Lotteries are aggressively testing non-traditional providers of media to help reach a wider audience. Among the trending channels are podcasts, out-of-home (OHH) digital buys, and in-store video ads.
In just five years, the percentage of U.S. lotteries’ advertising budget devoted to digital (Internet) increased from 8% in FY16 to 17% in FY21, according to LaFleur’s 2021 World Lottery Almanac.
At La Fleur’s 2021 Austin Conference, Amber Seale, Deputy Secretary of Marketing at the Florida Lottery, discussed how the $9 billion agency seeks to be innovative and forward thinking.
“Faced with the challenges the pandemic brought, we identified ways in social media to stay engaged with our players and beneficiaries by launching custom AR filters, as well as providing engaging and exciting livestreams. More recently, we brought in a Tic Toc influencer to host a Facebook Premier series. We continue to seek new opportunities from In-Store POP media, as it gets us one step closer to the point of purchase. Buying media via displays, like Gas Station TV and In-Store Digital Screens that are located at checkout, deliver the strongest ROI for the Lottery across all media channels,” said Seale.
The Virginia Lottery analyzed the time spent consuming media which shifted drastically during the spring 2020 pandemic lockdown. It identified the top 3 fastest growing content providers were streaming services, social media and games. This resulted in the lottery increasing its spend for digital/social/OTT to 53% for the 2020 Keno campaign launch. In contrast, the lottery dedicated 18% to this channel for its 2019 Rolling Jackpot campaign.
“In January 2022, we are launching a new product, Cash Pop, which has been popular in other states with a younger demographic. As such, our media is placed in very non-traditional providers. We have leveraged our former successes streaming, podcasts, social, and influencers to reach this important audience,” said Terri Rose, Director of Marketing, Virginia Lottery.
The Pennsylvania Lottery will celebrate the agency’s 50th anniversary in March 2022. The lottery is launching a brand campaign entitled “Lottery Love.” The programmatic digital OHH buy will reach 3,500 screens across Pennsylvania. Their ad agency is buying the package.
“Our OHH marketing to support ‘Lottery Love’ includes permanent and digital OOH boards. Our programmatic Digital OOH plans are to intercept players in relevant environments such as bars, casual dining, salons, gyms, ride shares,” said Kelly Cortez, Director of Marketing, Pennsylvania Lottery.
According to Teri Wood, VP, Sales & Marketing, “the Iowa Lottery has always embraced non-traditional forms of advertising such as QR codes, geo-targeting, digital online, web page pixel placement, device IDs, Snapchat and influencer promotional partnerships.”
In April 2021, the Iowa Lottery partnered with the Kwik Star convenience store chain in a co-branded promotion focusing on its “Kwik Rewards” customer-loyalty program. Members simply entered Iowa Lottery tickets in this exclusive promotion for a chance to win a $1,000 Kwik Star gift card.
“The lottery is actively working on multiple retailer and/or retailer-sponsor prize or experience in FY22. We have also aligned with our vendors to create unique and engaging digital cooperative/cross-promotional sponsorships through our loyalty club. By leveraging their brand(s) in cooperation with our own, we can extend our reach, acquire new loyalty club members, engage existing members and collect valuable and informational data to better target them,” said Wood.
The Arizona Lottery began developing its “retail advertising bucket” in FY19. It started out with a $250,000 budget but expanded to $500,000. “When a player comes up to buy a ticket, we hit them with a message. It might not necessarily be on our terminals. We do it on the floor of a grocery store or ad on a cart or even video screens above the soda fountain. The primary activations are video screens,” said Chris Rogers, Deputy Director, Products & Marketing, Arizona Lottery.
The Florida Lottery now buys advertising space in-store at its retail partners as well as uses its own assets at retail. The top 3 U.S. outlets selling lottery tickets are gas convenience stores, convenience stores and grocery stores.
“We added a fair bit to our POP, in-store media. So, in addition to our POS that we place for free at most of our retailers, some stores offer purchased media placements. We had previously seen success with Gas Station TV but buying media via displays and audio in-store gets us one step closer to the point of purchase,” said Seale.
The Virginia Lottery has also tested purchasing in-store media. “Last year, we worked with Walmart for a pilot for in-store advertising and it did increase sales. Though Walmart has temporarily suspended this program, we look forward to its return and others like it in the future,” said Rose.
Gas Pump Ads
In the U.S., gas convenience stores represent 40.2% of the total U.S. lottery agent network. They are ranked #1. So it is hardly a surprise that lotteries want to reach consumers at the pump. “We are a big proponent of gas pump advertising. The proximity to the convenience store and our products provides a great opportunity for us to communicate with our players through the day,” said Rose.
While U.S. employees have yet to return full-time to the office (45% still working at home in autumn 2021 according to a Gallup poll), they are still consuming podcasts. (Note: The backup on the home stairs to get past the kids and pets can be a nightmare for the home commuter.)
The Virginia Lottery is a big advocate for this non-traditional buy. “Podcasts have become exponentially more popular over the past few years and that provides an incredible opportunity to reach Virginia Lottery players,” said Rose. “Our media buying agency, NDP, worked closely with Pandora to develop a pilot exclusively with the Virginia Lottery to test advanced contextual targeting through podcast content. The program was very successful and Pandora will offer that to additional advertisers in the future.”
The Pennsylvania Lottery uses podcasts to advertise scratcher games. “We are using the podcast readers—pre-roll, post-roll, and mid-roll. The post-roll is the call to action. We want to see how the performance goes. We are working with iHeart (2.5 million impressions). It began over a year ago. We are pretty pleased,” said Cortez.
The lottery typically purchases a broad variety, such sports and how-to-improve-your-life podcasts. “We don’t want to be on anything political or which appeals to children,” she added.
The Florida Lottery does not advertise on podcasts. “Our desire is to reach every Floridian over age of 18. So when we start to get into content and super niche, it contradicts our marketing strategy,” said Seale.
U.S. lotteries vary widely on whether they purchased multi-year contracts for billboards or purchase space only for jackpot alerts.
“We are only activating our billboards at specific jackpot thresholds,” said Arizona’s Rogers. “We do it digitally. We have no fixed positions.”
The Pennsylvania Lottery does a combination of both—long-term contracts and non-fixed positions. “We rotate our message—responsible gaming, jackpot alert, in-state lotto jackpots, and Play Your Way campaign. We have flexibility,” said Cortez.
The Florida Lottery books long term contracts (three to five years) for digital and static billboards. “We have a large number of dual jackpots around the state. We have a ton of digital billboards that run in cities. When we receive the notice from MUSL, our ad agency and our vendor get that notice. We have a pretty good system,” said Seale.
Paid Social Advertising
Traditional advertising channels (TV, radio and print) still represent over one-third of U.S. lotteries’ total ad budget in FY21, according to La Fleur’s 2021 World Lottery Almanac. But lottery marketers are scrambling to be seen where eyes are glued, such as social media.
“We really pushed the envelope with social—at the end of last fiscal year we (as all lotteries) were faced with how to stay engaged with our players and beneficiaries with limited access. For our beneficiaries we created an AR filter for graduates—this ran via paid social media but was also picked up by many of our community partners and college/university partners as a branding moment. Once we began to get back to ‘normal’ we were able to continue the success of livestreams, but also built in more gamification and leveraged some new Instagram opportunities, allowing us to build more episodic content. We did some really cool stuff for Week for Life using a Tic Toc influencer!” explained Seale.
Lottery marketers stressed the importance of staying on trend with how consumers are connecting to media. They are tethered to their mobile phone and tablets for entertainment, exercise, education and more.
Wood sees major possibilities for virtual lottery prizing and experiences. “In the future we will be undergoing a digital transformation which will allow us to advance our marketing technology to create unique digital experiences. We will soon be able to collect anonymized aggregated data points across multiple platforms. We can then use that data to run segmented marketing campaigns to acquire new and strengthen existing loyalty club memberships while exceeding their expectations and growing our revenue,” she said.
Rose is a big advocate of utilizing video assets across multiple devices and increasing presence in online and in-app advertising.
“We continually monitor our players’ consumption of media throughout their day. For example, we had expanded our digital spend before the pandemic, but habits changed dramatically throughout the course of the last few years, and it has been incredibly valuable to closely monitor and reconsider our partnerships more frequently,” said Rose.