Study Helps Lotteries Improve Marketing

Special Report - April 14, 2009
Lottery sales could potentially increase by 127 percent nationwide, if states would implement a number of consumer marketing tactics, including putting the games online and increasing public awareness about the government programs the lottery helps fund, according to a new study released last week. The 32-page study, “U.S. Lotteries: Achieving Strong Results in a Weak Economy,” was conducted by Frost & Sullivan. According to the study, “lottery sales can increase when the same tactics used in consumer marketing and consumer business are applied to lotteries.”

After interviewing lottery directors and analyzing lottery sales and marketing practices nationwide, the study’s authors developed a list of lottery “best practices,” which they claim could help states increase lottery sales. One of the best practices is for lotteries to attract a “broader customer base,” which includes taking the game online. “Although they are owned and operated by states,” the study points out, “lotteries are a consumer product and they should be treated as such, mirroring the same marketing and advertising techniques, as well as aligning with consumer trends, such as frequent Internet use.”

The study argues that people should be able to play the lottery online, despite the fact that Internet gambling is currently illegal in the United States. It cites surveys that show that most lottery players would like to be able to play the game online and notes that Internet gambling is legal in other countries. It also argues that lotteries could “aid in the regulation of Internet gaming” and “leverage their trusted brand name to help consumers feel at ease about participating in online gaming.”

In addition to putting the lottery on the Internet, the study contends that states need to focus on advertising that promotes the “good causes” the lottery funds, such as education. “When the success of a lottery is tied to the positive results it can provide for a specific initiative, such as education, the public know where their dollars are going and are likely to support legislation around it,” the study states. As an example, it cites the 2004-2005 Massachusetts Lottery advertising campaign, which had the theme “We All Win,” and “focused on explaining exactly what the lottery dollars helped improve the previous year.” Also according to the study, states should advertise the lottery on the Internet.

Other tactics recommended by the study include creating new games, “maximizing exposure” to the lottery through “Big Box stores,” race tracks, and airports, and using “holistic” marketing and advertising. According to the findings, implementing all of these tactics could increase lottery sales by 127 percent nationally, and potentially contribute an additional $14.1 billion to state economies. In North Carolina, the study claims that these tactics could potentially increase sales here by 157 percent and contribute an additional $553 million to the state budget.

“Internet gambling is currently illegal in the United States and for good reason,” said Bill Brooks, president of the North Carolina Family Policy Council. “Online gambling is more addictive than other forms because it is more easily accessible. In fact, studies have shown that the prevalence of gambling disorders is directly related to the availability of gambling. Putting the lottery online would only increase the number of gambling addicts in this country, and the negative social costs associated with it, including family disruption. The gambling industry is only interested in increasing its bottom line, regardless of the costs to individuals, families and society, and that’s what this study is all about.”

Copyright © 2009. North Carolina Family Policy Council. All rights reserved.