30 PUBLIC GAMING INTERNATIONAL • MARCH/APRIL 2022 now regulating sports betting – or have legislation to allow betting on their books or waiting to be passed. Watch this space to see how this very special market develops. SALES TO GGR Another interesting change during the period might be glossed over as a simple accounting matter. But underneath it lies a significant development. There has been a move to reporting ticket sales figures in GGR (Gross Gaming Revenue) rather than straight Sales figures. This change is a practical response to the changing product mix of lottery games. The more extreme representation of this would be when Veikkaus merged with ray (the Finish Slot-machine Association) and Fintoto (horse racing) in Finland in 2017. How could you possibly add together the sales from these three companies? It also reflects the general upward drift in % prize return to players and the move to integrate slot-type games with very high pay-out games. Of course, given the higher margins of traditional lottery, GGR also more accurately reflects the immense difference between lottery and all other games-ofchance sectors when it comes to net financial benefits to society or good causes. Interestingly, in a related development, those administrations offering licences or private management contracts to third party operators are gradually changing to using percentage of GGR rather than Sales as a payment basis. CSR-RG Speaking of higher prize payouts and faster games bring us neatly from GGR to RG (and CSR) Responsible Gaming EL and WLA Certification started in 2008 and we now have almost 50 certified lotteries in Europe and over 100 in WLA. During this period, Lotteries began to realise that there was a business case to be made from Responsible Gaming. The recent introduction of mandatory certification for all EL Members by 2022 is a sign of commitment to the certification system. MOVE TO ONLINE The trend of a move from retail to online over the 20 years hardly needs reporting. In 2002 there was very little online business being done by lotteries. Now there are some lotteries where more than 50% of their business is online and, during the pandemic, there has clearly been a shift to online from the retail channel. According to recent data from IBM’s U.S. Retail Index, the pandemic has accelerated the shift away from general physical stores to digital shopping by roughly five years for what would have previously been one year’s migration. This leaves the difficult task of forecasting the behaviour of the Covid recruits to online gaming as things return to “normal”. Will they behave as regular online newbies in the rate at which they gradually tire of the new channel and revert to their old ways of playing? Time alone will tell. But one thing is sure … online playing will continue on its inexorable growth path. RETAIL Retail has undergone serious change in the 20 years. It has moved from traditional to e-commerce to MultiChannel to OmniChannel. I am not personally comfortable with this latter term. I have difficulty with the term OmniChannel as I do not believe Lottery at retail is the same as a Macys or a Zara. We do not have showrooming of lottery products … to try them out …and we do not need to have the ability to return purchases to different purchase points. But we do have a development where a player could “buy” tickets at retail and “play” them later online. We also have the possibility of extended play by allowing play to happen either online or in retail outlets. I am happier with the term digitization of retail, or “phygital” … a term FdJ has adopted to describe their developments in this space. I believe this model more accurately represents how the player journey should be enriched and managed in the new retail space. Contactless payments and other innovations introduced by necessity during the pandemic will continue to offer an enhanced service to players at retail. In-lane selling is beginning to have traction, with even the German discounters beginning to accept lottery at the tills. The From Retail (Line) to Online In 2020 EL Members generated online GGR of €3.6 billion, representing 12% of total GGR in 2020 and a 25% year-on-year increase.
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