The COVID-19 disruption not only brought significant changes to our everyday lives and the way we do business, but to our consumers’ behavior as well. In order to swiftly respond to these changes, Alchemy3 optimized many of their existing products with their Go Out and Play umbrella campaign. Designed to help lotteries understand how relevant branded solutions fit consumers’ evolving needs, Go Out and Play programs better serve lottery players with the prizes, brands, and channels of engagement that are now a part of their “new normal.”
Now more than ever before, lotteries need to leverage programs featuring products consumers are purchasing today and are likely to continue buying in the future as we return to our “new normal.”
“Our products/programs are more relevant than ever—but there is a need to refocus our messaging to consumers,” said Alchemy3 CEO Paul Guziel. “We took a look at each of our brands and assessed how they were being used in this new world of COVID.”
The idea for Go Out and Play was born via virtual meetings during the shutdown as Alchemy3 staff brainstormed new ways the company could better serve its clients. Market data identified brands in big demand during the shutdown, such as Home Depot.
“The Home Depot has always been popular but this spring/summer, sales skyrocketed for stay-at home products such as backyard/patio and landscaping goods. With that, we created products that awarded prizes that are most relevant for now and in the near future,” added Guziel.
Change in Positioning
But home improvement and landscaping were just the tip of the iceberg. Desperate for entertainment, consumers were streaming movies and bingeing on popular long-running TV shows. Products and services which entertain would be prizeworthy. It all comes down to how the program is presented to the consumer.
“Lotteries will continue to offer branded games and programs, but the positioning might change. Brand owners have to adapt as well and when our partners do, we can take their lead to reinvent the promotions for our clients,” said Alchemy3 President Jeff Schweig. “As an example, we know that at-home movie viewing increased significantly as state/provincial governments encouraged stay-at-home precautionary measures. So, for our Fandango rewards games, some lotteries have opted to offer a movie night at home” program and award FandangoNow prizing in lieu of in-theatre movie tickets. The prize is still very desirable, but the way consumers choose to redeem it has changed.”
Ultimately, the brands included in the Go Out and Play solutions program included outdoor products (Cabela’s and Bass Pro Shops), entertainment products (Fandango), home & garden (Home Depot), online shopping sprees (Tango Card), automobile travel (Honda), family games (Corn Hole, Skee-Ball and Pop-A-Shot) and barbecue/grilling (Grills Gone Wild).
“We chose brands that are generally popular with consumers but have remained relevant to players as we adjust to our new normal,” said Schweig.
The reality is that lotteries need to show their customers that they understand how we are now living our daily lives and offer products that consumers are buying. “This goes way beyond the pandemic,” asserted Ben Nicolls, Director of Marketing & Sales, Alchemy3. “It is critical that we as lottery marketers consistently evaluate and assess the wants/needs of players. As consumer purchasing patterns change, we need to adjust our offerings and channels of distribution.”
There is also an opportunity for lotteries to incorporate a Go Out and Play solution across multiple channels, such as Instant, Keno, Fast Play and iLottery. It would not be difficult to imagine a brand like Fandango offering instant use streaming credits as a second-chance prize for a draw game promotion as well as iLottery.
Still Schweig warns that “the strategy could be different for those lottery products that are offered in store—at essential retailers—vs. non-essential retailers. Also, there are some brands/programs that lend themselves better to a brick and mortar or iLottery execution.”
Alchemy3 can envision where a lottery would create a quarterly program that could change by season. “An ideal execution of Go Out and Play would be a recurring product offering. If a lottery has a quarterly promotion plan, this approach could be successful as the brands can have seasonal appeal. We do know that traditionally movie studio releases are stronger in summer and winter, while outdoor activities are strong in summer and fall. Plus, with the offerings of these brands, there are ways to make them work off-season. There is versatility to make a year-long plan work as players are focusing on staying safe,” said Guziel.
Need to Pivot
With experiential events not feasible for six to 12 months, along with travel on cruises or airlines not currently popular due to spread of COVID-19 during the summer months, it is important for lotteries to pivot by offering prizes that players want to win, not only right now, but also when they are ready to Go Out and Play.
“This is not the time for lotteries to run big event type programs as consumers are apprehensive to gather in groups. Moreover, as an industry, we must be sensitive to the messages we convey to the public. We do not want the media to misinterpret our intentions as they oftentimes do. As an industry, we need to continue to offer these types of prizes but also provide winners with maximum flexibility in their travel,” said Schweig. “Take our MGM RESORTS properties for example. There are many people who are still traveling to Las Vegas but others who are hesitant to do so. For Go Out and Play, consumers can decide when it will be the right time to redeem their prize.”
The biggest challenge the pandemic created for lottery marketers in fiscal 2021 is reaching consumers.
“Lotteries must continue to try to expand channels of distribution—and have a stronger presence in essential retail establishments,” said Guziel. “Continued efforts for lotteries to offer iLottery wagering will of course provide additional growth in the industry. Availability and safe purchasing options are critical for maintaining pre-pandemic sales. Fortunately, most lottery sales are at essential retailers, so the opportunity is there. The challenge comes with reminding the consumer that lottery remains a casual entertainment option, as some of the other entertainment options have become temporarily unavailable.”
How the lottery industry will change because of the tumult and risk of a second wave is difficult to predict.
“It’s very much a wait and see,” acknowledged Schweig. “While typically, lottery sales stay strong during a recession, this situation is unprecedented. We need to continuously assess playing patterns/behaviors and trends and adjust our marketing and sales strategies accordingly.”
Clearly the change in consumer’s behavior, as well as the way lotteries do business in our uncertain “pandemic” universe, will precipitate change.
“With state and local government’s demand for additional resources/funding, we are hopeful that legislators will be more amenable to allowing additional ways for lottery wagering,” said Guziel. “This will allow lotteries to provide a greater return to our beneficiaries. In addition to more lotteries offering internet play (iLottery), the sheltered behavior of the consumer will force a change in traditional lottery game play as well. Lottery providers need to consider optional delivery methods, touchless self-service options and additional features in their mobile apps to remove steps from the purchase process.”
Go Out And Play Solutions
Each Go Out and Play solution was chosen for its relevance and flexibility. Featuring prizing players can enjoy both indoors and out-of-doors, these solutions provide great options for a lottery’s next scratch program or draw game promotion.
- $1,000,000 Movie Nite at Home: Home entertainment is now a major spend for U.S. consumers. Fandango streams over 50,000 movies and TV shows directly to consumers’ homes with movie theatre options for the future.
- $1,000,000 Home & Garden Makeover (The Home Depot): While consumer spending has slowed in many categories, the same cannot be said for the home and garden sector. With staycations more likely than vacations in the near future, expect this trend to continue.
- Online Shopping Spree (Tango Card): The rise of online shopping over the past few months is impossible to ignore. Offer your players electronic gift cards from over 200 merchants instantly redeemable online or at retail.
- Cabela’s $100,000 Cash Adventure: As everyone looks forward to getting back out, consumer interest and spend continues to growth with brands that offer prizes for both the backyard and the great outdoors.
- Corn Hole: The quintessential family game that effortlessly transitions from the backyard to larger social events.
- Grills Gone Wild: Cooking at home has become a major trend. Partner with an innovator in home food delivery and a brand that works equally as well at home or out at sporting events.
- Honda Ultimate Garage Giveaway: Whether it be close to home or far away vacation destinations, Honda offers a wide variety of vehicles designed to drive your players to adventure!
- StubHub $100,000 Big Ticket Out: Be ready when your players are with a big ticket out to great live experiences including sports, concerts, theatre and comedy.