16 PUBLIC GAMING INTERNATIONAL • NOVEMBER/DECEMBER 2022 retailer recruitment and support functions. And that was the first Shared Risk program. During the first stage of this program, the New York Lottery’s instant game sales grew from $57 million to almost $500 million in an eight-year period. The instants category was producing about $225 million of profit for the New York Lottery. I look at this successful collaboration between the New York Lottery and Scientific Games as formative for us, shaping our instant game management approach in the Scientific Games Enhanced Partnership and our culture in ways that continue today. R. Paul: Lorne, when you took the reins at Scientific Games in 2002, Shared-Risk had evolved into Cooperative Services and became a big part of the portfolio. How did you make it better? What would you do differently? L.Weil: At that point, it was evolving incrementally. The foundation had been laid. The method of working hand-in-glove with the lottery was running smoothly. I encouraged the teams to continue to evolve it, to enhance the effectiveness and productivity of what was being done, and to find new and better ways to nurture collaboration. Jim Kennedy always had his five-most-important-things we needed to do or improve upon. It was a matter of identifying those things and executing the plans to make them happen. One top-of-mind initiative, for instance, was to steadily increase the price-points of the games. Of course, objectives like this need to be developed in collaboration with the lottery. And what may seem to be obvious to us years later, like that increasing price-points is a predictable way to increase revenues and profits, is rarely so obvious in the beginning. We may propose strategies and initiatives, but it is up to the lottery to decide how, or even whether, we proceed. As you point out, Rebecca, the relationship depends on trust and mutual support. The technology partner needs to earn the trust of the client, the lottery. The lottery does expect us to provide the data and evidence to support our recommendations; and then to test new ideas before investing resources. Over time, we learn to pool our brain-trusts and work together to produce the outcomes that are best for all lottery stakeholders. R. Paul: And you bought MDI a couple years later, in 2005? L. Weil: We wanted ways to add value to the product to justify the increase in price. Licensed properties became a very effective tool to do that. Branding lottery products with their favorite sports team, or cartoon character, or popular consumer brand, added that value, attracting players to pay a little more to play the games that captured their imagination. While what we did was not revolutionary, I would say it could not have been done without the mutual respect and trust we constantly worked hard to earn from the lottery leadership of Georgia, where Rebecca was CEO, and progressive lotteries like Florida, Pennsylvania and others to lead the way. R. Paul: Over to you, Jay. We have been discussing some of the growth-drivers for the instants products category. What can we do to increase the growth of the drawbased games category? Jay Gendron: Enabling both Mega Millions and Powerball to be sold in all states was a big step. Increasing the price of the Powerball ticket to $2 was another big boost to the sales of draw-based games. The next step may be to continue the price-point evolution just as was done in the instants product space. For example, we know that the Mega Millions group has been exploring the option of increasing the price to $5. Based on historical precedent and market research, we believe that gaining consensus and approval on a $5 game would further increase sales and revenue in the draw game category. It would have the added benefit of further differentiating the two big national games. I do think it benefits all of us if we have Powerball and Mega Millions complement each other. But this is another case where lotteries have to work with each other and work with vendors in a spirit of trust to implement strategies where the outcome is not certain. We can trot out the data, the facts, and evidence to support a proposition that increasing the price will increase sales and transfers to lottery beneficiaries. But in the end, we need to trust that we are all pulling in the same direction and have each other’s interests at heart. Keno and CashPop have also been very successful in the jurisdictions where they are implemented. So there is a lot of potential for more product expansion, differentiation, and optimization to drive incremental increases in sales and, ultimately, revenue for lottery beneficiaries. R. Paul: Jennifer, what do you think makes a good partnership? Jennifer Westbury: At Pollard Banknote, we take an expansive view towards partnerships and how they can be nurtured and developed to drive performance and results. Each lottery has its own unique sets of sales and marketing agendas, political and regulatory environments, organizational structures and cultures, and overall business objectives. We think creatively when designing an approach that optimizes the ability of all the component parts of the relationship to work together effectively. We have lots of different kinds of partnerships, and in the end, each one is special in its own way. Sitting next to me is Matt Strawn. Our partnership with the Iowa Lottery goes back to when we first started printing instant games in Iowa. Two major production facilities in the state of Iowa create significant employment for Iowans. Our partnership with the Iowa Lottery is considerably different from the partnership we have with the Texas Lottery where Gary (Grief ) and Ryan (Mindell) have long espoused a philosophy of working with multiple vendors. Their latest RFP is a great example of how lotteries are thinking outof-the-box and challenging their partners to create new kinds of solutions and partnership models. And Gregg Edgar in Arizona has a different view of what he wants the partnership with Pollard Banknote to accomplish. We not only provide instant tickets, Pollard Banknote provides the Arizona Lottery’s Players Club player engagement solution. We implemented warehousing and distribution three years ago and managed the process with performance improvements through the disruptions of COVID. And of course, in addition to the longstanding instant ticket work and the manufacturing facility we operate in Michigan, we partnered with the Michigan Lottery on their journey in digital, beginning with some Space Between products like their Crossword apps, through to the launch of iLottery. What started as a partnership based on technology, products, and marketing evolved into assisting with governmental and regulatory affairs. Pollard Banknote then participated with the New Hampshire Lottery in challenging the U.S. Department of Justice to clarify its position on iLottery. The US DoJ proceeded to overturn their unfavorable ruling to acknowledge that authority to decide regulatory policy relating to online gambling and iLottery resides with the states, just as it always had with traditional casino gambling and lottery. So, we think of ourselves not just as technology partners. Pollard Banknote is dedicated to using our skill-sets and resources in whatever ways can serve the interests of our clients, the industry in general, and the mission to generate funds for good causes. Continued on page 38
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