees her office raided by the police, hunting for Nathan’s players. With the office facing closure, Sky offers anyone in the gang a thousand dollars if they beat him at dice. However, if he wins they will have to go to the Salvation Army to confess their sins and be reformed. No surprise, then, that Sky wins and produces twelve sinners for Sarah. The office is saved and Sarah and Sky can marry. But, have the sinners really been reformed? No, or as one of the tricksters confess: From now on I will be a good guy – and a good gambler. Gambling is paid tribute above all in the song The Oldest Established.

Another kind of establishment is Mahagonny, the “city of nets”, founded by Kurt Weill, Bertolt Brecht. three fugitives from justice in an American desert. In the second act of Kurt Weill’s opera Aufstieg und Fall der Stadt Mahagonny (Rise and Fall of the City of Ma hagonny), with a libretto by Bertolt Brecht, the citizens abandon themselves to total permissiveness, indulging in wanton glut tony, drink ing, hedonistic sex, and reckless betting. Jimmy, a lumberjack who stakes all his money on his friend Joe in a boxing match, loses it all when Joe is killed in the ring. Unable to pay for this bet, and for drinks, he is sentenced to death, having committed the worst crime in this city – and in the world of gamblers as well – that of not being able to settle one’s debts.

Death comes to us all, especially on the opera stage. So it goes also in Stravinskij’s The Rake’s Progress. In this Faust-inspired story, Anna Trulove and Tom Rakewell fall in love, but Tom is tempted for a life of luxury and wealth by the Mephistophelian Nick Shadow. After Tom has enjoyed “the good life”, Nick demands Tom’s soul at a cemetery. In an effort to save himself, Tom suggests a game of cards. Once more, as in the Queen of Spades, there are three fatal cards to be picked. But with the help of Anne Trulove’s distant voice, Tom manages to choose the Queen of Hearts twice, thus depriving Nick of his soul. Defeated, Nick condemns Tom to madness, and Tom dies from grief. As the curtain falls, this moral is heard: “For idle hands, and hearts, and minds, the Igor Stravinskij Devil finds a work to do.”

Faro Faro is a card game that originated in Italy and France in the late 17th century. The game is played with a suit of cards from Ace up to King. Players bet on the card rank of their choice. The dealer exposes cards in pairs, a winner and a loser, and pays out or collects accordingly. Its closest modern relative is Baccarat. Faro became very fashionable in Europe during the eighteenth century, owing to its fast action, easy-to-learn rules, and better odds than most games of chance. It had fallen out of vogue there by 1820, but became extremely popular in America, owing to the influx of European immigrants occasioned by the Gold Rush. By the twentieth century, Faro had waned in popularity in the US, possibly owing to the incidence of cheating. Cheating was prevalent enough that several editions of Hoyle’s Rules of Games began their faro section warning readers that not a single honest faro bank could be found in the United States! Today it is not much played, with the last faro “bank” or table closing in 1975 in Ely, Nevada.

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CORPORATE NEWS C O R P O R ATCORPORATE E NEWS NEWS

Integrated product management services: The science behind sales performance As the business of lottery becomes more complex in markets around the globe, a lottery’s mission for sales performance remains unchanged. Some of the highest performing lotteries in the world have discovered that integrated product management is the driving force behind sales and profit growth. The ever-increasing complexities of security and responsible gaming requirements, networked technology, new retail channels and player demographics are changing how lotteries do business. Over the last several years, lotteries are realizing the need for integrated product management services – from market analysis, to game development, instant ticket manufacturing, inventory management, retail support and in-store optimization.

From zero to CNY 20 billion in three years In China, where the China Sports Lottery has become one of the fastest growing lotteries in the world, integrated product management is the science behind the success. Launching with 150,000 retailers and achieving CNY 10.1 billion in sales its first year, the China Sports Lottery is considered one of the largest start-ups in lottery history. 32

Interestingly, the China lottery market is very unique. There are two competing national lotteries and both sell similar products in the same locations. Serving over 1.3 billion people – 20 percent of the world’s population – the China Sports Lottery launched an instant product with the opening of the 2008 Olympics in Beijing. In less than six months, the Lottery has expanded from one province to all 31 provinces across China. Sales are projected to reach nearly CNY 20 billion by the close of 2011, almost doubling 2008’s retail sales. “China has a complex, competitive lottery environment,” says Sam Wakasugi, Chief Marketing Officer for Scientific Games China. “From the beginning, we integrated global best practices in the area of product management – game design, systems, terminals, marketing, and research – every decision has been data-based and implemented with knowledge gained from lottery

start-ups around the world. This has been the differentiator.” The majority of the games launched by the China Sports Lottery have been games that are proven best-sellers elsewhere in the world.

NBA licensed games have increased instant sales at the China Sports Lottery. WLA magazine | No. 35 | Winter 2011 / 2012

CORPORATE NEWS C O R P O R ATCORPORATE E NEWS NEWS In fact, the Spotlight Game™ Golden Million and the Gem Family of games – Ruby Red, White Diamond, Green Emerald, and Triple Diamond – are some of the most popular instant games in both the U.S. and in China. In 2011, two National Basketball Association (NBA) licensed games are largely credited for boosting China Sports Lottery instant sales toward the CNY 20 billion mark. The NBA games also had an Internet component offering players the opportunity to enter nonwinning tickets for second chance prizes. The Lottery had over four million entries via mobile phone connected through the Internet. “We’re simply applying global best practices for lottery product management. With Scientific Games’ MAP™ analytics, we’ve studied 29,000 instant games and over 1.25 million weeks of sales data, so we know what works and what doesn’t. Historically, when we design a game based on solid best practices and then localize it to the market, the game is going to sell well to consumers in any country,” said Wakasugi. “Because of our global reach, Scientific Games has a finely tuned ear to the lottery game culture. A game has to offer attractive play attributes, visual appeal, good odds and be positioned properly in the market from a price and ticket size standpoint.”

installation of game management systems, telemarketing, field sales, and retail development. Programs are customized for each lottery and may also include research, product reviews, player analysis, inventory and distribution, sales staff training, and consultative advice on other key areas of the business.

Olifeja doubles sales In Eastern Europe, where an expanded partnership between Lithuania’s Olifeja and Scientific Games began in early 2011, lottery sales doubled in the first five months of the integrated product management program, exceeding expectations. Olifeja expects sales to double again by year’s end, then double once more in 2012. “We tailor every CSP to meet the specific requirements of the lottery jurisdiction,” said Allen. “The partnership allows us to get

One of the top 10 performing lotteries in the US, the Pennsylvania Lottery is the only lottery in the country that exclusively benefits the state’s older residents. Since its first game went on sale in 1972, the Pennsylvania Lottery has contributed more than US$21.5 billion in services for Pennsylvania seniors, funding transit and prescription drug programs, long-term living services, Area Agencies on Aging, and senior community centers.

“Over the 26 years that Scientific Games has provided Cooperative Services Programs to lotteries around the world, we have demonstrated a strong track record in responsibly increasing sales and net returns to the lotteries’ beneficiaries,” says John Schulz, Vice President of Cooperative Services for Scientific Games. “Our approach is focused on developing integrated programs for complete instant ticket product management.”

Many of Scientific Games’ best practices were incubated in the US, beginning in the mid1980s with the concept for a customized Cooperative Services Program (CSP) with the highly successful New York Lottery. After several variations, the model was brought to Italy in 2002 and applied to the re-launch of the instant game category known as Gratta e Vinci. The integrated product management approach helped drive instant ticket sales from €411 million in 2004 to over €9 billion in 2010. Gratta e Vinci has become one of the biggest lotteries in the world.

The science of integration At top performing lotteries, science is infused into the products, systems, and processes. Integrated product management applies an end-to-end program to the product life cycle, building a bridge between design and execution. This science delivers efficiencies to the lottery and provides product value to the player. It equips a lottery with proven best practices to successfully manage the complexities of an ever-evolving business environment.

“Our CSP program is a consumer-oriented approach that manages multiple variables and brings end-to-end improvements and efficiencies across the supply chain,” says Chris Allen, Vice President, Instants Marketing for Scientific Games. “It’s about best practices, but it’s also about innovation and distribution expertise.”


More funding for Pennsylvania seniors

Fourteen years ago, the Pennsylvania Lottery began a CSP program with Scientific Games. Since FY 1996-97, instant ticket sales have increased by nearly 370 percent – growing from US$409.2 million to US$1.9 billion in FY 2010-11.

Launching success in Italy

Scientific Games has a portfolio of products and services that allows it to integrate product management, including instant tickets, technology, facilities management, design and

a holistic view – we work closely with the lottery to analyze game product, players, the retail marketplace and supply chain from top to bottom. It also allows us to have more detailed conversations about opportunities for revenue growth.”

Gratta e Vinci has become one of the biggest lotteries in the world.

With the ability to integrate the functions of product management, a lottery has the greatest potential for immediate and longterm success – and most importantly, to grow contributions to good causes in a socially responsible manner.

33


The New World of Retail New technologies, shifting consumer preferences, evolving retail operating models, and product relevance are just a few of the variables lottery operators must continually assess to sustain and grow sales. Often, self-service turns out to be a viable solution. To survive in the retail world, businesses must continually respond to consumer trends. For example, over the last decade, retailers have adopted new service formats to counter the effects of e-commerce shopping. As technology has enabled consumers to purchase goods and services without having to physically visit stores, retailers have responded by offering more convenience at retail outlets. 34

Some of the most successful retailers across the globe, such as Carrefour, Tesco, Metro Group (REAL), Wal-Mart, and McDonald’s, are all engaging with customer convenience solutions that are proving popular and profitable. Said George Van Horn, a senior industry analyst with the market research firm IBISWorld, “There’s a significant trend, especially for already-established retailers. They have bricks and mortar, they have mail WLA magazine | No. 35 | Winter 2011 / 2012


order, they have a website, and more and more they have self-service solutions as just one more customer-convenient extension of the brand.” By joining the increasing number of product providers that offer self-service formats in today’s retail world, lotteries can connect with both new players and new retail chains. Commenting on self-service retail solutions for the lottery sector, GTECH’s Chief Marketing Officer Connie Laverty O’Connor said, “Even with extremely successful interactive lottery sales platforms, lotteries still generate 90% of their total sales in retail locations.” She continued, “So it is crucial for lotteries to implement solutions at retail that offer this same extra convenience for buying lottery products.”

Self-service goes mainstream Gone are the days when self-service was limited to buying a candy bar or pack of cigarettes from a vending machine. Now that consumers are becoming more comfortable with, and even expecting, control over how they make their purchases, retailers are increasingly providing sophisticated cost-saving self-service solutions. Today, such self-service solutions are employed at airports for ticket purchases and boarding passes and in checkout lanes of grocery stores and major retail chains offering branded specialty items. By all measures, self-service is a retail reality that is growing in strength and prominence across a broad range of business sectors, including: t 4VQFSNBSLFU DIBJOT Tesco, the UK’s

largest supermarket chain, has the highest number of self-checkouts currently installed across its branches, and the company is continuing to be pro-active in investigating self-service solutions. For example, according to Planet Retail, Tesco has been testing a self-checkout-only store in the UK since October 2009. WLA magazine | No. 35 | Winter 2011 / 2012

t %FQBSUNFOU TUPSFT The mid-range US

department store chain J.C. Penney sells Sephora cosmetics from self-service machines inside its stores. Macy’s, the mid to high-range US department store chain, was early to market in May 2008 when it put e-Spot machines in 400 stores to sell items such as iPods, GPS units, and headphones. t 'BTUGPPEPVUMFUTMcDonald’s has plans

to introduce self-service ordering at 7,000 European restaurants to improve efficiency and customer convenience. McDonald’s estimates that using self-service ordering, the average transaction for each of its two million daily customers will be three to four seconds shorter. The new self-service technology will also allow McDonald’s to garner more information about its customers’ ordering habits. A recent consumer survey conducted by market research group NPD for NCR Corporation finds that consumers believe that self-service improves the store experience. Moreover, t 5XP PVU PG UISFF DPOTVNFST TVSWFZFE want self-service options when shopping.

%PFTZPVSMPUUFSZIBWFB retail self-service strategy? While over-the-counter sales of lottery games continue to be essential for encouraging churn play and fostering direct communication about lottery games, self-service solutions for lottery products stimulate sales to new occasional players. More importantly, self-service solutions fit the requirements of retailers that have previously opposed the sale of lottery products in their stores. To date, numerous hard discounters and other retail venues continue to resist selling lottery products. By offering advanced self-service solutions that mirror the consumer-controlled purchase mechanisms in the marketplace today, lotteries may quickly capture new players and increase sales. “As lottery operators know, in order to remain a valued product within the retail world, lotteries must provide similar customer conveniences to maintain and expand the retail / lottery partnership,” asserted GTECH

ITVMS installed in Europe 1000 900

t /FBSMZ IBMG PG TIPQQFST BHFE VOEFS want stores to offer self-checkout.

750

t "QQSPYJNBUFMZ PG DPOTVNFST XBOU stores to offer more self-service options to improve their shopping experience.

500

The survey also asserted that retailers are looking to self-checkout to offer consumers a more convenient experience. Ratifying this observation, Marshal Cohen, chief industry analyst for the NPD Group, said “The option of self-service, when delivered as part of a strategic customer engagement program, can help many retailers cater to today’s timestarved and on-the-go consumers.”

France Italy Switzerland Luxembourg Belgium* Poland*

750

250 160

0

130 20

10

* Pilot Project

35

CORPORATE NEWS C O R P O R ATCORPORATE E NEWS NEWS Vice President of International Marketing, Sharon Duncalf. “The challenge is to create additional in-store sales opportunities and enlist new retail outlets such as discount channel stores.” Meeting the self-service needs of lotteries is additionally complicated by the fact that retail self-service strategies vary tremendously from continent to continent. In the United States, instant ticket vending machines (ITVMs) have long produced supplementary revenue when deployed in venues such as convenience and grocery stores. The US presence of ITVMs dates back more than two decades, and there are now over 47,000 ITVMs in the US. Ongoing innovations, such as online ticket purchases, ensure ITVMs remain a key self-service technology for lotteries in North America. In contrast, ITVMs have a far less visible presence in Europe. At present, there are less than 2,000 ITVMs in Europe, half of them in France. This nuanced picture in Europe suggests that significant opportunities for growth exist in the lottery selfservice market.

Capitalizing on the opportunity “Interest in lottery self-service is already established in France, Italy, Switzerland and Luxembourg, and Belgium and Poland are engaged in assessments of GTECH self-service solutions,” said GTECH Vice President of Product Marketing Paul Riley. Moreover,

Self-service is a valuable way for lotteries to complement their existing retail POS presence.

such solutions are proving their worth. Riley continued, “Of the top six instant per capita lotteries in Europe, five consider self-service a key element of distribution and game access. Nonetheless, the opportunity still exists for most European lotteries to define and execute a self-service strategy.” With the success of self-service in the US now a matter of record, the time is ripe for the wider uptake of self-service technologies. Cultural differences that may have previously delayed the migration toward clerk-free transactions are fading in response to consumer demand across the globe. Explained GTECH’s Duncalf, “By joining the increasing number of product providers that offer self-service formats in today’s retail world,

lotteries can make tremendous strides in connecting with both the missing younger player demographic and new labor-sensitive retail chains.” She continued, “Collaboration between lotteries and retailers provides near labor-free consumer engagement to attract new and occasional lottery players and to build store loyalty for retailers.” Self-service equipment alone, however, will not push sales if prize structures, price points, and payout percentages need to be recalibrated to increase interest in instant gaming. Likewise, the right machine must match the right trade style and local gaming behaviors. For true organic growth of instant products, there must be a comprehensive assessment of the entire instant portfolio in the context of an overarching retail selfservice strategy.

Sita Airport IT Trends Survey 2011 The value of self-service SITA is the world’s leading specialist in air transport communications and IT solutions. SITA’s annual Airport IT Trends Survey, delivered in partnership by Airline Business, the Airports Council International, and SITA, combines the opinions of more than two thirds of the world’s top one hundred airports by revenue to provide detailed insight into the future strategy and expectations of the airport community. The 2011 survey results show top investment priorities for airports lie in improving customer service, with passenger self-service playing a key role in investment strategy. Just over half the airports questioned for the Sita Airport IT Trends Survey 2011 said they will increase the number of passenger check-in kiosks, with a quarter planning to add new features such as the ability to print bag tags and scan travel documents. By 2014, just over one-third of airports aim to have introduced electronic gates for self-boarding and 42% will seek to have e-gates that carry out security checks, such as confirming that a passenger matches their passport. “Customers certainly appear to like it (self-service),” noted the survey report. The report continued, “The objective for retailers is to reduce costs and improve the customer experience.”

36

Judiciously deployed, self-service is a valuable way for lotteries to complement their existing retail POS presence by attracting new players, increasing impulse sales, and solving retailer challenges. In particular, lottery vending machines are a user-friendly and secure way to increase retailer profits per square foot. In sum, self-service solutions have produced positive results for players, lotteries and retailers alike. Their convenience for consumers increases sales and fosters both player satisfaction and store allegiance. With retailers and consumers embracing self-service, lotteries have an opportunity to capitalize on this important trend to expand their player base and ticket purchase frequency.


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© 2011 GTECH Printing Corporation. The trademarks and logos contained in this document are marks owned by or licensed to GTECH Corporation.

CORPORATE NEWS C O R P O R ATCORPORATE E NEWS NEWS Central monitoring systems –

The key to VLT success User-friendly central systems that provide high performance and security enable lotteries to get the most out of their video lottery programs. For more than two decades, video lottery terminals (VLTs) have been a popular and successful way for governments to raise much-needed revenue for good causes, whether to aide an ailing general budget or to provide funding for specific programs such as education. With their tremendous revenue potential, there continue to be new implementations in lotteries around the world. And while the operator, the tax system, and the type and number of VLTs may vary from jurisdiction to jurisdiction, the key to the success of these programs is undoubtedly the central monitoring system. When choosing a central system, it is important that lotteries select a total business solution that will be capable of handling both the immediate and long term needs of the operator. The system must deliver services and equipment that will meet a lottery’s requirements for processing performance, data storage capacity, support, software features and functions, security, and controls.

Technological advancements also trigger ongoing, pervasive and interactive security processes that constantly change with specific customer needs. A VLT monitoring system should be easily adaptable to every security requirement. The system must be structured with a layered security approach that does not constrain the choice of security policies and that is not operationally dependent on technology or vendor-specific security solutions. This means that for every security layer, it must be possible to implement any of the available integrity, control, security and encryption industry standards. Another key component of a successful central system is full redundancy, in order to provide constant system availability and to prevent the loss or corruption of data and the loss of service. In the event of a hardware, network, or software problem or failure, the system must be able to recover with no service disruption and no loss of game processing. Also, the monitoring system should be able to operate uninterrupted for 24 hours a day, seven days a week, and 365 days a year. While expandability, security, and redundancy are critical operating features, it is equally important that the monitoring system be easy to manage. It should be able to manage all functions in real-time through

a simplified, user-friendly interface, so that operating personnel can easily perform all the back-office applications, the necessary management, control and administration functions of gaming processes, and the screening and overview of the entire gaming network.

The iGEM solution As gaming organizations and markets continuously evolve, service providers need the ability to follow-through and handle change on an on-demand basis. INTRALOT has combined the internationally recognized superiority of its systems with its unparalleled knowledge and experience in the local and international arena in the design and deployment of the iGEM VLT monitoring system. The system has all the necessary technical characteristics that safeguard the continuous and successful operation of VLTs, and also enables and encourages future business expandability by its customers. With iGEM, INTRALOT has developed full G2S (Game to System) capability both in large scale destination environments (racinos, casinos and large gaming halls) and retail networks. The company is in the process of simultaneously implementing two very different, but substantial, projects. In Victoria, Australia, the iGEM monitoring

Expandability, security, and redundancy The increasingly competitive business environment and the new conditions that shape various technological and business developments in the gaming market create a series of new demands for the information systems used by gaming operators. An important aspect of these “new generation” demands for flexible gaming information systems stems from each organization’s need for business expandability. That need arises from both the expansion of basic business areas and through growth that leads to additional value-added activities, such as bonusing / loyalty programs, cashless gaming, promotional activities, wide area jackpots, responsible gaming features, and such like. 38

Video lottery terminals (VTLs) are a popular and successful way for governments to raise much-needed revenue for good causes. WLA magazine | No. 35 | Winter 2011 / 2012

CORPORATE NEWS C O R P O R ATCORPORATE E NEWS NEWS system will connect up to 27,500 devices, while in Ohio, the system will connect up to 17,500 devices at racetracks. Both projects comply with standards developed by the Gaming Standards Association. INTRALOT is also positioning itself in the upcoming Greek VLT market by offering its monitoring system and services.

INTRALOT’s iGEM VLT monitoring system has all the necessary technical characteristics that safeguard the continuous and successful operation of VLTs.

The iGEM system’s ability to expand as needed ensures that INTRALOT can deploy a solution that not only handles the way business is conducted today, but which can also keep pace with predictable or unpredictable shifts in the way business will be conducted in the future. For centralized VLT monitoring systems, you need look no further than INTRALOT’s iGEM .

Gaming and home entertainment:

A perfect match Television is transforming from a simple device for viewing overthe-air broadcasts into an all-in-one center for interactive home entertainment. Lotteries, with their secure and regulated operating environments, are well positioned to put this evolving technology to good use. With well established retail networks, lotteries are always in search of new, entertaining products and innovative distribution models, both as a means of engaging with existing players and as a means of attracting new players. Consequently, digital technology has become a mainstay of the strategies of lotteries as they seek to win the hearts and minds of their players by connecting their target audiences with their brands.

for advertising, especially during events of great interest such as football matches. While sports betting has been advertised during football matches and similar events in the past, the ability to bet interactively during such events themselves has largely been missing. Two key questions thus present themselves. Can one offer the passionate foot-


The answer to both questions is a definite yes! With the rapid advance of technology, TV has evolved from a simple, single-purpose box that receives broadcast transmissions into a multi-purpose, interactive device that serves as the locus for all entertainment and information purposes in the home. It provides gaming operators with innumerable ways of servicing their customers and expands the customer’s range of choice endlessly. The key to making this all work is a highly regulated and secure operational environment. It therefore comes as no surprise that lotteries are uniquely positioned to take the lead in utilizing this new interactive environment. Happily, INTRALOT can help them along the way.

As everybody knows, play, and specifically gaming, is deeply engrained in human nature. As such, gaming operators need only find value propositions that match players’ interests in order to achieve success. When acting in concert, business processes and technology produce the very best in innovative gaming and provide new avenues of user access such as interactive television (iTV). Since the 1960s, television has always been the most far-reaching and popular medium

ball fan the immediate possibility of betting from the comfort of his own sofa? And, is it possible to offer such betting through one account integrated across all gaming platforms, including Internet, TV, and mobile devices?

INTRALOT’s Interactive HomeSmartPlay INTRALOT’s Interactive HomeSmartPlay offers the passionate football fans the possibility of betting from the comfort of their sofas.

INTRALOT continues to invest in the development of innovative products and services that assist lotteries in maximizing their growth while ensuring and safeguarding their com39

CORPORATE NEWS C O R P O R ATCORPORATE E NEWS NEWS mitment to responsible gaming and social responsibility. For its significant investments in this area, INTRALOT was included in the 2011 EU Industrial Research and Development Investment Scoreboard.

cation, a shared wallet, and a single depositing system – whether he is registered as a retail, Internet, or mobile player. Their player identity is used across all platforms and provides seamless business continuity for the operator.

Focusing on what it calls the ‘Universal Gaming Experience,’ INTRALOT provides various components that combine to form a flexible and versatile interactive betting and entertainment system that easily adapts to the growing needs and lifestyles of today’s players. The Universal Gaming Experience positions the customer at the center of the system, with all customer interaction points being managed in a single and transparent manner, irrespective of game content and playing medium.

This iTV solution is not limited to betting transactions. Users can quickly and easily perform a variety of other actions in real time, such as checking or recharging their accounts easily and safely. The solution maintains full traceability between channels and the player is able to smoothly interchange between his history, wallet, and betting behavior, while allowing for 24/7 access to the necessary government IT systems.

At the heart of the Universal Gaming Experience is HomeSmartPlay, a family of solutions launched by INTRALOT Interactive. This new suite of solutions gives players access to an extensive sporting catalogue via their remote control, and allows them to engage in betting by way of iTV. For example, viewers of a televised football match can minimize the image of the live event, fixing it in a corner of their TV screen. The rest of the screen can then be used to consult the odds and place bets. There is no longer a need for players to get up and go to their PC, or to have a laptop or tablet always with them. A remote control is all that is needed. Using his unique PIN code, issued when his account is activated, the player is just four digits away from his winning chance.

INTRALOT Italia’s interactive TV: A winning bet In July 2011, INTRALOT Italia, in cooperation with Telecom Italia, signed an agreement that allows players to bet from home via iTV using Cubovision® INTRALOT app, part of INTRALOT’s HomeSmartPlay Solution. Cubovision® is a broadband device that allows access to digital terrestrial channels, Internet content, and an extensive catalog of content on demand. INTRALOT Italia was the first operator in the regulated Italian gaming market to design, develop, and offer betting on a dedicated TV device. To wager, players need to hold an INTRALOT account, which may be activated in a variety of ways – online via the website, through a call-center, or through INTRALOT points of sale. This allows even the less

Internet-savvy player the ability to enjoy the flexibility of betting through his television. The design of the betting system exploited INTRALOT Italia’s branding in order to maintain continuity of user experience with the company’s Internet platform. The graphical presentation of the sports betting product was also customized and optimized for the special requirements of the television environment.

Security and transaction integrity By utilizing the HomeSmartPlay solution, the Cubovision® system ensures high levels of security and transaction integrity, as required by the Italian government. Italy is one of the first highly regulated gaming markets, built around the concessionary model. INTRALOT Italia is certified by the General Informatics Company Sp.A. (Sogai), a wholly owned subsidiary of the Italian Ministry of Economy and Finance. Sogai certifies both physical and online gaming and manages the game schedules on behalf of the Autonomous Administration of State Monopolies, the government body charged with regulating the entire gaming sector. Just as required with online gaming operators, INTRALOT Italia instantly transmits the gaming data placed through Cubovision® INTRALOT app to Sogai in order to be compliant with the applicable legislation. By working in this highly regulated and secure operational environment, Cubovision® INTRALOT app is able to offer players the ultimate in iTV gaming experience.

Enhanced player experience INTRALOT’s Interactive HomeSmartPlay solution provides an exceptional player experience. While browsing, players are continually guided through the steps necessary to place their bets. Players navigate through the user-friendly menu on their TV screen, choosing their preferred sport, championship, or match. The player then adds his chosen bets to his coupon and confirms his choices. All bets are validated only after the player enters his dedicated PIN and his account is authenticated. Players can wager on events from the comfort and convenience of their own living room and experience all the cross-platform mobility and seamless integration that a lottery can offer. The technologies used are fully integrated, offering the player shared login and authenti40

Italian players can now enjoy home betting via Cubovision® INTRALOT app, part of INTRALOT’s HomeSmartPlay solution. WLA magazine | No. 35 | Winter 2011 / 2012


The diverse and extensive game portfolio can be delivered over PC, mobile, and retail channels.

Skilrock’s Weaver: A new breed of innovative gaming solutions for emerging markets With rapid changes in the lifestyle and preferences of players, it is an interesting and challenging time for lottery operators to find and choose the right solution for their immediate and future needs. The needs of the emerging markets and the developing markets differ greatly as do the cultural preferences and the technology in the various global regions. While each market is distinct, there are universal gaming needs that transcend cultural differences. Lottery operators often face the challenge of having to choose the right solution. The reasons for this challenge vary, be it concerns about requiring a whole new platform, worries over integration and migration, and not least with finding the right fit for their markets at the right price. Most of all, however, is the need is to find a solution beyond the proverbial ‘one shoe fits all’.

lottery and gaming operator anywhere in the world. Weaver boasts a modular central platform around which operations and gaming infrastructure are built. Owing to its multi-channel access model, it supports any type of channel operation, supporting B2B and B2C models with ease and flexibility.

Introducing Weaver

An innovative architecture

Inspired by the extraordinary ingenuity of the Indian weaverbird, Skilrock developers have come up with an innovative and practical solution – Weaver, the next generation gaming platform. Weaver is an all-encompassing yet very modular gaming platform that addresses the needs of diverse markets, access channels, and emerging technologies. It practically meets the requirements of any

Weaver introduces gaming operators to a new world of possibilities restricted only by their imagination. Its open architecture is based on a modular design, feature-rich applications, and entertaining gaming content. The use of open technology ensures optimum total cost of ownership and

42

ensures that Weaver can operate in tandem with any other solution that may be in place, providing a path for smooth migration.

The innovative modular architecture meets any operator’s requirements. WLA magazine | No. 35 | Winter 2011 / 2012

CORPORATE NEWS C O R P O R ATCORPORATE E NEWS NEWS Key functionalities The features and functionality supported by the gaming platform are critical and important components that influence an operator’s overall strategy. The key functionalities of Weaver include: t *OUFSBDUJWFDIBOOFMT.PCJMF *OUFSOFU Internet protocol TV (IPTV). t 3FUBJMFS DIBOOFMT *OUFHSBUFE 104 IBOE held terminal, PC POS, kiosks, self service terminals. t "SBOHFPGQMVHJOHBNFT%SBXHBNFT Scratch off cards, Instant win (online scratch), Instant bingo / lotto. t $PNNFSDJBMTFSWJDFT.PCJMFUPQVQ FMFDtronic voucher distribution, bill payment, micro banking / finance services. t &YUFOTJWFCBDLPďDFGVODUJPOT POMJOFBOE offline reporting suits. t &BTFPGJOUFHSBUJPOXJUIUIJSEQBSUZQSPEucts, platforms and contents.

Interactive Gaming Interactive channels for lottery are shifting towards the ‘fun’ element for the player. Weaver’s interactive gaming module (IGS) has been designed for mobile platforms, PC, and IPTV. It provides seamless features on all the devices achieving a unified player experience. IGS comes with a state-of-the-art player management system that enables a custom izable player registration process. The player management system provides identity ver i fication as per the various reg u latory requirements. Player seg mentation and profiling, and responsible gaming controls, are important features from a risk management perspective. The player management system also provides single e-wallet, banking, and epayment integrations. Key marketing features for interactive operators are also offered. Such features include support for setting up a wide range of promotion and loyalty schemes, marketing campaigns, banner management,

BďMJBUFNBOBHFNFOUBOEUSBDLJOH BTFBSDI FOHJOF PQUJNJ[BUJPO 4&0 GSJFOEMZ QPSUBM design, and content management.

Empowering emerging economies With extensive experience gained in various states throughout India, Skilrock’s capability UPPČFSBQQSPQSJBUFTPMVUJPOTGPSUIF"GSJDBO market has been well demonstrated across various countries within the past three years. Skilrock addresses the following unique requirements of lotteries in emerging market countries: t ćFOFFEGPSFYUSFNFMZMPXDPTUCVUSPCVTU The deployment of Weaver in Africa. POS terminals. t ćFBCJMJUZUPPQFSBUFXJUIPVUBQVCMJD cycle is very long and expensive for instant power source for extended duration. t "VTFSGSJFOEMZJOUFSGBDFXJUIBTIPSUUSBJO games, which often leads to high operational costs for the operators. Skilrock has come ing time. up with a solution called Scratch Weaver t (BNFTUIBUSFMBUFUPUIFMPDBMQPQVMBDF t ćFBCJMJUZUPPQFSBUFFOUJSFMZPČBWBJMBCMF (patent filed) to cut down the time and costs of introducing new scratch games. It offers communications media that may exhibit extensive automation to game designers and uptime and congestion problems. t *OOPWBUJWFQBZNFOUDIBOOFMTBOESFUBJMFS developers of physical scratch cards, instant channel management modules based on win, online scratch games, instant lotto/bingo games, and the like. The solution works ‘cash’ transactions. for physical, PC, or mobile platforms.

A solid gaming package Gaming content is a critical factor for the successful lottery operator, especially where interactive operations are involved. Skilrock has a large suite of games and innovative game designing tools that not only integrate with the Weaver platform but also with existing platforms. Skilrock’s gaming package includes: Scratch Weaver: The typical game designing

Skill-based lottery games: Introducing an element of skill into a game is a means of increasing player entertainment and involvement. Such games have found wide acceptance by lottery regulators. Social media: Social media platforms, such

as Facebook, have become integrated in dayto-day life and have created many new business avenues. Likewise, social gaming can CF B NFBOT PG JODSFBTJOH HBNJOH USBďD PO your platform.

Skilrock’s Credentials · · · · · · ·

RNG certification from iTech Labs CMMi Level 3 by KPMG ISMS certified UK GC certified Over 25,000 POS in operations SEZ approved Development Center Several patents filed with WPTO.

For further information: www.skilrock.com, [email protected] Skilrock's social gaming platform.


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LEARNING L E A R N I N G CCURVE U RV E WLA Academy – Retail markets seminar:

“Time to get back to basics!” 1. Study your players’ behavior and find soft insights. Hard data alone will never get you anywhere.

16–18 November 2011

Seminar in cooperation with the European Lottery Association Hosted by the National Lottery Ireland Dublin, Ireland

The CEO of the National Lottery Ireland, Dermot Griffin, welcomed more than 90 delegates from 29 countries and five continents to a two-day seminar in cozy Dublin.

In his welcoming speech, Mr. Griffin said that the time has come for lotteries to re-focus on best practice lottery retailing. Everyone knows by now about growth and development across digital channels and social media. However, for most lotteries, traditional retail sales are still the key to success. Mr. Griffin described how the Irish Lottery put strong emphasis on visiting their 3,800 retailers. According to him, lotteries need to get on the road to meet their retailers, so that they can speak to them directly about how to best create a fruitful, mutually beneficial partnership.

44

And developments in lottery retail have been impressive over the past decade. Inlane selling, rebranding of the shop, creation of separate selling areas, digital signage in shops, partnership deals, retailer audit, and instant ticket vending machines were all among the topics presented and discussed during the seminar. The program featured a superb blend of external retail managers from Spar, SuperValu, and Topaz, among others, together with lottery experts and WLA contributors from different countries, all sharing their best practices.

2. Look at other areas for excellence and new ideas, not just to businesses but also to, for example, sports or family life. For example, Mr. Taylor recounted British Airways’ search for better ways to get their passengers to sleep comfortably on cross-Atlantic flights. Instead of looking at the best flight chair design, British Airways examined the market for luxury yachts, which business faces the same challenge as airlines—namely, how to get people to sleep comfortably in limited space.

3. Define what you think are player benefits and describe why. Use a maximum of nine words! British Airways once defined their benefits as “Arrive ready for business” and the why with “More sleep. Less hassle. Refreshment.” Note that there is nothing in either of these slogans about the product itself. Player benefits are not equal to a list of games, no matter how great you may find them. Keynote speaker Hamish Taylor has impressive background experience with large corporations like Procter & Gamble, British Airways, Eurostar, and the United Kingdom’s Sainsbury’s Bank. He presented some great insights into understanding consumer behavior, and spiced up his general principles with plenty of practical examples. He summarized his keynote speech in four messages:


LEARNING L E A R N I N G CCURVE U RV E Tentative schedule for all regional and interregional lottery events for 2012 Date

Topic

Organizer

Venue / Host

Marketing seminar: “Staying on top of the game”

EL / WLA

EL London, UK

Creativity and game design forum (Lottery games and services)

EL

EL Paris, France

17–19

Workshop for non-EU members

EL

Azerlotereya SJSC Baku, Azerbaijan

TBD

State lotteries, responsible gaming and corporate social responsibility: The benefits of this association

CIBELAE

TBD Mexico

25–27

EL management

EL

Loterie Romande Lausanne, Switzerland

2–4

Industry days

EL / Partners

De Lotto Amsterdam, Netherlands

4

EL general assembly (members only)

EL

EL Amsterdam, Netherlands

8–10

Sports betting seminar

EL / WLA

C.N. Loteria Romana S.A. Bucharest, Romania

21–25

NASPL lottery leadership

NASPL

TBD Grand Rapids, Michigan, USA

29–30

Security seminar

EL / WLA

MSL Kiev, Ukraine

6–8

European legal affairs seminar

EL

Hvratska Lutrija d.o.o. Croatia

11–14

Spring directors meeting

NASPL

Atlanta, Georgia, USA

16–19

Professional development seminar

NASPL

TBD Orlando, Florida, USA

TBD

New products: Trends, channels, and modern marketing

CIBELAE

TBD Dominican Republic

2–7

European Lotteries University (ELU)

EL

Lottomatica S.p.A Italy

9–12

World Lottery Summit 2012

WLA / NASPL

Loto-Quebec Montreal, Canada

30–October 2

Responsible gaming seminar

EL

TBD TBD

TBD

Internet and new technologies seminar

EL / WLA

AB Svenska Spel Sweden

12

PR / Communications workshop

EL

TBD TBD

TBD

Information security as applied to the integral processes of lotteries

CIBELAE

TBD Argentina

APLA ‘12 convention

APLA

Tatts Sydney

European legal affairs briefing

EL

EL Brussels, Belgium

January 25–27 March 13–15 April

4. Communicate your customer promise effectively and make it easy for your staff to deliver. Ascertain the feelings you wish to create, construct a single sentence that clearly communicates your promise, and stick to it!

May

June

Mr. Taylor’s presentation, together with the presentations of all the other speakers at the seminar, are available from the member area of the WLA website. The WLA would like to thank Dermot Griffin and the Irish National Lottery for all of their work in planning the seminar and for having created a comfortable and fruitful atmosphere both for learning and for networking.

July

September

October

November TBD December TBD

TBD = to be determined


45

OUR CONTRIBUTORS O U R C O N TOUR R I B U TO R SCONTRIBUTORS Many thanks to our PLATINUM Contributors

Many thanks to our SILVER Contributors WLA MAGAZINE is published by: The World Lottery Association Lange Gasse 20 P.O. Box CH-4002 Basel, Switzerland www.world-lotteries.org

- the best bet

46

Publication Director: Jean Jorgensen, WLA Executive Director Editor: Paul Peinado, WLA Communications Coordinator Contributing Editors: Matthew Spinks, Assistant Communications Coordinator; Patricia McQueen; and Göran Wessberg Print: Werner Druck AG, Basel, Switzerland Layout: 3satz GmbH, Thalwil, Switzerland


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