March/April 2014 the Official Publication of the North American

New Hampshire Lottery INSIGHTS Interviews Gary Grief, 2012 vs. 2013 Celebrates 50 Years Executive Director, Texas Lottery Quarterly Sales by Product

The Official Publication of the North American Association of State & Provincial Lotteries

INSIGHTSMarch/April 2014 2 INSIGHTS March/April 2014

From the NASPL Staff President David B. Gale Executive Director Thomas C. Tulloch Director of Administration Andrew White VP of Operations Tamika Ligon Director of Program Planning The good causes we all work so hard to support offer us professional satisfaction be- John Koenig Graphic Designer yond our daily work. I personally feel lucky Janine Hutzell Accounting to be part of such a wonderful industry. Patricia McQueen Staff Writer During the coming days and months, you Jake Coy Vendor Relations have a chance to share that same sentiment with others through our many NASPL educa- Mike Duff NSI Coordinator tional opportunities. The Lottery Leadership Institute event during April in St. Louis has a record number of registrations once again. The iLottery Game Developers Conference during the month of May presents all kinds NASPL Executive Committee of possibilities for us to brainstorm and toss $4 million to date. This strong beginning is Gary Grief NASPL President around ideas for future products. And, of just another part of NASPL’s effort to create course, the Professional Development Sem- alternative funding mechanisms that will Paula Harper Bethea NASPL First Vice-President inar in Myrtle Beach at the end of July will support many of the complimentary services Terry Rich NASPL Second Vice-President be instrumental in NASPL’s mission to share now offered by NASPL and allow us to- ex and exchange information within the mem- plore other services in the future. May Scheve Reardon Treasurer bership. Finally, I want to thank Terry Rich for his Rose Hudson Secretary That ability to exchange information is an im- efforts on the latest NASPL media release Buddy Roogow Immediate Past President portant tool as we attempt to keep up with which discussed adverse weather many of the ever changing Internet gaming legisla- our members have suffered and the nega- Greg Mckenzie Pres. Interprovincial Lottery tion efforts at the federal level. NASPL and tive impact such weather can have on lottery Carole Hedinger Region I Director its members must stay vigilant. Whether it’s sales. The article allowed the membership now or in the future, this topic will affect us to refer questions and inquires on this sub- Alice Garland Region II Director all at some point. I encourage you to stay in- ject to the NASPL website. Regardless of Randy Miller Region III Director formed, use all lines of communication, and, whether the issue being addressed is sales, most of all, continue the effort. weather, or any other subject, collaboration Jeff Hatch-Miller Region IV Director to create a unified message through the NASPL will soon be calling for Powers Awards voice of NASPL helps us all. and Ott Brown Scholarship entries. I encourage those of you in a position to nominate As NASPL President, I greatly encourage you worthy staff; do so. Both awards are unique to take advantage of the many opportunities in the fact they annually recognize various I’ve noted that are provided to you by your major lottery disciplines and the profession- association. The sky is the limit when all get INSIGHTS als that work within them. All individuals involved. nominated will be formally acknowledged and the awards will be presented at our Circulation: Professional Development Seminar. Please Lottery Insights ISSN 1528-123X, take the time to recognize a staff member March/April Issue 2014, or a vendor representative; their hard work Volume No. Fourteen, Issue Seven. is critical to the effort of generating revenue Published bi-monthly by NASPL (North American Association of State for good causes. and Provincial Lotteries)

And, speaking of good causes, I’m proud to 1 South Broadway, announce that the “Scoop the Cash” sratch- Geneva, OH 44041 off game has launched in my home state of Texas. The Texas Lottery Commission was © 2014 All rights reserved. the first jurisdiction to do so. With no mar- Gary Grief keting or ad support, “Scoop the Cash” has NASPL President NASPL Email: [email protected] been our second best $1 ticket over the past Executive Director, Web Site: www.naspl.org seven weeks and gross sales have gone over Texas Lottery Commission Phone: 440.466.5630 Fax: 440.466.5649 INSIGHTS March/April 2014 3 March/April 2014

4 Around the Industry What’s happening around NASPL 10 What I Like about these Things Stephen Wade, Research and Development Manager, Washing- ton’s Lottery and Principal, Lottery Management Consulting, LLC 14 14 They Invented Lucky Fifty years ago, the New Hampshire Lottery became the first modern lottery in the U.S., and an entire industry was born. By Patricia McQueen, NASPL Staff Writer 18 Making a Difference: Kassie Strong, Chief Financial Officer, New Hampshire Lottery 22 22 Q/A with Gary Grief, Executive Director, Texas Lottery Commission/NASPL President By Patricia McQueen, NASPL Staff Writer 32 50 years of milestones and innovations in the lottery industry 32 42 A Look at the Next 50 Years 50 2013 Holiday Instant Recap By Patricia McQueen, NASPL Staff Writer 64 50 NASPL quarterly Sales, 2012 vs. 2013 4 INSIGHTS March/April 2014

Around the Industry A look at what’s happening around NASPL

training, retailer training, game design, The Hoosier Lottery will be seeking level Hoosier Lottery Recog- marketing and advertising communica- 4 certification in the future, and hopes to tions, stakeholder engagement and re- be among the first lotteries in the Unit- nized by World Lottery porting. ed States to achieve the highest level of certification awarded by WLA. There are Association In its application to the WLA, the Hoosier currently no lotteries in the United States Lottery made 39 commitments to social that have achieved level 4 certification, responsibility, including its “play respon- which requires an independent, third Awarded for Excellence sibly” logo with the gambling addiction party audit of responsible gaming pro- in Responsible Gaming referral line on tickets and advertise- grams. ments and its creation of the Responsi- ble Gaming Advisory Council to engage “The Hoosier Lottery is dedicated to up- the treatment community in the lottery’s holding the ethics and standards of the responsible gaming programs. Other WLA’s principles of responsible gaming,” commitments, such as problem gambling said Hoosier Lottery Executive Director research, employee training, retailer Sarah Taylor. “These principles are nec- training and game design, are expected essary to ensure the protection of Hoo- to be implemented over the course of sier Lottery players, and emphasizes our the next 18 months. commitment to our fellow organizations that are equally dedicated to addressing “The Hoosier Lottery maintains a high the effect of gaming on Hoosiers across standard of leadership to ensure their the state.” efforts are in tandem with current re- The Hoosier Lottery has been recently sponsible-gaming research, treatment The World Lottery Association (WLA) is recognized for excellence in responsible and protocols,” Kevin Moore, director of one of the world’s most respected indus- gaming by the World Lottery Association. Division of Mental Health and Addiction try authorities on responsible gaming. Its This is the first time in WLA history that Indiana, said in a letter to the WLA. “This responsible gaming framework has been a lottery has applied for one level of cer- [certification] not only impacts the con- in place since 2006. tification and achieved a higher level of stituents we serve, but helps to improve certification. the expectations by which all gaming in- stitutions in Indiana are being held.” The Hoosier Lottery is one of only four U.S. lotteries to have reached WLA’s re- The Indiana Council on Problem Gam- sponsible gaming framework level 3 cer- ing lauded the Hoosier Lottery to the tification. WLA certification body, citing -the lot tery’s creation of a dedicated responsi- The certification is awarded by the WLA’s ble-gaming staff position, and convening Independent Assessment Panel of inter- a problem-gambling stakeholder summit national experts in corporate social re- meeting to discuss the current prob- sponsibility, and is based on a state lot- lem-gambling programs in Indiana, and tery’s contributions to problem gambling to identify needs and initiatives that can research, treatment referral, employee improve Indiana’s overall efforts.

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Around the Industry A look at what’s happening around NASPL

does Lucy deliver on sales, but the proper- Alchemy3 has done a thorough creative Alchemy3 Introduces ty also provides lotteries with the opportu- exploration of the Lucy brand including nity to create exciting publicity and event new instant ticket concepts, innovative NEW WAYS to love Lucy! extensions” said Jeffrey Schweig, President mobile apps and draw game promotions. of Alchemy3. There are also exclusive opportunities for Alchemy3 recent- Lotteries to partner with the new on-stage ly announced that While I Love Lucy has been a part of pop version of the classic TV show called “I Love they are the exclu- culture for over 50 years, it continues to Lucy Live On Stage”. sive representative appeal to new generations of consumers. for the I Love Lucy The show has remained in syndication “Building on the successful release of the brand. The Iconic since its inception and Millenials are just colorized version of the Christmas spe- 1950’s show was as intrigued as their Baby Boomer coun- cial last year, which drew over 8.7 million first introduced to terparts. viewers, with more colorized episodes to the Lottery indus- follow, we have brought the same color try by Alchemy3’s “The show’s principles are timeless with vibrancy to our Lucy themed products and founders in the mid 1990s. comedy, laughter, love and friendship promotions. We look forward to sharing which everyone identifies with. There was these new ways to love Lucy with our Lot- Over the last 20 years, many Lotteries have something inside of them that’s inside of tery customers” Schweig concluded. 77352run ILottery Love LucyInsights games--some half page ad repeated cropmarks.pdf- all 1of us.” 3/5/14 said Desi 9:57 Arnaz, AM Jr., son of Lucille ly,--with strong sales results. “Not only Ball and Desi Arnaz.

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Around the Industry A look at what’s happening around NASPL

NJ Lottery, Council on Compulsive Gambling and NJ Division of Mental Health and Addiction Services Mark Problem Gambling Awareness Month

Officials Spotlight Initiatives Promoting Responsible Play

Governor Chris Christie has issued a Proc- lamation declaring March 2014 Problem Gambling Awareness Month in New Jersey. Throughout the month, the New Jersey Lot- tery (NJL) and the Department of Human Services Division of Mental Health and Ad- diction Services (DMHAS) worked with the (Left to right) National Problem Gambling Awareness Month Campaign Chairman Jeff Beck, Council on Compulsive Gambling of New Division of Mental Health and Addiction Services Director of Prevention Donald Hallcom, Jersey, Inc. (CCGNJ) to educate the general NJ Lottery Executive Director Carole Hedinger and Council on Compulsive Gambling of NJ, public and health care professionals about Inc., Executive Director Don Weinbaum participated in a joint press conference to announce the warning signs of problem gambling and March 2014 as Problem Gambling Awareness Month. to raise awareness of the help that is available both locally and nationally. the unique challenges facing those with and a concern for everyone,” Beck added. “It Carole Hedinger, NJL’s Executive Director, gambling problems,” said Weinbaum. “It is is not just a New Jersey issue, but a national and Donald Hallcom, DMHAS’s Director of never too early or too late to get assistance and international one:” Prevention, met with Donald Weinbaum, for yourself, a friend, family member or a col- Executive Director CCGNJ and Jeff Beck, league that you believe may have a gambling CCGNJ operates a 24-hour confidential help- Chairman of National Problem Gambling problem. We’re very pleased to be partner- line, 1-800-GAMBLER, that takes over 15,000 Awareness Month, to discuss joint efforts ing with the Lottery and the Division of Men- calls a year. Any individual with a gambling to promote awareness about the dangers of tal Health and Addiction Services to get that problem or a family member needing assis- problem gambling. message out to an even broader audience.” tance can call for help and referral. Infor- mation on Problem Gambling Awareness “The Lottery is proud of its commitment and “Compulsive gambling, like drug and alcohol Month activities in New Jersey and addition- initiatives in building awareness of problem addiction, can be successfully treated,” DHS al resources can be accessed through the gambling within the State,” Hedinger said. Assistant Commissioner of Mental Health CCGNJ website: Since June 1999, it has participated on the and Addiction Services Lynn Kovich said, not- http://www.800gambler.org/ Council of Compulsive Gambling’s Board of ing that DHMAS helps fund prevention, re- Directors. The Council’s 1-800-GAMBLER ferral and treatment for gambling addictions The National Problem Gambling Awareness helpline number is printed on every Lottery and allocates money to CCGNJ operations Month website also lists resources and help- ticket, and on all brochures and signage, and every year. “For the majority of people, gam- ful toolson its website: it also appears as a tag line on all of the Lot- bling is a choice, but the minority of people http://www.npgam.org/ tery’s radio and television advertisements. who are problem gamblers need to know The Lottery’s website directs visitors to the there are services to help them recover.” CCGNJ, which works with treatment provid- Council’s site, where members of the public ers and conducts prevention outreach pro- can get free information and help. “Our campaign this year is titled “Navigate grams, is partially funded by assessments Problem Gambling” and was focused on on off-track wagering licensees and forfeited “The Council continually works to address problem gambling as a public health issue casino proceeds. INSIGHTS September/October 2013 9 10 INSIGHTS March/April 2014

What I Like about these Things

Stephen Wade, Research and Development Manager, Washington’s Lottery and Principal, Lottery Management Consulting, LLC

It has often struck me as paradoxical that my friend M., an economist who seems to thoroughly understand lotteries, is an enthusiastic player. I am not sure that I would play as much as he does if I could. Once I watched M. scratch his way through a spread of $10 tickets at lunch, and asked him, “What is it you like about these things?”

“Certainly not scratching them. What a mess!” He used a nap- tions, and I was pleased that he was about to trust me with kin to gather the leavings onto his tray as we left our lunch some confidence. spot and walked, as often, across the campus. “My brother-in law is an engineer. He helps build things “I have thought about this, actually. For me, it is a form of that work. I kind of envy him for how successful his whole mental discipline.” enterprise is. He is very much involved in the manufacturing process. He is Six Sigma up to his ears.” I heard this with a sense of alarm. Once upon a time, some accomplished analyst had famously learned to “break” some “Six Sigma” was only vaguely familiar to me from some train- Scratch games. I would not have put it past M. to find any ing I had once had, but fortunately M. drilled right into it. weaknesses that remained in our products. Cautiously, I “Six Sigma, in a manufacturing environment, is all about asked “Have you found a way to apply skill in playing scratch eliminating variability. My brother-in-law loves precision, games?” attacks variability at every turn, and is wildly successful. At manufacturing.” “Oh no. Quite the contrary. Playing these games is a celebration of no-skill, no control, just chance.” I wanted to hear what the brother-in-law was not successful at, but I needed to ask about the weird terminology. “What kind of mental discipline is that?” “Oh, sigma, that’s shorthand for ‘one standard deviation “Training in humility, maybe? No, that’s not quite right. I take of variability.’ It’s the thing you remember from statistics. pride in resilience. It’s more a celebration that I don’t need You will see one sigma, plus or minus, about two-thirds of control. I am going to be OK no matter how the tickets play.” the time, you remember. A one-sigma result is common, a three-sigma result is very rare, and a six-sigma result is wildly “But if it doesn’t matter how the tickets play, why play unlikely. The doctrine is that a defective result, of a process them?” that I have properly engineered, is wildly unlikely.”

“It’s play, right? If it mattered, it would be work. Maybe I play I recalled the famous bell-shaped curve, with three sigmas them to remind myself how I am not like my brother-in-law.” corresponding to the resonating rim of the bell. This was the first time I had heard M. mention family rela- INSIGHTS January/February 2014 11 12 INSIGHTS March/April 2014

“The way my brother-in-law succeeds is to attack sigma, to from large numbers of people, and repackages this as large suppress variability. Sigma must be so small that a three-sigma amounts of money for small numbers of people. It’s all fair result looks a lot like a one-sigma.” and square. The process is transparent. You only charge the people who use the service. What’s not to like about that? It’s “So, your brother-in-law’s bell curve looks more like a wind a huge public benefit.” chime?” “And we fund good works, too!” I said. M. smiled. “Yes. Very straight and narrow. He’s the kind of guy who uses a meat thermometer when he’s grilling. He would “You know,” said M., “I don’t even judge how good the works have been happier yesterday if I did, too. Not a big problem you fund might be. They may or may not be better than what now, but a little wearing on the wife and kids. The teenage is done with other government money. For me, the main years are going to be tough. benefit is in that repackaging of wealth. It’s something like recycling – gathering up empty cans that become aluminum “I, on the other hand, figure that I don’t necessarily own the ingots. You gather up odd dollars that might be spent on processes that are upstream of where I stand. Sigma is what it something useless, and compact them into chunks that can be is. My way to success has to be to cultivate resilience. What- useful.” ever happens, I can handle it. That’s my attitude. That’s what I aspire to.” “So you see a public benefit regardless of how the money is used?” “So you play scratch tickets to prove your resilience?” “Absolutely. And I am happy to subscribe to your service.” “I doubt that it proves anything. More it reminds me that my successes are not all mine. Likewise my failures. ” I report this conversation because it has been helpful to me to recall it. I do not suppose that many scratch players would The idea of using gambling to cultivate humility struck me as express anything like M’s “mental discipline” as a reason for quaint. Like most people, I prefer to attribute my successes playing. Mostly, as we know, they say they play to win the big to my own agency, and my failures to the agency of others. I prizes. And most of them, as we know, never win big prizes. was picturing M. as a hair-shirt-wearing holy man of medieval But I would not discount that they feel some sort of mastery times when he surprised me by saying: as players. Maybe M’s ideal of resilience would not be foreign to them. “I suppose that managing a Lottery must remind you of that all the time. After all, you’re gambling too, right?” As for our roles as lottery managers and gamblers, I have become pretty comfortable with this. In public service we all I continued as if a large puddle had appeared in the path. In undertake to manage things we can’t completely control. In fact, at work we had been engaged in one of those periodic the lottery world the results are very measurable, but also efforts to align our efforts to a new variation on the theory merely financial. of management. I liked thinking about control systems. I was completely on board with the idea of better empowering In my experience, it is relatively easy for managers to recog- people. But I was struggling with how much ownership I could nize the role of random variation in causing shortfalls. It is really have over the financial outcomes. I felt like I was bluffing much harder for them to give up credit for surpluses. A wise when I agreed to own things I could not control. I expressed person, I suppose, would be able to be both a manager and a this to M. gambler at the same time.

“Right!” he said. “That’s gambling. You can’t control it, but Lastly, I am encouraged to remember that not only what we you’re going to own it. That’s the deal.” do with our money, but what we provide for players to do with theirs can be seen as a public service. “You know, we really don’t think of ourselves as gamblers.”

“Well no, I suppose not. You are so big and diversified that your results don’t vary all that much from one year to the Stephen Wade next. It’s the variations that remind you of the game you’re in.” Research and Development Manager, Washington’s Lottery and Principal, “In fact,” M. continued, “I think of you as financial service providers. The Lottery gathers up small amounts of money Lottery Management Consulting, LLC INSIGHTS March/April 2014 13 14 INSIGHTS March/April 2014 They Invented Lucky! Fifty years ago, the New Hampshire Lottery became the first modern lottery in the U.S., and an entire industry was born.

By Patricia McQueen

In the beginning, it took ten years. sagging for too long. “I had to change viewed in the public eye, and about That’s how long State Representative that around,” he said, and he took on what the public really wants from their Larry Pickett of Keene, N.H., tried to the task with gusto. And after four lottery.” pass a sweepstakes bill as a “viable and straight years of declining sales, bot- One thing officials discovered is voluntary method of raising money for toming out in fiscal 2011, sales have that messaging doesn’t really change education.” He started in 1953, and rebounded, growing by a total of more the behavior of older players. In con- finally succeeded in 1963, when Gov. than 22 percent over the last two years. trast, younger consumers not only can John King signed the bill. The next year, Record sales of $280 million in fiscal be influenced by advertising, but they voters in 198 of 211 cities and towns 2013 produced $74 million for edu- are quite willing to talk about lottery. approved the new lottery, and New cation, the Lottery’s highest return in Older players perhaps grew up in a Hampshire Sweepstakes tickets went five years. “We went from being one of time where it was not acceptable to on sale March 12, 1964. the worst lotteries in the U.S. in terms talk about “gambling.” So by focusing In the beginning, it took six of annual growth to being one of the its messages on a younger demograph- months. That’s how long players had best,” said McIntyre. ic, the Lottery has been able to make to wait from the time the $3 sweep- How did New Hampshire do it? that messaging more effective. stakes tickets first became available to “It really was just about going back And New Hampshire has really the time when they could win prizes to the fundamentals of business,” he concentrated on its scratch ticket pro- based on a horse race at Rockingham explained. Acting like a business, fos- gram – those games account for almost Park. That race, the New Hampshire tering relationships with retailers and 70 percent of its sales. In addition to Sweepstakes, was run September 12, redeveloping relationships with the fine-tuning the price points and prize 1964. At the time, $1 million worth of legislature – all of that has paid off structures, the Lottery has implement- tickets had been sold, and tickets were handsomely. ed a regular delivery system that intro- drawn and paired with horses running duces new games on the first Monday in the race. If it sounds familiar to Putting it all together of every month. “With this once-a- some of you, that’s not surprising – it month delivery, we see that the games was modeled after the Irish National One key was establishing a bonus are fresh in the minds of the players for Sweepstakes. program for retailers, which provides the entire month,” noted Director of In 50 years, almost everything has them with significant extra revenue Marketing Maura McCann, adding that changed. But the fundamental goal of as they sell more tickets. There is also retailers also know when to expect new raising money for education has re- a new bonus program for the Lottery’s games and are prepared for them. And mained, and since that humble begin- own sales reps, encouraging them to unlike terminal-based games, where a ning, more than $1.5 billion has been find ways to help retailers drive sales. jackpot might get hit at $40 million one delivered to public education in New You don’t often find those two pro- week and then run to $500 million un- Hampshire. grams in state government, noted til it gets hit again, instant games offer “From where we started to where McIntyre, but they have worked. Still, predictability. “We certainly know what we are now, it’s like the evolution of they have to work in concert with oth- we can control and we can work with it man,” exclaimed Charlie McIntyre, er measures – most importantly, giving to make the best experience possible.” who since 2010 has served as the New the players products that they want One program that is very import- Hampshire Lottery’s Executive Director. to buy. “There’s no ‘easy’ button. All ant to the Lottery is Replay – which lets “We pretty much define mature.” the stuff that we take for granted has players enter any non-winning tickets And yet, there is plenty of life in to be done well – things like ticket ap- into their account and accumulate the old lottery these days. That became pearance, point of sale merchandising, points for a chance to win prizes ev- clear after McIntyre took over almost messaging, advertising and branding. ery month and even bigger “ultimate” four years ago. At the time, it didn’t We do a lot of research on how we are prizes every quarter. Launched in 2006, look that promising. Sales had been Replay now has more than 200,000 The New Hampshire Lottery formally kicked off its 50th celebration on March 12 with Governor Maggie Hassan purchasing the first Granite Millions ticket at the State House. Pictured with Executive Director Charlie McIntyre is Gov. Hassan (on the right) and Debra Douglas, chairman of the New Hampshire Lottery.

members, and in a state where the adult is happening specifically for Replay mem- tyre. “In fact, we have an excellent relation- population is a little over one million, that bers, like special promotions. ship with our politicians right now. That is number is astonishing. Although truth be The database is also used to survey never easily won, nor easily maintained, told, there are members from all 50 states, customers about current products and po- but well worth it in the end.” and in a region as geographically compact tential new products, but that’s just the tip Gov. Hassan helped the Lottery kick off as New England, there are a lot of regular of the iceberg. “We want to get a better un- its 50th anniversary celebration on March New Hampshire Lottery players who don’t derstanding about who our players are. It’s 12 with a ceremonial purchase of Granite actually live in the state. not so much about our own products – we Millions. The new $25 scratch ticket is New Replay was designed to provide play- also ask about how they spend their enter- Hampshire’s first game at that price point, ers with more value for every ticket they tainment dollars.” with a top prize of $2 million; at this writ- purchase, explained McCann. “We’ve al- The Lottery just launched a mobile ing it offered the highest prize payout of ways strived to make the whole lottery ex- website, and is active on social media any ticket in the U.S. – 81.8 percent. The perience bigger and better for our players. as well. “Social media is another way of festivities on the day also included the first Winning tickets are great, but if they don’t talking to those people that want to hear stop on what will be a statewide tour that have a winning ticket, Replay provides an- from us,” said McCann, adding that the continues through September. The- Lot other level of entertainment value.” There platform will be used extensively during tery’s road show will stop at a dozen loca- are instant-win prizes along with month- this anniversary celebration year. tions – showcasing retailers that have been ly and quarterly prizes; the latter can be selling lottery longer than anyone. With all worth up to $5,000. Positive relationships all this going on, McIntyre expects another big Aside from extending the experience year. for players, Replay gives the Lottery some- around And that is something everyone is thing even more valuable – a chance to looking forward to. McCann, who has been communicate with its customers. “It’s a Cultivating relationships with players with the New Hampshire Lottery for almost very large database of people who have and retailers is critical, but as mentioned 30 years, marveled at how great it is that told us they want to hear from us. We really earlier so is working with legislators and lotteries and vendors work together and work hard to talk with them,” said McCann. those in the executive office. New Hamp- share ideas. “We’re all trying to achieve the Members get a weekly email newsletter shire will host NASPL’s annual Director’s maximum sales in order to return money about all the things going on at the lottery Meeting in June, with the theme “It all to our states, and it’s fun. How many other each week – new games, promotions and started here.” Gov. Maggie Hassan is ex- people can really look forward to getting jackpot notices, for example. There’s also pected to speak at that event. “She is a big up in the morning and knowing that you a monthly newsletter that focuses on what supporter of the Lottery,” explained McIn- are going to have fun at work that day?” 16 INSIGHTS March/April 2014 $2,000

1963 1964 1977 APRIL 30 SEPTEMBER 12 MARCH 21 Governor John W. After selling its first Pick 4 Daily Numbers King signs the bill $1,000,000, tickets game debuts as an making the first are pulled from a alternative to the state-run lottery, and large drum by Miss 50/50 game. Sales the first legal lottery New Hampshire, average $2,000 a day in the United States. Elizabeth Emerson. in 1977. The bill is offered by The winners are paired Keene Representative with thoroughbreds Laurence Pickett (D). 1964 nominated to run in 1971 1985 Representative Pickett MARCH 10 the race. JUNE SEPTEMBER 23 had lobbied for a The sales of Sweeps The New Hampshire The first Tri-State lottery for 10 years, tickets are voted upon Sweepstakes Megabucks jackpot from 1953 to 1963. by Granite Staters. introduces its first TRI-STATE from the There was approval weekly drawing, the drawing on of the Sweeps by a 50 cent 50/50 ticket. September 14, nearly 3-1 margin. Its low price and MEGABUCKS 1985, totaling weekly drawings help $993,140, is won and boost the lottery’s claimed by Richard revenue to nearly Campbell of South $4.3 million that year. Portland, Maine.

NEW HAMPSHIRE LOTTERY

1963 1964 1985 AUGUST 26 SEPTEMBER 12 APRIL 23 Edward Powers takes “Roman Brother” wins The New Hampshire over as Sweepstakes the first running of Lottery (Sweepstakes Director. Powers had the New Hampshire is dropped to the more been the head of the Sweepstakes by recognizable term of New England FBI, the a half-length over lottery) becomes part agent who cracked “Knightly Manner.” of the first multi-state the Brinks armored The race from lotto game, joining car case, and the only Rockingham Park the states of New agent in FBI history 1964 is rebroadcast that 1975 Hampshire, Maine 1987 to capture two of the MARCH 12 evening on ABC Wide JANUARY 29 and Vermont together SEPTEMBER “Top Ten Wanted” at Governor John W. World of Sports. The instant scratch to offer Tri-State Revenue earmarked the same time. King buys the first ticket is introduced. Megabucks. for New Hampshire ticket at Rockingham ‘Lucky X’ offers public education Racetrack. Each ticket players on-the-spot, surpasses $20 million cost $3 and offered play-and-get-paid for the first time. prizes of $200 up to convenience. Sales $100,000 during a skyrocket and revenue horse race to be run doubles that year to later in the year. $11 million. INSIGHTS March/April 2014 17

1990 1996 2006 For the first time, MARCH 30 JUNE 2006 6 different instant Dean Leighton The Lottery, in keeping scratch tickets were from Chester wins with its reputation offered to our players $51 million and of being the first, helping to boost becomes the first introduced its Replay the net profit, which Powerball winner in program, the first of is earmarked for New Hampshire. its kind in the Lottery education, to a record industry. The program of $32.6 million. 1992 offered players the 1998 chance to replay all 2013 APRIL MAY 18 of their non-winning JANUARY Tri-State Lotto The Lottery tickets for additional New Hampshire Commission unveiled celebrates prizes. Lottery surpasses the Tri-State CASH 5 the grand $5 billion in game in April of 1992. opening ticket sales. 14 INTEGRA DR. of its new state-of-the- art headquarters at 14 Integra OVER Drive in Concord. $5,000,000,000

CELEBRATES 50 YEARS!

1990 1997 2009 MARCH 28 Instant scratch MARCH 12 Ernest Ayotte is a tickets generated The Lottery man of firsts. When $111 million in celebrates the Lottery began revenue. If laid end 45 years. selling the new to end this would NG 50 YEARS OF WINNING BRATI 1964-2 Cash Lotto tickets on be approximately CELE 014 March 28, he was the 84,105,859 miles first in line at Corner of tickets. News in Keene. Twelve weeks later, Ernest 1995 2001 2013 became the first-ever NOVEMBER 5 This year 50 instant JUNE 30 winner of the state’s New Hampshire scratch games were New Hampshire newest game. joins the Multi-state featured including Lottery breaks their Lottery Association the popular game all-time sales record and begins selling “Elvis” which offered and surpasses Powerball tickets. trips to Graceland $278.7 million in and Elvis total sales for the merchandise. fiscal year of 2013. An increase of 10% over the previous fiscal year. 18 INSIGHTS March/April 2014 Making a Difference Kassie Strong, Chief Financial Officer, New Hampshire Lottery

As the New Hampshire Lottery celebrates its 50th anniversary this year, it is clear that the organization has fostered tremendous loyalty among its employees. There is none more devot- ed than Kassie Strong, who with tenure of more than 30 years is currently the Lottery’s lon- gest-running employee. She was recently promoted to the position of Chief Financial Officer.

“Kassie is a major asset to the New Hampshire Lottery and traffic controller. But fate intervened again and she left the the lottery industry in general due to her length of govern- Navy before her first son was born. ment service as well as her deep knowledge of accounting, specifically accounting within state government,” said Execu- As it turned out, Strong must have had a guardian angel, be- tive Director Charlie McIntyre. “The employees within her de- cause she found a temporary part-time clerk position with partment greatly respect her and she has a wonderful ability the bingo division of the New Hampshire Lottery in 1983. Al- to work with all of those employees, bringing out their own though she had never even used a calculator, she took to the strengths and allowing for their own growth and promotion.” task so easily that she was asked to join the Lottery full-time as soon as she was ready to return to work after a few weeks It took Strong a couple of years out of high school to real- of maternity leave. In hindsight, she should have known this ize that accounting was her true calling. An animal lover, was her destiny – in order to complete her high school re- she dreamed of becoming a vet and focused on science in quirements, she had to take a business class to balance out all high school. But college and veterinary school were out of the science work, and she chose accounting. “I hardly had to the question for a girl from a poor family. Still, she was de- open the book,” recalled Strong. “It was so easy for me and I termined to become the first member of her family to go to even won an award.” college, so she joined the Navy with the goal of eventually getting her education that way. She scored exceptionally well And she never looked back – rising through the ranks at the on an aptitude test and was sent to begin training as an air Lottery while completing her higher education goals through

20 INSIGHTS March/April 2014

a state-sponsored tuition payment program. Ultimately, she began. As technology advanced, I was chosen to do the sys- received a Master of Science degree in accounting at Southern tems testing for all of our reports. And when we joined Power- New Hampshire University. ball, we had to start an ICS system and I was involved in that. To this day, I still help with ICS a few nights a month in addition Once her education was completed, Strong suddenly found to my regular work. herself with time on her hands. She enjoys spending time with her sons Derek and John, taking family vacations with them Is there something about the lottery industry generally, or around the world. Together with her eldest son, she volun- the New Hampshire Lottery in particular, that has kept you in teers with Live and Let Live Farm, a New Hampshire organi- the business for more than 30 years? zation that rescues abused and unwanted animals, primarily It really is all about family – people here share their lives and horses. their experiences as if we were one big happy family. Every- one always included me in everything – I got to travel a little Most recently, she added tutoring to her resume, working for because of systems testing and the Tri-State business. Many the technical college where she got her Associate’s degree. times I was brought along to various legislative hearings and And this fall, she hopes to teach an evening accounting class as meetings to learn behind-the-scenes about anything having to an adjunct professor. do with lottery accounting and finance operations. The people I worked with really believed in me. They pushed me to What made you join the Lottery back in 1983 in a part-time complete my education, and they became my mentors and my position? family. How could I not stay and give them everything I had? Honestly I was just looking for a temporary job while I was pregnant. I saw the part-time job posted with the bingo divi- What would you say is the most exciting thing for you per- sion and its three-month duration was just perfect. But as it sonally about the Lottery’s 50th anniversary celebration this turns out, they loved me and wanted to keep me. When I was year? ready to return to work after a few weeks off, they sent me to What I really love about our year-long celebration is that we the Daily Numbers area to help with retailer activities, working will be making a lot of people happy with extra promotions, with Jim Wimsatt. I also got to help sell tickets at the old 50/50 contests and prizes. When people win, they are happy. There’s Draw, and for a young kid, that was really exciting. nothing like working in a place where you can make people happy. And of course, I just love working for the Lottery be- Any thoughts about the accounting path that has taken you cause our profits go to support education in the state. That to the current role of Chief Financial Officer? really makes you feel like you are making a difference. I’ve always been very good in math, and accounting just comes so easy to me. It’s hard to explain, but I find it exciting. I like What are you most looking forward to as you continue your the challenge of figuring out things, especially when it comes career with the Lottery? to numbers. And I’ve had many challenges over the years at I’m really excited about the future. Technology is changing the Lottery – it wasn’t long before I was moved from the Daily things so rapidly, especially with what you can do on mobile Numbers area to the accounting department. Jim (Wimsatt) al- phones. It’s hard to imagine that when I started at the Lottery, ways believed in me, as did Robert Brotherton, and they hand- we didn’t even have computers – everything was processed by picked me for numerous tasks along the way. For example, I hand. So I’m looking forward to the lottery continuing to grow, helped develop the accounting procedures for the lottery in- and to expanding my own knowledge and experience in this dustry’s very first multi-state game when Tri-State Megabucks exciting new era. INSIGHTS September/october 2013 21 22 INSIGHTS March/April 2014 INSIGHTS March/April 2014 23

Gary Grief was appointed Executive Di- rector of the Texas Lottery Commission in March 2010 after serving as acting Execu- tive Director since October 2008. He has been with the Lottery since its inception, and was part of the original 1991 Lottery Task Force assigned to research and launch the Texas Lottery. Grief has received numerous honors in his distinguished career, including NASPL’s prestigious Powers Award. He is currently serving a term as the President of NASPL. Insights recently asked him to reflect on the industry’s 50th anniversary and what it will take to thrive in the next 50 years.

This year marks the 50th anniversary of the the ideals of the original lottery pioneers in per- modern lottery industry in the United States. spective. That is, as we move into the digital era, What does this mean to you as a lottery direc- with lottery tickets being sold through a number tor? On a broader scale, from your perspective of new channels – the Internet, ATMs, mobile as NASPL President, what does the milestone devices, etc. – we would be well served to keep mean for the industry as a whole? Why should in mind that these opportunities must be tem- we take notice? pered with the mandate that integrity and se- Fifty years of lotteries generating much need- curity be our guiding values. If we ever give our ed revenue for good causes is an impressive players a reason to doubt the reliability of our milestone. I’m always fascinated to read about games, we can close up shop. those lottery directors who were the pioneers in our industry, larger than life characters like In contrast, the Texas Lottery is “only” 22 years Ralph Batch and Major Peter J. O’Connell. One old this year. What would you describe as its of my personal highlights was meeting Major major achievements over the years? O’Connell at last year’s NASPL Conference in Texas is still one of the “younger” lotteries in Rhode Island. Starting and running a state lot- the U.S. market and, since I have been with the tery in the early days, after years of lotteries be- Texas Lottery since day one, I certainly don’t like ing viewed in a negative light, must have been to think of us as “old!” That said, I, like all of my extremely challenging and rewarding at the colleagues around the country, have a certain same time. We owe a large debt of gratitude to amount of pressure inherent in my mission to the early pioneers of our industry for ensuring produce revenue for good causes. That pressure that the first lotteries were operated with the varies from state to state, but it definitely exists. utmost integrity and security. Anything short of The U.S. lottery industry has experienced signif- that would have been a death knell for lotteries icant growth in the last few years as a result of in the U.S. Thanks to those early lotteries pav- several factors: the “cross-sell” agreement, $2 ing the way, lotteries around the country have Powerball, enhancements to the Mega Millions generated billions of dollars in proceeds for the game, and optimal pricing and development of good causes that lotteries support. the instant product. With that success comes greater reliance on this revenue by state gov- As we mark our 50th anniversary of the lottery ernments and the expectation from state lead- industry, the NASPL membership should keep ership that lottery sales and profits will continue 24 INSIGHTS March/April 2014

Speaking of licensed properties, are there any other brands or themes out there that you think would make great lottery tickets? I don’t want to get out in front of our Our trusted vendors Scientific Games/ MDI, GTECH, Pollard and Alchemy3 are con- MUSL colleagues, but I believe that stantly scanning the horizon for new opportunities in this area. Star Trek, Duck Dynasty, Cae- the MUSL organization, through the sars, Home Depot – these are just some of the recent RFP for a National Premium terrific branding opportunities that our vendor partners have recently brought forward Game and TV Game Show, may have for our consideration. come across the “next great thing” Everyone (for example your Beatles concept) seems to have an idea or opinion when it in a licensed property, one that has comes to licensed properties. The devil is in the details. Over the years I’ve received an the potential to energize our indus- education by fire on the use of these licensed try and significantly broaden our properties and, in many cases, the economics just don’t work for some properties. In Texas, player base. for example, a licensed property brand must have a broad enough appeal to be attractive from - Am arillo to Laredo and all points in between. The print quantity for any game must be large enough to make the prize pool attractive to players. And, most importantly, the brand must allow the Texas Lottery to leverage the launch of the product with a significant, newsworthy “event,” one that will generate “free” media long after our advertising budget is spent. Find- ing a licensed brand that meets this criteria is a challenge for us and our vendor partners.

to grow. For Texas, I look back with pride at some I don’t want to get out in front of our MUSL colleagues, but I believe that of our recent achievements: crossing the $16 bil- the MUSL organization, through the recent RFP for a National Premium lion mark to public education, increases in net Game and TV Game Show, may have come across the “next great thing” revenue every year over the last four years and a in a licensed property, one that has the potential to energize our industry record $1.2 billion to education in fiscal year 2013 and significantly broaden our player base. Although I can’t share any de- alone. However, as I mentioned, great accomplish- tails, it’s incumbent upon all state lotteries to quickly come together and ments lead to great expectations, and our signifi- decide on this opportunity at the appropriate time. Texas stands ready to cant national growth opportunities for the future take the next step on the National Premium Game. hinge on our ability to work together as an industry and an association in developing new products, And continuing to talk about products, what is the future theof selling those products in to our colleagues around mega-jackpot games? It seems that it takes larger and larger jackpots to the country, and flawlessly executing the sale of generate the same buzz. Do we just keep changing the matrices to get those products at retail and through new channels bigger jackpots, or is there an end game somewhere? that come available. The “future” of these games directly hinges on our ability as lotteries to work closely together and collaborate on the direction of these games, As an aside, it just so happens that 2014 is also and to do this in a timely and logical manner. the 50th anniversary of The Beatles’ first appearance in the United States. Wouldn’t it be cool to Jackpot fatigue is something we’ve been talking and arguing about in the have a series of Beatles scratch tickets? Think of U.S. market for the last 25 years. As an industry, we are attempting to refo- the marketing and sales potential! cus our efforts not so much on record jackpot levels, but instead on build- Agreed! Although I shudder to think what Paul, ing our trusted national brands, Mega Millions, Powerball and our “to be Ringo and Yoko might ask for as a licensing fee, determined” National Premium Game, in such a way that we can leverage much less an appearance fee, a Beatles ticket those brands in other revenue generating opportunities, with the ultimate would definitely be a fun product and one that goal, of course, being to generate more revenue for good causes. would generate excitement. Let’s use this article as our way of asking our vendor partners to look However, without a doubt, generating bigger jackpots has served the into that for us. U.S. lottery market well over the last 25 years, as evidenced by the tre- INSIGHTS March/April 2014 25

mendous sales growth in the multi-state category, so we Although we definitely need to be ready with plans for additional know we cannot completely turn our back on our players’ changes to these games in the near future to respond to chang- demand for huge jackpots, and we should monitor our del- ing market conditions, a clear and unified focus on the National icately balanced portfolio of national games with that in Premium Game, something that can create a new and unique mind as we go forward. level of interest and attention for our industry on a national scale, is critical to keeping the lottery product relevant. I believe the With all that in mind, what would you say are the most two current national games, Powerball and Mega Millions, will pressing issues that impact the entire industry today? continue to successfully co-exist, being differentiated, at least in My favorite word…collaboration. the short term, mainly by price point. Our goal is to have these two games complement each other, rather than compete. We’ll Simply put, I believe that U.S. lotteries will continue to see what concepts may come forward from some interesting re- operate at a less than optimum level as long as we have search that MUSL is conducting right now on Powerball and what two separate multi-state game groups. Along with several changes that might mean for the Powerball game in the future. of my colleagues around the country, I have spent the last three years working to merge the Mega Millions and MUSL Alice Garland from North Carolina and I recently participated in groups together and truly leverage our financial and mar- a World Lottery Association (WLA) marketing event in London. keting strength on a unified national scale. This event reinforced for me how painfully far behind the curve U.S. lotteries are in the areas of Internet and interactive gaming. But the wheels of progress turn slowly when you are asking As our lotteries in the U.S. are generally guided in their degree people to consider changing a paradigm that has been in of participation in this type of gaming by the parameters set by place for almost 20 years. To try to move this forward, I’ve individual state policymakers, all eyes of the U.S. lottery indus- recently implemented a significant change on behalf of the try are on our colleagues in those states that are making serious Texas Lottery, and as of March 1, 2014, Texas has transi- movements into the Internet and interactive spaces. tioned from the Mega Millions consortium and become a full member of MUSL and the Powerball Game Group. I’m Taking that a step further, membership and participation in the hopeful this will be the first step in a collaborative process, WLA will become more important for individual U.S. lotteries to with the ultimate goal being to merge all U.S. lotteries un- ensure we learn from past mistakes made in the European coun- der one multi-state organization. tries and fully leverage the technology and creativity available

I’m optimistic that, until such a merger occurs, the two groups will continue the momentum initiated by our cross-selling relationship to focus on the development and launch of a National Premium Game and National TV Game Show. No final decisions have been made by MUSL at this point, but our goal has long been to develop a national premium game, perhaps at a $5 price point, use a national TV game show to market the game and build I’m optimistic that, until such the brand, and, instead of producing jackpots that compete with Powerball and a merger occurs, the two Mega Millions, feature a game with medi- um sized-jackpots with numerous million groups will continue the dollar winners from every participating U.S. lottery. momentum initiated by our cross-selling relationship to Focusing our efforts on a new National Premium Game would also allow time for focus on the development the many recent changes that have been made to ‘Mega Millions and Megaplier’ and launch of a National and ‘Powerball and Powerplay’ to sink in and gain a level of understanding and ac- Premium Game and National ceptance with our retail and player base. When you sit back and observe the landscape TV Game Show. in the U.S. regarding the Powerball and Mega Millions games, we’ve made a number of changes to these games in a relatively short timeframe. 26 INSIGHTS March/April 2014

worldwide. To that end, Texas is currently exploring membership will likely be complemented by a world of “virtual gaming” that with the WLA. will only be limited by the player’s imagination. Is everyone ready to order your “Lottery Virtual Reality Helmet” via the “Thought As more states move into the Internet and interactive space, the Transmission” ordering system from Amazon? issue of states rights regarding Internet gambling continues to be a concern for NASPL. The positions of the casino industry and What are the best strategies for the industry to adopt that will of federal legislators are extremely fluid and monitoring the de- see it through the next 50 years? velopment and/or movement of federal legislation regarding In- The country and the world are shrinking daily as a result of tech- ternet gambling is a significant challenge for the lottery industry. nology and those who are young enough, in body or mind, to embrace it. We must think of ourselves as a truly united “indus- How can NASPL help lotteries deal with these issues? try,” not stay tethered to the boundaries of our state or even As the lottery director in Texas, I’m not allowed by law to lobby continent, and continue to search out the best practices, lessons on behalf of any issue or cause. Many of my colleagues around learned and innovative ideas around the world. the country are similarly situated. I can only serve as a resource to our Legislature. Therefore, the information I provide to my And finally, how will NASPL’s role in the industry evolve over state’s leadership must be accurate and current. NASPL has the next 50 years? worked diligently to become the “go to” entity for resource in- When you look at the growth that the NASPL organization has formation and I frequently rely upon the NASPL staff for backup experienced over the last 45 years, that growth was dictated by data as I prepare for legislative hearings or meetings with poli- the needs of the lottery industry. What once was an organization cymakers. Whether the subject is Internet gaming, responsible representing only 11 lottery jurisdictions in the early 1980s now gambling policies, or the latest sales information for any lottery has a current membership of 53 jurisdictions comprised of every game offered in North America, NASPL must be diligent in stay- government-sanctioned lottery in North America, Puerto Rico ing abreast and, hopefully, ahead of the curve on all important and the Virgin Islands. That said, the primary mission of NASPL legislative or business developments that may impact our ability has not changed - to provide a central location for the sharing as lotteries to generate revenue for good causes. of industry data, standards and expertise, and to provide educational opportunities for the industry. What will be the most significant “new thing” the Texas Lottery will implement in the next five years – considering games, tech- As the number of lotteries in North America has grown signifi- nology, distribution? How about the industry as a whole – is cantly over time, leaving very few remaining jurisdictions with- there something that you might not see coming in Texas, but out a lottery, there is definitely a shift taking place in the associ- that will happen elsewhere and impact the broader industry? ation – with less of a role in assisting new lotteries and more in The Texas Lottery must be careful to operate our lottery within assisting existing lotteries in their quest to be better prepared for the boundaries of our law and the decisions of our policymak- the future. As a mature industry with a somewhat aging portfolio ers. That said, we are continuing to explore higher priced scratch of products, we are at a critical juncture of needing to focus on games with new themes that will drive sales and revenue. We product innovation, game design, retailer expansion, responsi- are also engaged with GTECH, our lottery operator, to develop ble gambling initiatives and the need to grow a younger player a new licensing model that could allow for the expansion of the base through technology. NASPL must be proactive and stand lottery in Texas into certain “big box” locations. Retailer expan- ready to provide services and educational events that can move sion, in my opinion, is still the low hanging fruit on the path to our industry forward. lottery revenue growth. We have developed sound funding mechanisms for NASPL with Regarding the industry as a whole, obviously the Internet and the addition of Associate Memberships and the “Scoop the interactive markets are critical spaces for the lottery to bein. Cash” initiative. Our education and training events have contin- Obtaining and maintaining a marketing foothold with a younger ued to evolve and now include the Lottery Leadership Institute, demographic is critical to our industry’s long-term viability and the iLottery/Game Developers Conference and the NASPL Pro- these spaces are the key to that initiative. The challenge is to fessional Development Seminar; a host of NASPL committees are develop a platform that will pass muster with state and feder- actively engaged to help guide our future path. The NASPL Ma- al gaming regulators, attract a younger demographic, and yield trix, still underutilized by many of our members, now offers our enough revenue to make the venture profitable for both lotter- industry instant access to NASPL’s comprehensive research and ies and the vendors who will support these systems. Thus far, database information at the click of a mouse. I look back on the the sales velocity for those few lotteries offering products in the history of NASPL and recall the story of those pioneering lottery Internet space has been relatively modest and the industry will directors who decided to get together in a hotel room and create need significant enhancements to these platforms to reach a suf- what is now our association. We owe them a debt of gratitude. ficient level of profitability. Our members will dictate NASPL’s focus going forward. As the And look even deeper – what will the American lottery industry needs change within each member’s jurisdiction, so will the look like in 2064, 100 years after the first lottery tickets were focus of NASPL. I take great personal and professional pride in sold based on the outcome of a horse race? having an opportunity to contribute to the evolution of NASPL as Although it’s difficult to imagine that traditional scratch tickets an Executive Committee member and as President. The next 50 and draw games will still be around in 2064, I tend to believe years promise to be very exciting for our association. they will be in some form or fashion. However, those products INSIGHTS March/April 2014 27

May 18 - 21, 2014 Renaissance Cleveland Hotel Cleveland, OH www.nasplilottery.com 28 INSIGHTS March/April 2014

NASPL iLottery Game Developers Conference

The NASPL iLottery Game Developers Conference will educate the lottery industry on new game design concepts and technologies.

This premier event will bring a host of leading igaming visionaries to the lottery world for an in-depth two-day conference featuring speakers from outside the lottery industry. This event will cover the legal, technological, product development and political issues of game development.

Those attending should expect: • Interactive and informative sessions. • Great networking opportunities. • Learn about current and future federal and state policy addressing digital gambling. • Learn about the social and economic impacts of regulated digital gambling. • The pros and cons of various global regulatory models and considerations for a potential US model. • Existing US prohibition and enforcement mechanisms. • The evolution of gaming products across digital media. • Business, political and regulatory perspectives on the convergence of online and offline gambling. • Regulatory safeguards, such as age verification, fraud detection, geo-location and anti-money laundering. • The debate over state vs. federal policy and regulation. • Examples of regulated US-based Internet gambling. • Responsible Gaming: What are the roles of government and industry in assuring social responsibility, and how are the similarities and differences between online and offline behavior addressed?

Who should attend: • Product Managers • Department Managers • Executives • Anyone in Public Relations, Social Media, I.T., Legal and Marketing www.nasplilottery.com INSIGHTS March/April 2014 29

Conference Featured Speakers

ROBERT TERCEK the competition. His previous books, Gamification by Design (2011) and Game-Based Marketing (2010) have helped de- Robert Tercek’s unique views on fine the industry’s standards and frameworks, and continue managing innovation are sought by to be key reference materials today. Gabe is co-founder organizations around the world. His of strategic consultancy and product lab Dopamine (dopa. motto is “Inventing the Future.” He is mn) where he works with leading brands and startups to passionate about inspiring audiences bring engagement to every corner of their enterprise. Gabe to seize their own destiny by thinking resides in New York City, where he is co-director of startup creatively and taking decisive action. accelerator The Founder Institute, and a board member of His business strategies are informed StartOut.org. by his personal experience as a pioneering executive for MTV, Sony and OWN, and as an entrepreneur in disruptive startup ventures. Throughout his 25-year career, he led teams to RICK MARAZZANI achieve major milestones, including the launch of break- through products on every digital platform. Rob was named Key Account Manager, Games at Glob- one of the “25 Executives to Watch” by Digital Media Wire. al Collect. And he’s also the Founder The Industry Standard dubbed him the “TV Anarchist”. Find and GM of his own game studio, called out why the world’s biggest companies and startup ventures iQ212. rely on Rob’s views to guide them through an evolving com- Rick has been professionally pro- petitive landscape. ducing and designing hit mass-market games for twenty years. He has worked with the biggest brands and franchises in multimedia (SimCity, EA GABE ZICHERMANN Sports, Pogo, The Sims, Pebble Beach, Hasbro, Mattel, Monopoly) and has a stellar track record Gabe Zichermann is the chair of creating successful original IP. GSummit (http://gsummit.com/ June He is a crusader leading the charge to make ALL games 10-13, 2014 in San Francisco) where fun, playable, user-friendly, “mass-market” and ultimately top gamification experts across indus- more profitable. tries gather to share knowledge and Rick’s years of game production experience led to his insight about customer & employee current role as an executive managing the business, licens- engagement and loyalty and the ing, and monetization side of large game portfolios. Founder/Editor of Gamification.Co Rick grew up in Martinez, California and went to college (gamification.co) and EQ magazine. He at UC Santa Barbara. is also an author, highly rated public speaker and entrepreneur whose new book, The Gamifica- tion Revolution (McGraw Hill, 2013 - gamrev.com) looks at how leaders are leveraging gamification strategy to crush 30 INSIGHTS March/April 2014

NASPL iLottery Game Developers Conference

MARCUS KRüGER Media Group. He helped grow the mobile entertainment industry as CEO of Vindigo (fka Zingy) and brokered the first Marcus Krüger is a founder and the Ex- in-game mobile sponsorship in North America while Pres- ecutive Chairman of Goo Technologies ident of NuvoStudios. As a senior executive at Hands-On with the mission to revolutionize web Mobile (fka Mforma), he forged partnerships with leading gaming graphics by making high end game publishers, Activision and EA, branded play compa- graphics creation on HTML5 easy and nies, Hasbro and Mattel, entertainment studios such as Par- accessible through the Goo Engine. He amount and Universal, and media organizations, including leads strategy- and ecosystem devel- CBS, Disney, ESPN, and The New York Times. opment and as a serial entrepreneur He previously drove online innovation by establishing he has been building companies in the a new fantasy sports provider, launching the first internet digital space for the past decade. He film festival with The Sundance Institute, advising clients serves on the board of several companies, speaks at indus- how to extend their brands to the internet as an intellectual try conferences as well as authoring articles in the HTML5/ property attorney, and working in the legal and marketing WebGL space. departments of the Los Angeles Raiders. Jensen has served as co-chair of IAB’s mobile committee, and board member and advisor for early stage companies, agencies, and organizations, including the Game JEAN-ETIENNE BOUEDEC Developers Conference, Mobile Marketing Association, Nielsen, Hiring America, Bertelsmann’s Smashing Ideas, Digital Director, Francaise des Jeux -. Responsible for and Omnicom’s The Marketing Arm. He shares his passions the digital transformation of the Francaise des Jeux , with with his 9-year-old daughter, Heather, who enjoys watching 20 years of experience in innovation and digital marketing. videos on her Xbox One, iPhone and iPad, and often beats him at her favorite games.

SCOTT JENSEN TRACY FULLERTON Scott M. Jensen has been at the forefront of digital media for 20 years, Tracy Fullerton, M.F.A., is an experimental game designer, forging first-of-their-kind partnerships associate professor and chair of the Interactive Media & and launching award-winning products Games Division of the USC School of Cinematic Arts, where to engage consumers across multiple she directs the Game Innovation Lab. This design research screens and devices. center has produced several influential independent games, Jensen served as Vice President, including Cloud, flOw, Darfur is Dying, The Misadventures of mobile and emerging platforms, at P.B. Winterbottom, and The Night Journey, a collaboration Viacom Media Networks, led The with artist Bill Viola. Tracy is the author of “Game Design Weather Channel’s digital apps team, Workshop: A Playcentric Approach to Creating Innovative and oversaw global product marketing efforts for Nokia’s Games,” a design textbook in use at game programs world- INSIGHTS March/April 2014 31

Conference Featured Speakers

wide, and holder of the Electronic Arts Endowed Chair in Interactive Entertainment. Recent projects include Collegeology, a suite of college preparation games funded by the Department of Education, the Gilbert Foundation and the Gates Foundation; Participation Nation, a history and civics game funded by the Corporation for Public Broadcasting and developed in collaboration with Activision-Blizzard and KCET; and Walden, a simulation of Henry David Thoreau’s experiment at Walden Pond. Prior to entering academia, she was a professional game designer and entrepreneur making games for companies including Microsoft, Sony, MTV, among many others. Tracy’s work has received numerous honors including an Emmy nomination for interactive television, Indiecade’s “Sublime Experience,” “Impact,” and “Trailblazer” awards, and Time Magazine’s Best of the Web.

NASPL iLottery Game Developers Conference will take place May 18 - 21, 2014 in Cleveland, OH

iLottery Game Developers Conference

INSIGHTS March/April 2014 33

lot has happened in the last 50 years. Talk about an understatement! The modern lottery industry came to the United States in March 1964 with the launch of the New Hampshire Sweepstakes. A few years later in 1969, amendments to Canada’s Criminal Code legalized gaming activities in that country, and lotteries took hold there as well.

As the industry celebrates the New Hampshire Lottery’s significant anniversary, we marvel at the fact that 44 American lotteries generated $63 billion in traditional game salesA in fiscal 2013, plus another $10.8 billion in receipts from the gaming operations conducted by eight of those lotteries. That activity produced more than $20 billion in net revenues for good causes. Canada’s lotteries produced more than C$8 billion in traditional game sales in fiscal 2013; another C$1.4 billion came from video lottery terminals. Combined, those activities generated C$3 billion in net revenues for the provincial governments.

We asked the four largest companies that serve the lottery industry today to share some of their most significant innovations over the years. The result is the following timeline. Please note that it is not meant to be a comprehensive history of the industry. There are certainly other things that have had helped lotteries over the years – POS materials and marketing tools, for example, that creatively display products at retail. And of course through various mergers and acquisitions, other major companies that served the industry well are no longer around, but they had their own impacts while they were with us. And smaller, younger companies are making their own waves today. For the purposes of this report, we tried to focus on some of the “big-picture” technological innovations that had the most significant overall impacts on the industry, and we also added a few other milestones along the way.

GTECH Corp., INTRALOT Inc., Pollard Banknote and Scientific Games were quick to emphasize that their success, and the industry’s success, is a partnership. It is not about what they have done, it’s about what their partners have done – American lotteries have produced something in the neighborhood of $375 billion for good causes since their inception in 1964, and their Canadian counterparts have generated some C$95 billion.

With all that in mind, here are some of the highlights of the last 50 years. 34 INSIGHTS March/April 2014

1964 1982

The first modern lottery in the The Arizona Lottery launches United States was launched with Scientific Games’ automated the debut of the New Hampshire Tel-Sell marketing system, an Sweepstakes, now known as the innovation that continues to New Hampshire Lottery. The origi- 1973 underscore the importance nal game was based on the results of retail distribution to sales of a horse race, and the first tick- Scientific Games is founded with an al- growth. ets were sold March 12, 1964 gorithmic solution that leads the way for the production and sale of world’s first secure instant lottery game.

1975

The New Jersey Lottery introduces the first computerized numbers game in the U.S. 50 years of Milestones

1974 1978

The Massachusetts Massachusetts and New York Lottery becomes launch the first lotto games in the first lottery the U.S. as offline products. in the world to launch that secure 1970 instant scratch game. The Lottery The first lottery would become an tickets are sold in industry leader in 1976 Canada as lotter- the instant ticket business. ies in Quebec and Gaming Dimensions Inc. was Manitoba open for founded in Providence, R.I., and business. renamed GTECH Corp. when the company went public in 1983. INSIGHTS March/April 2014 35

1982 1985 1986

Canada’s Interprovincial Lottery Corpo- Developed Tri-State Megabucks is the ration and GTECH launch LOTTO 6/49, by Scientific first multi-state lottery the world’s first multi-jurisdiction lotto Games, the in the U.S., with sales in game. industry’s first Maine, New Hampshire and touchscreen, Vermont. The games were self-service promoted at retail with lottery retail Scientific Games’ brand new kiosk sells both centrally-controlled retail instant and communications platform. terminal-based games to Iowa 1982 Lottery players.

Pollard Banknote, which traces its roots as a commercial printer back to the early 1900s, enters the secure lottery ticket printing business by producing two instant tickets for Ontario. 50 years of innovations

1982 1985

GTECH intro- The New York Lottery duces the first and Scientific Games made-for-lottery launch the indus- retail terminal. try’s first Cooperative The company Services Program, an also launches the integrated category Quick Pick option management program for numbers that went on to drive 1986 games, which sales performance for today accounts some of the world’s Pollard Banknote is the first ticket for more than 35 leading lotteries. printer to implement the secure percent of the 1985 placement of the validation number world’s lottery within the game area, replacing the purchases. use of a separate Void if Removed The first lottery-specific com- number box. This innovative munication systems, using radio approach allowed for more space technology, are developed by on the ticket for graphic detail and GTECH. game areas. 36 INSIGHTS March/April 2014

1987 1990

The Iowa Lottery is the first West Virginia begins a limited American lottery to sell pulltab test of VLTs at Mountaineer tickets. Park, the first VLTs located in quantity at a racetrack.

1987 1990

The Multi-State Lottery Association is Pollard Banknote is the first to offer secure formed with six initial members; its first and recyclable card stock, the result of a game, Lotto*America, was introduced proprietary process that utilized a combina- the next year. That game was replaced tion of various solvent-and water-resistant with Powerball in 1992, forever chang- coatings to achieve required opacity on ing the concept of jackpot games. conventional card stock. 50 years of Milestones

1987 1989 1990

The Vermont Lottery is the South Dakota is the first lottery to intro- Sports betting is intro- first to introduce instant tick- duce video lottery terminals (VLTs) at duced in Canada by ets with bar codes, developed bars and clubs the Western Canada by Scientific Games. Lottery Corp. and Loto-Quebec.

1988

Pollard Banknote introduces secure, metalized pouches for instant tickets, which lotteries can use to put together a group of tickets into a high-value package with enhanced graphics. Pouches remain particularly popular in Canada. INSIGHTS March/April 2014 37

1990 1992 1992

Canada’s first video lottery terminals The Texas Lottery Pollard Banknote pioneers a pat- are placed in service by the Atlantic launches with the ented translucent marking system Lottery Corp. in New Brunswick and industry’s first for instant tickets. This concept Newfoundland & Labrador. satellite commu- becomes the lottery industry stan- nications network dard for extended play games. for retail lottery terminals, provided 1991 by GTECH.

The Oregon Lottery and GTECH introduce Club Keno, the first such game in the country.

50 years of innovations

1991 1992 1995

The Virginia Lottery begins the With its debut, Texas The Maine Lottery is first large-scale installation of also introduced a new the first to use Scientific instant ticket vending ma- lottery model, out- Games’ new one-step, chines. sourcing its marketing automated keyless game and sales functions validation process. to a private company (GTECH). It would be almost two decades before other lotteries followed a similar path of significant outsourc- 1991 ing (Illinois, Indiana and New Jersey). 1993 The Atlantic Lottery Corp. and Scientific Games introduce the industry’s first Bingo scratch game with Loto-Quebec becomes the first North a player marking system. Printed on an oversized American lottery operator to open a ticket with a complex play style and offered at a casino. By 2014, 13 lottery organizations higher price point, this launches the extended play in the U.S. and Canada were involved in product category for lotteries. casino-style gaming in some fashion. 38 INSIGHTS March/April 2014

1998 2000

The New Mexico Lottery is the The Iowa Lottery is the first to utilize a 100 percent first American lottery to 1996 wireless lottery network, offer a computer-based created by GTECH. game in conjunction with a scratch ticket; The Big Game is introduced by several large the CD-ROM game was states in order to offer mega-jackpots on developed by Ingenio. the order of Powerball. It became Mega Four years later, the Millions in 2002, and that game currently New Jersey Lottery and holds the record for the world’s largest lotto Scientific Games intro- jackpot at $656 million. duced Cyber Slingo®, the first scratch game in the U.S. to offer an In- Scientific Games de- ternet play component. velops technology that 1996 offers an additional level of game security by concealing validation bar codes under the scratch-off coating. 50 years of Milestones

1998

Loto-Quebec creates Ingenio, an innovative and creative research and development subsidiary specializing in interactive game development.

1997 1999 The Nebraska Lottery’s Wheel of Fortune® Pollard Banknote is the first 2000 game is the industry’s first licensed game company to offer a scratch- promotion offering branded merchandise off play area on both sides and experiential prizes, provided by Scien- of an instant lottery ticket, Pollard Banknote develops a laminated tific Games. which allows increased play Fusion® product line that includes differ- opportunities without an ent ticket alternatives for increased play increase in ticket size. opportunities and game styles. INSIGHTS March/April 2014 39

2000 2004 2006

GTECH develops ES-VIDEO, The Atlantic Lottery Corp. and Pollard Banknote patents its Scratch FX® tech- the first VLT central system the British Columbia Lottery nology. To this day, all ticket vendors continue to capable of downloading. Corp. are the first lotteries in develop new printing technologies and enhance- North America to offer Internet ments that attract players to the games. sales.

2003

Pollard Banknote introduces the PlayBook®, which provides enhanced extended play opportunities with multiple different game formats within a single book. 50 years of innovations

2002

European-based INTRALOT enters North American lottery systems market by establishing INTRALOT Inc, in Duluth, Ga. It allows three strong companies to serve the 2006 American market, fostering competition and innovation. Scientific Games launches the industry’s first retail development program, which helps retailers increase lottery game sales with 2004 best practices and merchandising programs.

GTECH introduces lottery digital signage, leveraging existing lottery infrastructure to deliver marketing information and 2006 keno game content to retailers. Fully integrated digital signage The Multi-State Lottery Association and SPIELO (a rapidly became an industry division of GTECH) launch the first multi-state video standard. lottery progressive in Delaware, Rhode Island and West Virginia. 40 INSIGHTS March/April 2014

2007 2010

West Virginia becomes the first North America’s first reg- U.S. lottery to introduce table ulated online poker net- games in addition to video lottery work, The Canadian Poker terminals. Network, is launched by Loto-Quebec and GTECH. The British Columbia Lottery Corporation joined the CPN 2007 the next year. 2011 Scientific Games develops the lottery industry’s first linked multi-state in- Lotteries begin to embrace stant game, Deal or No Deal™, which the mobile world, as the involves 21 states and offers lotteries Iowa Lottery and Scientific exclusive, one-of-a-kind prizes and Games launch the indus- marketing packages. The winners try’s first iPhone® mobile appeared on national television two app that checks tickets and years later. creates electronic bet slip for use at retail. 50 years of Milestones

2007 2010 2011

The Idaho Lottery and INTRALOT begin For the first time, American In another mobile-based develop- an industry-first VIP Club to award lotteries could sell both ment, Pollard Banknote develops a players points at the point-of-pur- Powerball and Mega Millions system for using QR codes on instant chase terminal. tickets, a landmark achieve- tickets that can be scanned by smart- ment in the industry. phones.

2011

Scientific Games develops a Wheel of Fortune® linked instant game with the industry’s first tie-in to a Facebook social game. INSIGHTS March/April 2014 41

2012 2013

Illinois becomes the first American The California Lottery introduces the first lottery to offer regular ticket sales via second chance solution to include both 2013 the Internet with a system developed instants and terminal-based games. by GTECH. A few other lotteries had The Georgia Lottery is the already been offering subscription first American lottery to offer services through the Web. keno games via the Internet.

2012 2013 The New Mexico Lottery’s version of terminal-based in- Scientific Games creates the industry’s first stant-win games, Quicksters, multi-state linked instant game, MONOPO- are the first such games to LY™ Jackpot, with second-chance opportu- be sold through self-service nities to win progressive jackpots of up to vending machines, utilizing $1 million or more. INTRALOT’s WinStation.

50 years of innovations

2012 2013 2014

The Minnesota Lottery The DC Lottery and The Illinois Lottery, using GTECH technol- launched a combined INTRALOT launch ogy, launches America’s first lottery app Linq3 and Scientific Games innovative Tap and that allows players to purchase tickets solution to become the first Play games, the first using their mobile phones. lottery to sell tickets at gas interactive lottery pumps and ATMs. games played on a player-operated retail lottery terminal. 2014 2013 The Minnesota Lottery in conjunction with technology partner Scientific The Delaware Lottery is the first Amer- Games becomes the first American ican operator of any kind to introduce lottery to sell eInstant games. casino-style Internet gaming, using a system developed by Scientific Games and 888 Holdings. 42 INSIGHTS March/April 2014

A look at the next

years

We’ve looked at the first 50 years of the American lottery industry; now it’s time to look forward to the next 50 years. We asked the same four vendors for their vision of the future, perhaps even speculating on the industry’s 100th anniversary in 2064. We also asked lottery directors to look into their own crystal balls, and we received some very creative responses to the question of what the industry might look like in 2064. From all appearances the lottery 50industry, which relies on creativity, is in good hands. INSIGHTS March/April 2014 43

Jim Kennedy, Executive Vice President and Chief Executive, Lottery Group, Scientific Games

It may be easier to predict the future in 50 years than in five years. The way I look at this is through the lens of history and human behavior. I look into the future and think about what doesn’t change as much as what might change? When I was at the European Lot- teries conference in Israel last year, I traveled to the Sea of Galilee and had the extraordinary experience of touring the Roman ruins. I snapped a photo of an ancient game board that is carved into the marble of the ruins and I look at it often on my iPhone. The photo reminds me that as far back as the beginning of civilization, people liked to play games. It’s at the core of human nature. Games challenge us and connect us socially. Games with novelty and intrigue capture our attention and keep us entertained. In 2064, we will still be playing games.

In 50 years, lottery will continue to bring people together. The core of the entire concept of lottery is to leverage a little to get more and this requires social groups to support the pool. Lottery is one of the oldest forms of social media and will only accelerate as people easily connect around the block and around the world.

Trust will remain a fundamental determinate of success. To really enjoy a game and keep coming back to play again, people have to fully trust that the game is fair. Trusted brands will become even more important in a fast-moving world.

As technological advancements continue at an incredible pace, I Jim Kennedy, Executive Vice President believe we’ll see greater, and more convenient, access to lottery game products in a more real-time way. Depending on how you can and Chief Executive, Lottery Group, imagine technology fast-forwarding 50 years, games could be avail- Scientific Games able through external devices, technology connected like a pros- thetic to the human body, an organic software implant or eyewear. Futurist Ray Kurzweil’s concept in his book, The Singularity is Near, may find all of us embedded into technology – or maybe the other way around. So, convenient, protected access to player designed From a game carved into content will provide a rich environment of choice. the floor of Roman ruins, For more than 300 years, lottery has played a significant role in American history. Lotteries funded the settlement of the James- to a game imbedded into town colony, the construction and development of some of our most prestigious universities, landmark buildings, and infrastructure in our cities such as railroads, bridges and transportation sys- our collective technology, tems. Over the past 50 years, lottery has developed even further with more targeted funding for education, the environment and I think people will always senior citizens. As we look to the future, I think this trend will continue and lottery will move from broad program-based funding to support the games they micro-targeted funding. Lottery’s role will always be to protect and entertain the people that use the products, and provide targeted find exciting in an use of benefits from those products. environment they can Looking forward begins with the things that are timeless: social groups, novelty in games, trust, the desire to leverage a little to get trust. a lot, the use of technology for convenience and access, and the foundation of lottery being a philanthropic funding mechanism. 44 INSIGHTS March/April 2014

From a game carved into the floor of Roman ruins, to a game imbedded into our collective technology, I think people will always support the games they find exciting in an environment they can trust.

John Pittman, Vice President of Marketing, INTRALOT Inc.

The lottery industry is facing both increased challenges and a wealth of opportunities. Regulatory initiatives, technological convergence, new business models and the need to attract new customer demographics all set the pace of change and the pillars of very interesting developments. By leveraging the industry’s intrinsic values of contributing to society, preserving and promoting responsible gaming practices, and the awareness and trust of the brands, lotteries have unique advantag- es to compete in an open market across the globe.

Traditional lottery games played at traditional retailers are the back- bone of our industry and are not going to go away, but there will be an “expansion” of traditional lottery to keep up with the trends players are seeing from other industries.

We are already starting to see a shift in the desires of players. We are seeing a trend toward self-service terminals and instant-gratification games played in new and exciting ways. Players are downloading appli- cations that allow them to interact with the lottery in an untraditional way. This trend will continue as players get more and more exposure to John Pittman, Vice President lottery in ways that are new to our industry. of Marketing, INTRALOT Inc. Unique delivery methods of traditional games as well as non-traditional games will be become available to players in ways that interest them and that they are accustomed to seeing from other industries. Mobile devices will become an essential delivery method for information, marketing materials and games, leading into the need for player accounts. Lotteries This is standard for consumers today and will be a necessary next step will become for lotteries. Once we have player accounts, we can really get to know our customers and cater to their needs as consumers. Game content will need diversified to be changed constantly and customized to individual players. Lottery will become much more flexible for players and much more personal. Once lottery is personalized it will become very dynamic. We will need in their selling to keep up with our players and their desires for how, what and when they play. channels and Lotteries will become diversified in their selling channels and inthe games they provide. We only need to look at how our traditional retail- in the games ers as well as our competition in gaming have evolved in an effort to meet and the needs of their consumers to see our future. Our partners and our competition have gotten personal with their customers and they provide. we will need to adopt that level of personalization – rewards, points, special offers and cross promotion all specialized for the consumer and delivered to them dynamically and specifically. INSIGHTS March/April 2014 45

We have been analyzing the patterns and the drive behind the purchasing decisions of lottery players, and have come to the strong belief that the centuries-old traditional lottery products touch upon fundamental human needs of luck and entertainment that can now greatly be enhanced, augmented, changed and reshaped to form a very interesting and valuable new proposition. We believe in the emergence of the New Lottery, and we are enthusiastic to plan ahead with our partners towards the realization of this vision.

Doug Pollard, Co-Chief Executive Officer, Pollard Banknote

• Traditional lottery games have enduring appeal and willcon- tinue to meet the same underlying needs of consumers. Since lotteries began, the desire for entertainment, diversion, distrac- tion, and participation in a game of chance hasn’t changed in fundamental ways, and this need will remain into the future.

• There is an ever-increasing need for revenue for good causes supported by lotteries worldwide. This reality underscores the necessity for innovation to keep pace with changes in the marketplace.

• Consumption patterns are evolving. The marketing, distribution, and format of games will also evolve to better adapt to changing consumer behavior. Responding to consumer demand and understanding those rapidly evolving patterns of consump- Doug Pollard, Co-Chief Executive tion will be key to each lottery’s success. Officer, Pollard Banknote • The lottery ecosystem is made up of a network of interactions across channels: retail and online interactive channels, and the “space between” these channels. Retail and interactive strategies are critical components of a cohesive whole, and can be viewed as existing on a continuum where interactive channels Consumption patterns strengthens the retail component. are evolving. The • Retail will remain a vital channel of distribution, and we will continue to develop new retail initiatives that provide added value to lottery retail networks. The physical “packaging” of our marketing, distribution, products will have to stand out against the backdrop of other fast moving consumer goods. and format of games • Lotteries will expand their presence in areas where there is more intense competition, such as the interactive and social will also evolve to spaces. We will have to gain a better understanding of players, to be able to offer relevant, customized products made possible better adapt to through the acquisition of CRM data as play becomes less anon- ymous. changing consumer • We’ll be able to improve game content delivery for greater convenience to satisfy the “consumer on demand” culture, provide behavior. added value, and offer more sophisticated retention strategies. 46 INSIGHTS March/April 2014

• Player acquisition will look very different in the future – reaching new markets is becoming increasingly more difficult. By better understanding what triggers that first purchase, and discovering what new players like and dislike, we’ll be more successful at building effective strategies and tactics that expand our player base and appeal to those elusive emerging markets.

Paul Riley, Vice President of Product Marketing, GTECH Corporation

In the short term, I’m quite bullish on the interactive space. Technology is increasingly pervasive – beyond mobile devices, it’s rapidly extending into our cars and our homes – and we will always be connected. The pervasiveness of the Internet, combined with strong adoption by consumers, is going to make the interactive channel just keep growing. And for the lottery industry, that channel holds a lot of promise, particularly in the U.S., which is just starting the down the path.

The American pioneers in the interactive space – Illinois, Georgia, Min- nesota, Delaware – are proving that we can get good results generating incremental sales without negative impacts on our retail sales, and that we can exercise technology and tools to grow in a responsible fashion. We’ve seen those same results internationally but now it’s starting to establish itself in the U.S. And with those results, I think more jurisdictions will adopt legislation to allow lottery sales through interactive Paul Riley, Vice President of Product channels. It’s just a logical imperative – it’s the way people consume in today’s world. Marketing, GTECH Corp. I also see changes coming in how lotteries work with retailers. Smaller mom-and-pops continue to be on the decline, with the big box retailers accounting for more and more sales. These big retailers put much Anywhere more pressure on our industry to conform to their unique business and operational needs, and it has been difficult for the lottery industry to accommodate them. I see an urgent need for us to provide ways to add you can buy lottery capabilities to these companies’ existing infrastructures. We need to conform to what they want, or we will miss the boat.

consumer The lottery-retail business model itself is also evolving. Lotteries have always provided retailers with the necessary equipment to sell lottery, but I can see that changing in the coming years. Perhaps a “bring your products right own device” strategy that could help us bring in smaller retailers. We could provide them the software that allows us to securely process transactions on their own devices. The larger retailers, those who drive now, you will most of the sales, would continue to be equipped with dedicated lot- eventually tery equipment, but a newer model would benefit everyone else. Looking further down the road, I think that lottery games, in terms of distribution, will be ubiquitous. Anywhere you can buy consumer prod- be able to buy ucts right now, you will eventually be able to buy lottery games, and that particularly includes the huge eCommerce sites that most of us use today. Who knows if we will even still be producing paper tickets – lottery games... it may all be done electronically, but it doesn’t really matter. INSIGHTS March/April 2014 47

As part of this “ultimate distribution” model, borders will do, you can emphasize that any purchase will come back fall and it will be a global marketplace. Consumers will to benefit the consumer as a citizen of a particular jurisdic- be able to buy whatever lottery product they want from tion. That’s a powerful message. anywhere. The world is getting to be a smaller and smaller place, and globalization extends into commerce and I In the end, lotteries are an entertainment experience. I’ll think it should extend into our entertainment experience go one step further to say that lotteries will ultimately as well. That does mean that lotteries will have more pres- weave our experiences into other virtual worlds out there. sure to build their brands. There will always be people who We can place ourselves in virtual environments and add to are going to chase the best deal, but I don’t think brand their entertainment value – imagine a lottery stand in the allegiance is something that’s going to go by the wayside. virtual Grand Theft Auto world of the future. Anything is If you have a good strong brand, and I think most lotteries possible.

Attention NASPL Associate Members – Share Your Vision! Do you have something to say about the future of our industry? Help Insights continue its celebration of 50 years in upcoming issues by providing us with your ideas about what the future will bring. Send your contributions to Patricia McQueen, [email protected]

Let’s hear from the Directors...

Gerry Aubin, Director, Rhode Island the phone so we surprise the winner, rather than wait for them to check their ticket and come in to claim. Lottery • Instant tickets will be holographs, rather than physical tickets. Fifty years from now? The only • Since everything will be through mobile phones, we’ll be thing I am fairly certain of is that able to record people scratching tickets to capture their I won’t be here! Certainly it is fun reactions, so there will be no anonymity. to imagine all the possibilities the • There will be a world lottery game with people from every future might hold for our industry. I country able to play. came up with a few futuristic ideas • We’ll be able to change where the money goes with more on my own, but, as they say, “with ease, and have it fund bigger worldwide causes, like global age comes wisdom,” so tapping into warming and world hunger, so playing the lottery becomes my “wisdom” I asked some of my something everyone feels the need to do. younger staff members to look into • Your eyeball will be scanned when you claim a ticket to their own crystal balls and tell me verify you are the winner. what they saw. Here are some of • Social gaming will be more prevalent, where you play their predictions: against each other, or if you win, so do other people who are in close geographic proximity (like everyone living in • There won’t be any physical cash exchange for tickets and your community) or whoever bought tickets from the same prizes, it will all be through your account online or through location or at the same exact time. a scanner on your phone. • Billion dollar jackpots will be old news and experiential • Paper tickets won’t be in existence, and we’ll be able to prizes will include a trip around the world or to the moon track who the tickets belong to through GPS tracking on and back. 48 INSIGHTS March/April 2014

• Lottery purchases can be programmed to be included in Carole Hedinger, Executive Director, every day purchases, so whenever you get gas or buy grocer- ies or coffee, a lottery ticket is automatically added to your New Jersey Lottery “shopping cart.” • Like a Facebook account that manages social activity, we As you know, Madame Carole can may all have a government issued account (through our predict the future as evidenced last social security number) in which all of our financial trans- October when she predicted lottery actions are managed (purchases, banking, retirement) so directors, staff and vendors will you’d see your lottery funds in your account and be able to gather in Atlantic City on Sept. 30, transfer money or money towards games to other people’s 2014, to attend the NASPL14 annual accounts if you want to give a gift. conference. I consulted with her and • Playing the lottery could become government mandated she predicted that within the next 50 (with a cap on how much an individual can contribute). years Google Glass will have come and gone – replaced by the “Brain Bit” and people will play the lottery by simply thinking of the game and Gardner Gurney, Acting Director, Division of numbers they want and it will hap- the New York State Lottery, New York State pen! They will mentally transfer payment to the lottery and will receive the results by neuron transfer. There will even be a way Gaming Commission to do this while dreaming...and the first “dream winner” will be announced – which is why the New Jersey Lottery coined the • Over the next 50 years, we will see phrase “Give Your Dreams a Chance” more than a decade ago in a multinational game with a trip into anticipation of the future. space and back as a prize. • There will be virtual-based lottery games with holograms as drawing hosts and experiential prizes that are Michael Jones, Director, Illinois Lottery presented holographically without need for actual travel. In the year 2064, lottery play is man- • Perhaps there will be a prize datory from eighteen years old on. whereby if you win, someone else or Play relates to causes as each lottery a robot has to do your job until your is beneficiary-based. State and nation- expected retirement date. al lotteries no longer exist. The United • A physical book of instant tickets Nations Lottery Group (UNLG) grants will be more likely to be found in a museum than in a con- licenses to nonprofit groups who venience store. Convenience stores? Won’t things just show must prove a minimum 15 percent up at your residence? When you imagine you need a cup market niche of support worldwide. of coffee, it just appears, or perhaps you drink it virtually, Ticket prices and weekly play are set the need subsides and your bank account is automatically by income levels. Only virtual games reduced. And surprise – that lottery ticket you just dreamed exist, as paper and terminals have of was a winner and your account has an automatic deposit! long disappeared. Marketing must be • There will be an opportunity to buy a lottery game or cause-related and the Batchy Awards porto+cast generates a subscription when you do your taxes (those never go away, larger viewing audience than The Oscars webinar. An avatar of right?) and you can be automatically entered into a drawing Joan Rivers (who died at 132) leads The Fashion Police’s cover- to have next year’s taxes paid in full or this year’s tax refund age of the latest in lottery wear among the UNLG’s 75 Executive doubled. Vice Presidents on the night following the Batchy’s. • There will be an interactive game whereby you select your wager amount and the specific prize you are playing for, and Executive Vice Presidents of the UNLG are lifetime, hereditary the prizes are not typically cash. Perhaps the prize you play positions. Members are chosen from descendants (DNA testing for is gifted automatically to someone else, who may or may is mandatory) of the most distinguished group of lottery experts not be known to you. Perhaps a third world town receives a ever assembled: the NASPL Directors in office on March 10, flock of sheep. 2014. They are compensated with commissions on profits and • Lotteries will have more competition in the market area for receive ample benefits including golf lessons. gambling and will be competing for totally new entertainment and opportunities for the use of discretionary income - things that many of us would never have imagined. Items and experiences that now seem so far out of our reach or reality will be commonplace and other spending pleasures will come, be gone and already seen as old and boring. • Prizes will not be self-centered. INSIGHTS March/April 2014 49

Paula Otto, Executive Players will also be able to play more than one game on these Director, Virginia Lottery “instant video” or virtual tickets. They will eventually expire and Here’s what I know for sure about need to be returned for recycling 2064: People will still enjoy games back into a new ticket. of chance. Governments will still • It is likely there will be a class need gaming revenues to balance of games with a virtual reality their budgets and support import- component, involving glasses that ant causes. People will still trust the transport the player into a virtual government to run fair games and video game world or casino of will spend their dollars (or bitcoins some sort. The possibilities are or whatevers) on games that support endless: you could play a game with Frank Sinatra, Albert government services. Einstein or George Washington! • Lottery games, sports betting and casino games will be avail- Here’s what I imagine: We will be a able over this “ultranet.” nearly paperless society by then, so • There will be all types of private companies and quasi-gov- the majority of gaming will be done electronically. Where will we ernmental agencies running these lotteries and betting play the lottery? On our television? Computers? Smartphones? games, which will drive innovation. Will we even have any of those devices? Most folks will probably • Draw games will also be a complete entertainment experi- be wearing their devices and we won’t need keyboards…our de- ence. For example, a virtual reality “Cadillac” game could vices will know what we’re thinking and answer our commands. involve a driving experience or even their new flying car, From my rocking chair (I’m counting on good medicine, since I’ll which you could win in the game. be 103 in 2064) I’ll be buying Virginia Lottery tickets by pulling • Scratchers will always be an impulse item. up a screen on my glasses and using my PayPal account to get in • There will always be bricks-and-mortar retail locations, the Billion Dollar Jackpot Game! Sounds like fun to me. though they may be different. Retail locations will still be the biggest sellers of these new products, but there will be more self-service options and near-instant delivery methods (i.e., May Scheve Reardon, served in less than 10 minutes or your next ticket is free). • Lotteries will all sell over the Internet or “ultranet” and Executive Director, Missouri Lottery through multiple channels like Smartphones, tablets and other devices. I surveyed some of my staff, and we have this collective vision • There will be very little, if any, cash used 50 years from now. for the future: Transactions will take place via encrypted transfers from a personal phone or device to the retail or ticket selling loca- • There will always be paper-like Scratchers tickets, and most tion, or they may possibly take place though a POS device likely they will be some type of 100-percent recyclable resin, using a fingerprint or retina scan. in place of latex. They would have a thin coating of this resin • It’s possible there will be one or more national or worldwide embedded with an ultrathin digital monitor, and you would lotteries, which will mean more direct competition. play the game like a hand-held video game. Players will play • Group play will be more prevalent through social media the games over a wireless “ultranet,” a new super-Internet channels. that provides a secure wireless connection from anywhere. What will the next 50 years bring us? 50 INSIGHTS March/April 2014

The November/December issue of Insights featured a gallery of holiday tickets from a number of North American Lotteries. Once again we have asked these lotteries to wrap up their experiences during the holiday season – what worked, what didn’t work, and how they will plan for holiday 2014. Their responses follow, as compiled by staff writer Patricia McQueen in early February. INSIGHTS March/April 2014 51 52 INSIGHTS March/April 2014

Arizona Lottery

Arizona’s holiday lineup included five games: Two at $2 and one each at $1, $5 and $10. Most successful game(s): We actually consider all our holiday games a success. The $5 game sold out the quickest but all our games sold 80 percent or better. General holiday strategies: For the last several years we have offered holiday games at the $1, $2, $5 and $10 price points. We typically look for lighter-themed games at the $1 and $2 level, and we offer a $2 holiday crossword. The higher price points have some extra “bling” such as the Pollard FX or printing the ticket on foil or holographic stock. The goal is to give them a richer look. Our games are introduced the first week in October and we plan for them to be in market 12 weeks. This year we didn’t support the games with TV advertising. We also had limited point-of-sale and no sales rep incentive. Major lessons learned in 2013: One thing we didn’t plan for this year was a family of games that were introduced in July and which were still selling strong when it came time for the holiday games. This caused some delays in getting the holiday games displayed in all retailer locations. Next year we will make sure we have planned a better placement strategy for the holiday games. We will definitely create some kind of sales rep incentive program for the holiday games next year.

British Columbia Lottery Corp.

BCLC’s holiday lineup included nine games: Two each at $2, $3 and $5, and one each at $1, $10 and $20. Most successful game(s): The introduction of a $20 Holiday Gift Pack was the most successful aspect of our campaign. Pre-buybacks, it was our highest (gross) selling ticket. General holiday strategies: A learning from FY13 was that high price point tickets were key growth drivers, so this season we introduced a new $20 Holiday Gift Pack and also launched an additional $5 holiday ticket (replacing one of the $1 holiday tickets), increasing our holiday lineup to nine tickets from eight. Additionally, we launched three of our holiday tickets in October this year, whereas last year we only launched one in October. Otherwise, the duration of time our holiday tickets were in market was unchanged from FY13. Our mass media campaign and promotional support included advertising with out of home elements, radio, print, online and point of sale support. We also worked with some of our key retail accounts and implemented account-specific initiatives. Major lessons learned in 2013: From a social media engagement and fan acquisition perspective, our Tech the Halls contest was a major success (this is also reflected in our ticket sales). However, participation rates declined as anticipated during this second year of the contest. Looking ahead, we are conducting research to come up with ways to rejuvenate the contest and keep it exciting for our players to drive participation rates. INSIGHTS March/April 2014 53

Delaware State Lottery

Delaware’s holiday lineup included two games: One each at $1 and $2. Most successful game(s): Both were successful. General holiday strategies: In previous holiday seasons, the Delaware Lottery launched holiday/seasonal tickets and its holiday campaign in October and sales were slow until Thanks- giving. This past holiday season, the Lottery changed its game/campaign launch month date from October to November. We launched the tickets with POS in No- vember and the holiday campaign began Nov. 25 and ran through Dec. 29, 2013. The bulk of our holiday ticket sales are from Thanksgiving to New Year’s. Players are no longer interested in holiday tickets after the New Year. Holiday tickets hold real estate in dispensers for a short period of time. Major lessons learned in 2013: We won’t do anything different as far as game/campaign launch; however, we will increase our ticket quantity.

Florida Lottery

Florida’s holiday lineup included five games: Two at $2 and one each at $1, $5 and $10. Most successful game(s): Of the Florida Lottery’s five holiday-themed Scratch-Off games launched in 2013, the $5 game Holiday Gift was the most successful. With four colorful scenes and top prizes of $250,000, Holiday Gift sales were 24 percent higher than the previous year’s $5 holiday-themed game. Although 2012’s $5 game HOLIDAY MAGIC also offered top prizes of $250,000 and sold well, we believe that the four colorful scenes appealed to a wider player base, resulting in higher sales. General holiday strategies: Our holiday product strategy stayed relatively the same in 2013. We launched five holiday-themed games, ranging from $1 to $10, in late October. Our product strategy focused on attracting a wide player base with money-themed tickets, multiple scenes and fun alternatives. We also launch “bridge games” in December to augment our holiday lineup while also selling throughout the winter months. We promote our holiday games with a full assortment of TV, radio, Internet and OOH advertising, as well as point-of-sale signage and material. This year’s advertising campaign focused on marketing holiday tickets as an add-on, or complementary gift, making any gift better with the addition of a Florida Lottery Scratch-Off ticket. Lastly, we offered a social media contest via Instagram, where players had the chance to win free tickets by uploading pictures of themselves having “ho lotta” fun with HO-HO-HO LOTTA CASH Scratch-Off tickets. The contest served multiple purposes including driving sales, increasing the Lottery’s audience of followers on Instagram and created awareness of our holiday Scratch-Off games. In total, our 2013 holiday games sales increased 17.5 percent over 2012’s holiday games. Major lessons learned in 2013: The success of our 2013 holiday games campaign reinforced our belief that holiday games are a great opportunity to engage current players and attract new and former players by offering games that appeal to a diverse player population, include multiple colorful scenes and are supported by a comprehensive marketing plan. 54 INSIGHTS March/April 2014

Georgia Lottery Corporation

Georgia’s holiday lineup included four games: One each at $1, $2, $5 and $20, plus a gift pack. Most successful game(s): We introduced a $1, $2, $5, $20 and one $20 gift pack for the holiday season. As a whole, the games performed slightly better than the previous year’s holiday offering. Individually, the games performed lower than their comparable price points the prior year. General holiday strategies: We introduced the “X The Money” holiday product line, which is an extension of one of our two most popular scratcher families. We printed on foil specialty paper to create a more premium look and feel. Additionally, we introduced a Jumbo Bucks gift pack that contained five $5 scratchers for $20. This was a value proposition positioning which was developed for players as a gifting option for the holiday season. The family of products was advertised on TV, radio, as well as POP at retail. Major lessons learned in 2013: This year we launched a different family of games, and it wasn’t as well received as the transitional Jumbo Bucks product line holiday extension. We have learned that players look forward to certain things every year and that we must balance innovation with player expectations.

Hoosier Lottery

Hoosier’s holiday lineup included four games: One each at $1, $2, $5 and $10. Most successful game(s): The Hoosier Lottery launched four holiday themed Scratch-offs this year and we were very pleased with sales, as each performed well above their average price point. General holiday strategies: We launched our four games on Nov. 5, 2013: $1 Holiday $50s, $2 Holiday Winnings, $5 Year End Bonus and $10 Million Dollar Holiday. The most significant change in strategy this year was the offering of a $10 holiday game and the launch of the Million Dollar Holiday Giveaway 2nd Chance Promotion supporting both the $10 and $5 holiday Scratch-offs. The strategy behind launching a $10 holiday themed Scratch-off was to leverage the holiday theme to introduce more players to the price point, and it worked! Sales of the $10 Million Dollar Holiday were greater than we expected with an index 113 at week eight. The 2nd Chance Promotion was also a success, generating nearly 300,000 entries in the busy November and December holiday season and considerable chatter through social media. All holiday games were supported in our “Spread Cheer” campaign through mass media, in-store, social and digital channels. This campaign promoted giving Scratch-offs as gifts to adults and highlighted the holiday themed Scratch-offs as well as a few other player favorite Scratch-offs like $2 $1,000 a Week Cash for Life. This was our most successful December with three of our top six sales weeks ever occurring in December 2013. Major lessons learned in 2013: The Hoosier Lottery will leverage much of this year’s holiday success in 2014 including leveraging the holiday theme to introduce more players to a price point or category and offering a holiday 2nd chance promotion. We will adjust order quantities to ensure we have enough each price point. INSIGHTS March/April 2014 55

Iowa Lottery Authority

Iowa’s holiday lineup included ten games: Three at $2, two each at $1, $3 and $5, plus one at $10. Most successful game(s): Over the past couple years, our most successful holiday scratch games have become the special holiday versions we’ve released of both Crossword and Bingo. Those games are two of our most popular throughout the year, so we anticipated that holiday versions of them would do well, too. Our players now know to look for the holiday edition of those games. They respond very well to these “limited edition” versions and also know that our traditional Crossword and Bingo games will be back on the market in January after the holidays. General holiday strategies: This year we used “retro” colors and designs for all our holiday games, giving them a consistent look and feel but with some notable differences as well. We have been offering holiday-themed scratch games at each price point up to $10 ($1, $2, $3, $5 and $10), which gives our players a lot of variety – the same important component we emphasize throughout the year. We normally launch our first set of holiday games in early October with a second round of games launching in November. We leave the tickets out until early January, and then remove the holiday games from sale when we release our next round of traditional games in January. We pur- chased enough inventory in our holiday tickets to ensure that all 10 games were available during the entire season. We traditionally support our holiday selection with a promotion and advertising. We’ve continually built upon our previous holiday successes and our players now know to expect a special promotion with multiple prize categories based upon the price point of the tickets they enter. Major lessons learned in 2013: We tried something completely new for the 2013 holiday season and are really happy with its results. We’re now looking for more opportunities during the year to try it! For the first time, we launched a holiday-themed ticket in September 2013 that included pulsed changes to its artwork. The $2 game started with a Halloween theme under the name Scary Money; it progressed to a turkey theme with the Turkey Day Doubler name for Thanksgiving and finished with a gift theme and the Holiday Package name in Decem- ber. There was a universal look to each round of artwork in the game – the characters featured on the tickets all had a fun “googly eyes” expression. Our players responded very well to each pulse change and we received positive feedback about the ticket art. It’s a challenge to keep the inventory balanced so the featured ticket artwork pulses at the appropriate time, but I think we did a good job of forecasting quantities to achieve those pulse changes. We enjoyed the challenge of managing such a tight schedule and plan to bring it back next year. We’re also thinking about other holidays during the year when the pulsed-design approach could work, like a game that would feature different ticket art for New Year’s Day, Valentine’s Day and St. Patrick’s Day.

Kansas Lottery

Kansas’ holiday lineup included five games: Two at $1 and one each at $2, $5 and $10. Most successful game(s): Our $5 So Many Santas sold over 90 percent and was done on Pollard Scratch FX paper. Our $1 Secret Santa sold over 90 percent and sold well probably because of the price point. General holiday strategies: For 2013 we went with cute humor and less traditional themes. Our tickets launched Oct. 1 and sold through Jan. 31; the $10 game was a relaunch from the previous year. We did a “Jingle Sales” incentive with retailers as part of our promotional support. Major lessons learned in 2013: We haven’t really done any analysis or evaluation since tickets are still in the field at this time. We get the sense that we won’t be doing a $10 holiday ticket next year and will be adding a holiday bingo back into the mix. 56 INSIGHTS March/April 2014

Maryland Lottery

Maryland’s holiday lineup included five games: One each at $1, $2, $3, $5 and $10. Most successful game(s): In 2013, the Maryland Lottery launched a Tech The Halls family of games. The family consisted of tickets priced at $1, $2, $3, $5 and $10. Over the holiday season, we also did a soft relaunch of holiday tickets from the previous year. The Tech the Halls sales were two percent higher than the prior year’s holiday tickets. After including the sales figures from the relaunched holiday tickets, 2013 holiday ticket sales were up by 15 percent. General holiday strategies: This year, we took a new approach with Tech The Halls family of tickets. Each price point could be entered into My Lottery Rewards, our player loyalty program, to win a different Sony electronic item. We gave away 30 of each of the following, for a total of 150 prizes: HDTV, laptop, tablet, headphones and cam- era. Promotional support included television and radio advertisements. Holiday games were also promoted in retailer locations using point-of-sale and LIM (Lottery in Motion) monitors. A big difference from 2012 to 2013 was that there was no second-chance opportunity available for holiday-themed tickets in 2012. Major lessons learned in 2013: We feel as though the Tech The Halls second-chance contest was very helpful when it came to obtaining new players in our player loyalty program. Next year, we would like to look into some different prizes and will likely return to the traditional holiday-themed tickets.

Massachusetts Lottery

Massachusetts’ holiday lineup included five games: Two at $2 and one each at $1, $5 and $10. Most successful game(s): Of our five ticket holiday release, the “hero” of the group would be the Holiday Gold instant ticket. The $10 game tested extremely well in focus groups and sales-wise performed to our strong expectations, ringing in $61.4 million since its release on Oct. 29. We believe its rich graphics, play mechanics (a key number match and three multipliers - 2X, 5X and 10X), and $2.5 million top prize (three total) appealed to holiday gift givers, as well as regular lottery players. General holiday strategies: The theme of our 2013 holiday strategy and supporting marketing campaign was an extension of our “Shop Once, and Shop for All” messaging created/launched the previous year, which positions Massachusetts Lottery instant tickets as the perfect easy-to-buy gift for everyone on your holiday shopping list. Continuing and building upon this new Lottery holiday tradition, we developed a truly exciting, fun-filled line up of instant offerings. On Oct. 29, we released five holiday-themed tickets: $1 Holiday Cash, $2 Holiday Surprise, $2 New Year Tripler, $5 Nutcracker Cash and $10 Holiday Gold. Order quantities for holiday games are reduced from our print runs throughout the rest of the year, but are formulated to sell through our 10-week holiday sales period and into the New Year. We increased our holiday quantities this year from 11 million to 15 million print runs. The $2 ticket historically is the first to sell out of stock, but this was the first year we released two $2 games for the holiday so Holiday Surprise is still in market, but sold out of our warehouse during the first week of January. To date, the $1 ticket has sold $7.6 million, $2 tickets have sold $34.3 million, the $5 ticket has sold $44.2 million, and the $10 ticket has sold $61.4 million. Major lessons learned in 2013: While the holiday season is only a few weeks behind us, it is never too early to start planning for the coming year. Much like we did in 2013, we will begin focus group testing holiday ticket concepts early to provide ample time to refine our offerings and ensure that our products are of the highest entertainment value to players; in doing so, we hope to once again strike “Holiday Gold” in 2014. INSIGHTS March/April 2014 57

Minnesota State Lottery

Minnesota’s holiday lineup included four games: One each at $1, $2, $3 and $5. Most successful game(s): For scratch games, our $2 Merry Money ticket exceeded last year’s $2 holiday game sales by 30 percent. It was the best performing holiday game in 2013 vs. 2012. For lotto games, our Minneso- ta Millionaire Raffle, which we also consider a seasonal game, was once again a sellout in its 8th year. The Raffle is a $10 ticket with two million dollar top prizes, merchandise bonus prizes and a limited 600,000 ticket pool. It is a hot ticket that players give to others and gift to themselves! General holiday strategies: We had four holiday scratch games, at $1, $2, $3 and $5 price points in various holiday colors and themes. The tickets were merchandised as a family of games in on-counter and in-counter dispensers during an eight-week period. These scratch games were supported with festive in-store POS, a gift-giving-themed TV campaign and a popular second-chance “Tech the Halls” contest. The Raffle game was supported with in-store POS and store promotions. Major lessons learned in 2013: We will most likely adjust our advertising strategy to support changes to the Raffle game instead of focusing on the scratch product. We also learned that launching the scratch tickets later in an already shortened holiday shopping period hurt our sales.

Nebraska Lottery

Nebraska’s holiday lineup included three games: One each at $1, $2 and $5. Most successful game(s): From the standpoint of reaching multiple goals, our $5 Naughty or Nice game stood out as the most successful. This game featured a new “all or none” play style. The art of the ticket was a Christmas tree that was made up of alternating green and red rows of numbers. The bottom row had eight numbers; the next one up had seven, then six, and so on until the top row had two. The numbers were covered with a translucent scratch material that was used as a marking system for the game. A box above the tree had 22 “YOUR NUMBERS.” The player would uncover the YOUR NUMBERS and then scratch off each matching number in the tree. If the player completed a row by matching all of the numbers, they won the corresponding “gift” prize. It the row remained unscratched due to matching none of the YOUR NUMBERS, the player won the “coal” prize that went with that row. The row at the bottom of the tree gave the highest gift and coal prizes. The prize amounts got smaller with each row going up the tree. The bonus game at the trunk of the tree was a match-3 diamonds game to win a prize. Another unique part of this game was the bonus prize. If the player matched all three diamonds, the prize would either be cash or one, two or five Nebraska Pick 5 quick pick draws for the next drawing. We felt the game was successful because it was 97 percent settled by the time it was closed, the players seemed to have embraced the new play style, and we put a lot of our Nebraska Pick 5 draws into the hands of players that might not otherwise play our terminal-based games. The overall odds of winning a cash prize in this game was 1:3.22. The overall odds, including cash, Pick 5 draws, or both was 1:2.03. We wanted the odds to be this low because it was a holiday game and there was a chance that many non-traditional players might have received it as a gift. More winning tickets meant more exposures to the lottery-retailer experience. General holiday strategies: We usually try to launch our holiday games at the beginning of October. This year, we decided to launch a little bit later so we could clear out some of our existing inventory at the $1, $2 and $5 price points, thus putting a brighter spotlight on the holiday games. We have closed $5 Naughty or Nice. $2 Holiday Gifts is virtually sold out of the warehouse, while $1 Holiday Quick 7s is gone. Only retail inventory remains and we are waiting for the last top prize from both games to be claimed so they can be closed. Our advertising showed the three holiday Scratch games along with Nebraska Pick 5 game as a reminder that lottery tickets make great gifts. We ran advertising on TV, radio, and in-store POS. Major lessons learned in 2013: We have yet to determine how we will apply what we learned in 2013 to our plans for 2014. We tend to not follow in our same footsteps when it comes to holiday games. We wouldn’t rule out a $10 game and another $5 game with a crossover scratch/terminal game feature in 2014. $1 Holiday Quick 7s is never a bad idea. 58 INSIGHTS March/April 2014

New Hampshire Lottery

New Hampshire’s holiday lineup included four games: One each at $1, $2, $5 and $10. Most successful game(s): Our $2 Holiday Hundreds was our biggest success – it indexed higher than our other holiday games and had more unit sales at week 10 (our usual benchmark week). I think it’s mainly because it is a $2 ticket. I also think the design was very appealing. Our other price points ($1, $5, $10) struggled a bit, until Decem- ber, but the $2 was consistently in demand. Maybe this was impacted by the economy. General holiday strategies: Our theme was centered around the word “Holiday” but we had a variety of styles (no common theme). We launched in mid-October and our strategy was much the same as last year. The games did feature prominently in POS and online content. Major lessons learned in 2013: Sales were generally as expected but were slow until after Thanksgiving; therefore, we might launch holiday games later this year. This was the second succes- sive year that we included a $10 holiday game after a gap of 6 years; sales were disappointing and we are considering reducing the print run or perhaps not having this price point again.

North Carolina Education Lottery

North Carolina’s holiday lineup included five games: One each at $1, $2, $3, $5 and $10. Most successful game(s): Our $5 holiday game, Jingle Big Ol’ Bucks, was the most successful of the holiday games this year. It was our highest indexing holiday game and the one that sold through the fastest. The game’s success was due to a couple of factors. Our $5 price point has been growing the fastest of all of the price points this year, and this game brought back a previously successful theme that we hadn’t used in a few years. General holiday strategies: We launched five holiday tickets in the beginning of November, and this was the first year that five holiday games were introduced at the same time. We also moved our holiday launch to No- vember this year after launching the previous two years in October. I believe that this strategy proved to be successful because it allowed us to align the advertising for the games with the launch. In previous years we launched the tickets in October and followed up with advertising in November. All of our games were completely out of the warehouse by the end of December and sold through by the end of January (with the exception of the $3 game, which was 90 percent sold). We also ran a promotion through our Lucke-Rewards program that awarded triple points to players who entered a qualifying holiday ticket during the three weeks leading up to Christmas. This promotion was much more successful than the one last year when a similar point multiplier promotion for holiday tickets was offered the two weeks after Christmas. Major lessons learned in 2013: We determined that our holiday games are more successful when launched in November. We also learned that our market in North Carolina can support five holiday games at once, and potentially a sixth game in the future. INSIGHTS March/April 2014 59

The Ohio Lottery

Ohio’s holiday lineup included five games: One each at $1, $2, $3, $5 and $10. Most successful game(s): Our $1 Holiday Cash and our $5 Holiday Lucky Times 10 games are always popular with our players. Both of these games have been around for many years. Players are familiar with these two games and expect to see the new versions each year. General holiday strategies: We went with a basic holiday theme on each of our price points. We did not make any significant changes to the games compared to sales periods or payouts last year. We did add a $3 holiday game that sold well. We also added a “Holiday Bonus” second chance drawing for all non-winning holiday tickets; we gave away $500,000 in cash over two drawings. When players entered their non-winning tickets they received the number of entries equal to the price point of the ticket entered. We had 1,702,555 tickets entered, totaling 6,354,992 entries. Major lessons learned in 2013: We will most likely run the Holiday Bonus second chance drawing again due to its popularity.

Pennsylvania Lottery

Pennsylvania’s holiday lineup included six games: One each at $1, $2, $3, $5, $10 and $20. Most successful game(s): On the whole, the 2013 holiday games outperformed last year’s games by 12 percent, but within that number stand a handful of particular successes. Our $10 game, Sleigh Ride, was up 31 percent over last year. Last year’s $10 game had some atypical features found more often in the lower price points. We realized this was something out of the comfort zone for our players and decided going back, successfully, to a more familiar layout in 2013. Sales of the $20 game, Merry Millionaire, topped $10 million in one week – the highest we’ve ever had for a holiday game! Our $1 and $2 price points were trending down for the year, but we were happy to see our holiday offerings at those price points bucked the trend: $1 Snow Days and $2 Cashing Thru the Snow were up 9.5 percent over last year. General holiday strategies: At the beginning of the development process, we will begin by looking closely at past games that have performed well to determine if there are similarities in art elements, colors, play style and prize structure design. From there, we can get a better grasp on what our players are looking for and improve upon that solid base for the next year. Every year, we launch the same six price points and generally have the same advertising/promotional period of about nine weeks. It is very important that all six games fit well together as a whole, ensuring themes are complimentary to one another. Also returning for 2013 were our successful $100,000 Jolly Jackpot Second-Chance Drawings. There were over 27.5 million entries recorded, up 17 percent over 2012’s drawings, with an overall participation rate of about 32 percent. In other words, over 32 percent of eligible tickets were entered. Major lessons learned in 2013: One thing that we heard from players during holiday focus groups was how much they loved the scented tickets. In 2011, we launched $1 Candy Cane Cash with a peppermint scratch-and-sniff feature. That game’s sales remain unbeaten by the two holiday $1 games that have followed. We will seriously consider bringing “peppermint” back into the mix for 2014. Players continue to reward variety and the added value we offer with our very popular second-chance drawings, so we do not stray too far from that core value. 60 INSIGHTS March/April 2014

South Dakota Lottery

South Dakota’s holiday lineup included three games: One each at $1, $2 and $5. Most successful game(s): Bah Humbucks – a $1 game – was our most successful game. We think it is because people can give more tickets for less money. The present just looks bigger. General holiday strategies: Our three holiday games launched in late October – a $1, $2 and a $5 game. Our goal was to top last year’s holiday season. Holiday sales came in slightly below last year’s sales due to numerous days of bad weather. We made no significant changes over last year. Our advertising message was mainly promoting gifting and that most lottery retailers (C-stores) are open late on Christmas eve. Major lessons learned in 2013: You can’t change the weather. And we will try to get retailers to use multiple facings of holiday games next year.

Texas Lottery Commission

Texas’ holiday lineup included six games: Two at $5 and one each at $1, $2, $10 and $20. Most successful game(s): Our $5 Trim The Tree game was our most successful holiday ticket this year with an increase in sales over $2.8 million compared to the $5 holiday ticket launched the previous year in the first twelve weeks of sales. General holiday strategies: This year our entire instant launch strategy was changing during the holiday time period. The Texas Lottery has historically launched new games every 1 to 2 weeks. We began a process to change that strategy to a monthly launch schedule with a reduction in the number of games introduced annually. This year’s holiday sales focus was not solely directed to the holiday games themselves but rather the entire instant game portfolio. We concentrated on ensuring that our core games were faced and that retailers’ bins were reorganized to reflect a newly developed plan-o-gram. In order to ensure placement of our core product offerings at the $3 price point, Loteria, Cashword and Bingo, we decided to not introduce a $3 holiday game this year. As in past years, we did offer retailers a pack settlement promotion featuring some of the holiday games and one $20 non-holiday spotlight game. Due to our overall instant portfolio strategy changes, our holiday games did not perform as well as they did last year. However, our overall strategy proved very successful during the holiday period. Through the week ending Dec. 28, 2013, Texas’ overall instant product sales were up $31 million over the previous fiscal year. Major lessons learned in 2013: A successful holiday season is not solely based upon the sales of a few games in your portfolio. The combined sales of the entire category are the focus and with this in mind the Texas Lottery is pleased with the successful sales we realized through the 2013 holiday season. We plan to continue to review this past year’s strategy as we prepare game planning meetings for our next fiscal year. INSIGHTS March/April 2014 61

Vermont Lottery

Vermont’s holiday lineup included four games: One each at $1, $2, $5 and $10. Most successful game(s): The $10 Holiday Magic was probably our biggest success. No specifics but our $10 price point is moving ahead in general. Per caps were about almost .02 higher than last year and it is selling out three weeks earlier than expected. Cabin Fever (an additional winter theme game) indexed less than expected but sold through better than its counterpart from last year. Holiday Money ($5) did the same thing. Jingle Bell Bonus ($2) was a game we brought back after a four-year hiatus – it sold out a week sooner than expected. General holiday strategies: We staggered our release dates for the holiday and winter theme games and it seemed to have worked well. We reduced quantities on our $2 and $5 offerings but we’ve yet to analyze if that helped. Though our $1 games indexed well, our sell out rates are the same or less than last year. We experimented with the $1 prize structures, putting a majority in the low tier and adjusting the top wins. Whether that strategy was a direct effect on the overall success is to be determined. We had more media support specific for the games than last year and am sure that contributed to our overall success. Major lessons learned in 2013: We’ll continue to adjust the recipe for the best quantities and prize structures.

Western Canada Lottery Corp.

WCLC’s holiday lineup included eight games: Two at $4, and one each at $1, $2, $3, $5, $10 and $20. Most successful game(s): The Player’s Choice Mega Pack was the most successful holiday ticket this year as it achieved record level sales. This ticket has been our strongest holiday ticket over the past seven years. General holiday strategies: WCLC continues to provide a variety of holiday themed tickets and price points to provide a wide selection for our consumers at this key time of the year. This year WCLC had eight holiday tickets with the addition of a $10 ticket into the holiday theme mix. It was the third year for our Tech The Halls promotion; entries were down slightly but our overall sales were up. We did introduce new advertising and started the TV and radio support a few weeks sooner than previous years. Major lessons learned in 2013: We are still evaluating the results of our holiday season, but this year WCLC added a $10 Holiday ticket to the mix which added sales with very minimal can- nibalization of the other price point tickets. This is a practice we will continue next year. 62 INSIGHTS March/April 2014

Wisconsin Lottery

Wisconsin’s holiday lineup included six instant games: Two at $1, and one each at $3, $5, $10 and $15. The Lottery also offered a Holly Jolly Raffle game. Most successful game(s): Not to discount historically reliable sellers, like $3 Naughty or Nice Crossword, but it’s safe to say that $10 Holiday Surprise was the hottest holiday game in Wisconsin this season. It sold out in under six weeks, despite having a relatively low top prize of $50,000 (compared to the typical $100,000 prize at our $10 price point). It featured Pollard’s eye-catch- ing Scratch FX printing option, the third $10 holiday game to do so. We had wondered if the third time out would lose some steam, even with a color and name change, but it continues to perform year after year. General holiday strategies: Our 2013 holiday game mix replicated the successful strategy of the previous year. This holiday season’s offerings included the following games: • $1 Kitty Claus, a pulse (1 of 3) in our Kitty Series game – meant to last a very short time. It launched Nov. 1 and sold out Nov. 14. • $1 Stocking Stuffer, a pulse in our Holiday Series 5 game – again meant to last a short time. It launched closer to the holidays than the other games, Nov. 15, and sold out Nov. 29. • $3 Naughty or Nice Crossword, a holiday staple in Wisconsin (i.e. the game name is the same, but the crossword art and bonus features change year to year). It launched Oct. 18 and sold out Dec. 11. • $5 Sweet Winnings, a $5 game loaded with $500 top prizes, launched Oct. 11 and sold out Dec. 2. • $10 Holiday Surprise, a short run game of a regular-sized $10 ticket but with a premium appearance. It launched Oct. 11 and sold out Nov. 20. • $15 Holiday Countdown, an oversized holiday calendar ticket featuring pull-tabs opening to individual, scratch-able play spots. It launched Oct. 11 and sold out Dec. 16. We used a radio spot to support the $1 to $10 games. The $15 game had its own original TV spot. There was a variety of special POS supporting all the games.

INSIGHTS would like to thank all the participating lotteries 63 INSIGHTS September/October 2013 INSIGHTSINSIGHTSINSIGHTS January/February September/October March/April 2014 2013 63 63

July 21-25, 2014 • Sheraton Myrtle Beach Convention Center Hotel • Myrtle Beach, SC • Hosted by South Carolina Educational Lottery

The Seminar fosters: • Communication within the industry • Networking opportunities • Education through real-world problem solving • Product examples and opportunities • Case-study presentations • Candid conversations 64 INSIGHTS March/April 2014

Sales By Product - 2012 VS 2013

Jurisdiction Instants Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona $112.53 $120.20 $109.60 $116.69 $97.07 $106.14 $102.68 $112.55 Arkansas $108.20 $101.80 $92.70 $88.10 $79.57 $75.50 $85.60 $76.10 California $772.42 $782.72 $709.91 $800.70 $692.03 $702.50 $734.60 $825.63 Colorado $94.10 $95.70 $90.60 $93.90 $86.20 $86.90 $92.80 $91.80 Connecticut $167.92 $165.65 $168.71 $176.85 $155.71 $161.83 $169.05 $167.36 Delaware $12.07 $12.16 $12.08 $12.38 $11.07 $12.18 $11.70 $12.62 District of Columbia $15.66 $14.63 $15.97 $13.96 $13.56 $13.31 $12.07 Florida $714.45 $817.38 $686.66 $816.29 $641.30 $753.29 $753.57 $838.75 Georgia $742.02 $704.93 $652.65 $685.67 $611.84 $629.21 $628.27 $647.35 Idaho $27.27 $27.30 $26.00 $28.12 $25.67 $28.16 $27.59 $29.92 Illinois $455.16 $469.30 $454.20 $414.33 $426.28 $430.51 $434.46 Indiana $148.50 $148.89 $141.01 $168.23 $138.28 $168.53 $159.29 $168.93 Iowa $52.58 $58.24 $47.56 $51.82 $47.56 $45.00 $48.57 $46.23 Kansas $36.31 $34.80 $31.42 $31.20 $29.50 $29.90 $31.00 $31.70 Kentucky $132.53 $136.49 $131.13 $132.29 $122.59 $123.59 $128.89 $126.48 Louisiana $43.40 $44.75 $39.37 $43.70 $35.82 $41.28 $38.89 $44.02 Maine $40.57 $38.55 $41.66 $42.00 $40.00 $42.70 $42.59 $43.16 Maryland $134.00 $122.73 $132.62 $120.91 $118.55 $110.06 $123.65 $117.24 Massachusetts $828.70 $844.40 $840.02 $868.55 $785.00 $785.00 $836.12 $826.58 Michigan $204.05 $197.40 $197.30 $216.28 $183.58 $208.36 $205.02 $219.38 Minnesota $100.72 $93.35 $95.65 $90.01 $90.68 $89.34 $89.79 $87.14 Missouri $193.76 $188.41 $188.67 $193.59 $172.96 $182.97 $203.94 $203.15 Montana $4.33 $4.58 $4.27 $4.00 $4.19 $3.90 $4.50 $4.10 Nebraska $23.29 $22.94 $20.49 $21.75 $18.78 $19.96 $20.14 $20.37 New Hampshire $46.67 $47.34 $45.11 $48.11 $47.76 $46.14 $45.15 $48.52 New Jersey $369.40 $386.59 $369.72 $385.84 $347.83 $359.06 $354.06 $377.97 New Mexico $17.96 $18.71 $16.47 $17.58 $16.57 $16.41 $17.03 $16.90 New York $928.41 $924.67 $971.56 $973.48 $912.26 $884.68 $915.71 $903.85 North Carolina $261.64 $270.70 $251.38 $283.90 $224.52 $272.70 $232.80 $283.30 North Dakota Ohio $393.18 $353.37 $371.10 $344.80 $345.26 $317.49 $386.21 $355.92 Oklahoma $26.87 $23.95 $23.93 $20.90 $21.20 $20.32 $23.34 $21.18 Oregon $30.10 $29.59 $29.84 $27.48 $28.10 $26.00 $31.86 $30.33 Pennsylvania $553.48 $582.59 $549.31 $602.31 $530.57 $568.84 $589.63 $635.02 Puerto Rico $14.86 $14.50 Rhode Island $21.83 $20.77 $21.33 $21.58 $20.40 $20.01 $22.45 $21.47 South Carolina $212.95 $211.62 $190.70 $217.13 $185.22 $204.41 $192.01 $213.76 South Dakota $6.12 $6.54 $4.83 $6.04 $5.75 $6.71 $6.40 $6.20 Tennessee $291.20 $285.30 $267.70 $294.50 $248.34 $266.87 $260.58 $281.68 Texas $836.28 $859.57 $795.78 $820.13 $740.68 $772.95 $779.26 $811.47 Vermont $20.05 $19.39 $18.03 $18.24 $18.07 $17.70 $18.52 $19.21 Virginia $219.63 $227.97 $216.07 $234.11 $201.20 $224.37 $223.86 $247.19 Washington $81.98 $92.39 $80.86 $91.73 $83.86 $90.25 $88.04 $94.56 West Virginia $29.85 $27.80 $29.99 $26.26 $26.96 $27.68 $27.63 $24.54 Wisconsin $82.45 $81.91 $83.82 $83.18 $74.78 $79.39 $83.92 $82.17 Total(USD) $9,594.59 $9,718.07 $8,797.61 $9,790.50 $8,695.57 $9,082.98 $9,280.53 $9,676.83

Atlantic $42.95 $45.55 $46.98 $52.85 $45.30 $50.10 $50.49 $51.29 British Columbia $45.08 $49.28 $50.86 $57.62 $44.94 $55.14 $63.45 $63.43 Loto-Quebec $117.21 $112.68 $110.00 $127.00 $111.09 $129.35 $117.10 $111.60 Ontario $211.64 $204.27 $207.47 $216.89 $204.94 $206.82 $226.14 $220.59 Western Canada $61.49 $68.57 $57.41 $54.16 $52.46 $55.43 $67.94 $67.79 Total(CAD) $478.37 $480.35 $472.72 $508.52 $458.73 $496.84 $525.12 $514.70 INSIGHTS March/April 2014 65

Sales By Product - 2012 VS 2013

Jurisdiction Pulltab/Breakopen Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona $0.99 $1.10 $0.83 $0.99 $0.81 $1.01 $0.93 $1.03 Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Idaho $5.16 $5.65 $5.40 $5.54 $5.32 $5.25 $5.31 $5.52 Illinois Indiana $2.70 $1.93 $1.39 $0.19 Iowa $4.58 $3.90 $4.43 $4.01 $4.43 $4.04 $4.15 $3.91 Kansas $2.81 $2.91 $2.61 $2.80 $2.60 $2.40 $2.65 $2.54 Kentucky Louisiana Maine Maryland Massachusetts $0.21 $0.18 $0.20 $0.33 $0.26 $1.63 $1.74 Michigan $7.33 $8.30 $6.67 $8.18 $6.67 $7.73 $7.50 $7.66 Minnesota Missouri Montana Nebraska New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Puerto Rico Rhode Island $0.16 $0.12 $0.02 $0.01 $0.02 $0.01 $0.02 $0.01 South Carolina South Dakota Tennessee Texas Vermont Virginia Washington West Virginia Wisconsin $0.55 $0.61 $0.56 $0.68 $0.81 $0.51 $0.58 $0.21 Total(USD) $24.49 $22.77 $22.65 $22.21 $22.38 $21.21 $22.96 $22.62

Atlantic $29.89 $29.31 $31.15 $32.35 $31.75 $33.67 $30.98 $31.70 British Columbia $8.86 $7.68 $8.70 $8.23 $7.94 $8.01 $8.25 $7.36 Loto-Quebec Ontario $2.81 $4.66 $2.85 $5.17 $3.02 $7.38 $3.82 $8.69 Western Canada Total(CAD) $41.56 $41.65 $42.70 $45.75 $42.71 $49.06 $43.05 $47.75 66 INSIGHTS March/April 2014 Sales By Product - 2012 VS 2013

Jurisdiction 3 Digit Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona $2.18 $2.15 $2.25 $2.17 $2.08 $2.18 $2.14 $2.28 Arkansas $1.60 $1.50 $1.60 $1.60 $1.52 $1.51 $1.50 $1.60 California $34.11 $33.75 $35.17 $33.83 $33.80 $33.11 $34.13 $33.36 Colorado $1.90 $2.30 $2.10 Connecticut $30.37 $30.98 $30.18 $33.92 $30.10 $33.28 $31.39 $31.56 Delaware $6.28 $7.37 $6.32 $6.37 $6.07 $5.98 $6.12 $6.20 District of Columbia $13.63 $12.36 $12.59 $12.88 $12.01 $12.15 $11.17 Florida $82.75 $81.78 $81.22 $84.85 $77.34 $82.42 $80.58 $81.14 Georgia $121.59 $118.65 $122.65 $120.24 $118.33 $116.62 $119.62 $121.91 Idaho $0.46 $0.46 $0.49 $0.47 $0.49 $0.45 $0.48 $0.44 Illinois $71.38 $68.13 $67.50 $67.06 $63.03 $66.96 $58.86 Indiana $7.55 $7.46 $7.73 $7.51 $7.56 $7.97 $7.31 $7.65 Iowa $1.71 $1.71 $1.76 $1.72 $1.76 $1.69 $1.70 $1.74 Kansas $1.48 $1.44 $1.47 $1.40 $1.40 $1.40 $1.44 $1.48 Kentucky $31.77 $31.72 $32.21 $31.37 $31.81 $30.93 $30.49 $30.81 Louisiana $12.57 $12.68 $12.07 $12.65 $11.95 $12.27 $12.23 $12.46 Maine $1.27 $1.26 $1.28 $1.31 $1.31 $1.32 $1.22 $1.26 Maryland $63.95 $61.45 $63.59 $61.97 $61.68 $60.15 $60.42 $61.52 Massachusetts Michigan $82.58 $80.60 $82.93 $82.89 $78.41 $80.25 $77.37 $81.10 Minnesota $3.59 $3.53 $3.50 $3.45 $3.46 $3.46 $3.45 $3.54 Missouri $16.19 $16.37 $16.55 $16.85 $16.09 $17.23 $16.44 $17.65 Montana Nebraska $0.91 $0.92 $0.91 $0.99 $0.89 $1.01 $0.92 $1.00 New Hampshire $1.33 $1.25 $1.31 $1.26 $1.31 $1.24 $1.29 $1.27 New Jersey $110.91 $108.41 $110.20 $113.91 $107.20 $110.64 $104.53 $108.23 New Mexico $0.93 $0.89 $0.86 $0.91 $0.83 $0.91 $0.87 $0.93 New York $222.96 $210.93 $220.08 $227.01 $210.84 $212.90 $203.65 $218.56 North Carolina $61.53 $67.16 $61.50 $67.05 $60.16 $63.78 $64.50 $67.40 North Dakota Ohio $96.58 $85.61 $90.50 $88.99 $84.83 $83.52 $85.67 $85.14 Oklahoma $1.19 $1.10 $1.12 $1.08 $1.08 $1.08 $1.08 $1.22 Oregon Pennsylvania $90.23 $84.55 $86.19 $86.75 $86.29 $82.12 $87.56 $84.19 Puerto Rico $37.27 $36.00 Rhode Island South Carolina $36.64 $39.21 $35.36 $37.53 $34.65 $36.59 $36.96 $36.96 South Dakota Tennessee $14.90 $14.90 $14.00 $14.40 $13.72 $14.32 $14.18 $14.75 Texas $71.45 $69.17 $71.01 $69.16 $67.56 $66.08 $69.45 $64.87 Vermont $0.33 $0.34 $0.34 $0.34 $0.35 $0.34 $0.34 $0.32 Virginia $62.76 $64.08 $61.31 $66.92 $59.45 $65.03 $63.22 $65.90 Washington $4.10 $4.20 $4.16 $4.25 $4.06 $4.11 $4.23 $4.20 West Virginia $2.21 $2.08 $2.09 $2.12 $2.01 $2.12 $2.09 $2.07 Wisconsin $6.07 $5.88 $6.00 $6.25 $5.83 $5.99 $5.88 $6.15 Total(USD) $1,372.04 $1,336.03 $1,269.91 $1,375.48 $1,306.16 $1,358.61 $1,313.56 $1,368.99

Atlantic British Columbia Loto-Quebec $4.13 $3.80 $4.00 $4.00 $4.04 $4.31 $4.42 $3.89 Ontario $14.90 $14.93 $15.36 $15.50 $15.77 $15.62 $15.60 $15.40 Western Canada $5.52 $5.67 $5.58 $5.73 $5.61 $6.10 $5.64 $5.83 Total(CAD) $24.55 $24.40 $24.94 $25.23 $25.42 $26.03 $25.66 $25.12 INSIGHTS March/April 2014 67 Sales By Product - 2012 VS 2013

Jurisdiction 4 Digit Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona Arkansas $0.90 $0.80 $0.80 $0.90 $0.79 $0.89 $0.80 $0.90 California $7.54 $7.17 $7.65 $6.97 $7.30 $6.79 $7.41 $6.83 Colorado Connecticut $24.66 $26.74 $24.61 $28.99 $24.52 $27.74 $26.99 $28.11 Delaware $4.72 $4.84 $4.63 $4.94 $4.59 $4.66 $4.79 $5.04 District of Columbia $16.71 $14.94 $15.36 $15.56 $14.36 $15.37 $14.17 Florida $63.22 $59.95 $60.96 $63.55 $58.64 $60.03 $61.99 $62.72 Georgia $50.16 $53.45 $48.81 $52.35 $48.98 $51.36 $54.54 $55.64 Idaho Illinois $49.85 $51.40 $50.50 $46.89 $46.41 $49.96 $46.42 Indiana $7.60 $7.29 $7.53 $7.46 $7.48 $7.66 $7.36 $7.54 Iowa $0.71 $0.79 $0.70 $0.80 $0.70 $0.77 $0.77 $0.82 Kansas Kentucky $9.60 $9.84 $9.57 $9.70 $9.52 $9.40 $9.61 $9.92 Louisiana $9.74 $10.18 $9.67 $9.91 $9.52 $9.41 $9.84 $10.11 Maine $1.03 $1.01 $1.05 $1.03 $1.10 $1.10 $1.08 $1.05 Maryland $66.22 $66.42 $66.91 $67.44 $66.31 $65.67 $67.63 $68.70 Massachusetts $84.50 $80.50 $82.89 $82.34 $79.70 $78.50 $81.83 $80.40 Michigan $92.61 $86.60 $89.55 $88.65 $84.99 $88.85 $86.96 $91.78 Minnesota Missouri $7.84 $8.67 $8.23 $8.90 $8.25 $9.10 $8.67 $9.98 Montana Nebraska New Hampshire $1.30 $1.22 $1.21 $1.22 $1.15 $1.17 $1.20 $1.22 New Jersey $66.71 $67.43 $65.61 $68.40 $64.45 $67.29 $65.85 $68.24 New Mexico New York $205.40 $198.16 $202.29 $212.98 $196.02 $203.74 $197.08 $212.31 North Carolina $23.16 $26.27 $23.59 $27.60 $23.78 $26.97 $26.20 $28.80 North Dakota Ohio $54.29 $46.13 $52.77 $47.75 $48.61 $45.76 $47.19 $47.67 Oklahoma $0.48 $0.46 $0.47 $0.47 $0.45 $0.40 $0.47 $0.00 Oregon $0.35 $0.33 $0.33 $0.35 $0.33 $0.34 $0.33 $0.33 Pennsylvania $60.68 $59.41 $59.11 $60.25 $60.04 $57.71 $63.20 $61.59 Puerto Rico $35.06 $35.70 Rhode Island $6.46 $6.00 $6.27 $6.15 $6.15 $6.02 $6.22 $6.09 South Carolina $17.25 $17.63 $16.70 $17.70 $16.85 $17.31 $17.95 $17.95 South Dakota Tennessee $7.20 $7.60 $6.90 $7.60 $6.82 $7.42 $7.21 $7.88 Texas $17.91 $20.14 $19.51 $20.67 $19.47 $20.79 $18.90 $22.66 Vermont $0.32 $0.31 $0.34 $0.30 $0.33 $0.30 $0.32 $0.29 Virginia $57.79 $57.76 $56.10 $61.86 $53.16 $59.61 $59.39 $62.14 Washington $3.02 $3.00 $3.12 $2.99 $2.95 $2.96 $2.98 $2.94 West Virginia $1.28 $1.17 $1.23 $1.20 $1.18 $1.25 $1.20 $1.21 Wisconsin $3.09 $3.12 $3.02 $3.14 $3.00 $3.00 $3.10 $3.21 Total(USD) $1,024.30 $1,006.73 $942.13 $1,040.42 $979.58 $1,039.80 $1,014.39 $1,080.36

Atlantic $0.38 $0.38 $0.37 $0.38 $0.37 $0.38 $0.38 British Columbia Loto-Quebec $6.60 $6.60 $6.00 $6.00 $6.47 $7.38 $7.11 $6.66 Ontario $11.13 $12.45 $11.57 $12.84 $12.58 $13.06 $13.05 $12.86 Western Canada $0.94 $0.19 $0.91 $0.00 $0.84 $0.00 $0.77 $0.00 Total(CAD) $19.05 $19.62 $18.85 $19.22 $20.26 $20.82 $21.31 $19.52 68 INSIGHTS March/April 2014

Sales By Product - 2012 VS 2013

Jurisdiction 5 Digit Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona Arkansas California Colorado Connecticut Delaware $0.28 $0.23 $0.32 $0.23 $0.22 $0.21 $0.22 $0.22 District of Columbia $3.67 $3.95 $4.20 $4.00 $4.04 $3.96 $3.84 Florida $74.69 $71.29 $75.59 $70.73 $69.37 $69.50 $70.09 $71.55 Georgia $2.55 $2.54 $2.40 $2.53 $2.40 $2.47 $2.56 $2.40 Idaho Illinois Indiana $1.00 $4.59 $1.04 $4.72 $1.01 $3.12 $0.36 Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts $18.30 $17.50 $17.88 $18.13 $17.00 $17.40 $17.53 $17.68 Michigan Minnesota Missouri $6.41 $10.56 $7.18 $7.78 $10.12 $6.67 $8.38 $6.92 Montana Nebraska New Hampshire New Jersey New Mexico $2.16 $1.36 $1.61 $1.69 $1.71 $1.80 $2.01 $3.13 New York North Carolina $15.20 $16.22 $13.61 $16.46 $16.23 $17.60 $15.57 $14.74 North Dakota Ohio $7.49 $7.18 $5.27 $6.66 $7.79 $6.82 Oklahoma $1.08 $1.05 $1.06 $1.06 $1.03 $1.06 $1.03 $1.13 Oregon Pennsylvania $10.15 $10.85 $10.34 $10.95 $10.41 $10.44 $10.97 $10.90 Puerto Rico Rhode Island South Carolina $5.61 $5.48 $5.43 $4.60 $5.25 $4.46 $5.42 $4.99 South Dakota Tennessee Texas $18.63 $14.86 $14.59 $15.80 $15.82 $14.50 $14.74 $14.27 Vermont Virginia $6.71 $7.04 $6.93 $7.32 $6.85 $7.49 $7.09 $7.57 Washington $6.22 $5.06 $5.88 $6.48 $5.54 $6.44 $5.68 $6.30 West Virginia Wisconsin $5.10 $5.58 $5.94 $7.34 $5.89 $6.75 $5.60 $5.76 Total(USD) $177.76 $185.65 $169.80 $187.20 $178.12 $180.61 $179.00 $178.22

Atlantic British Columbia Loto-Quebec Ontario Western Canada Total(CAD) $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 INSIGHTS March/April 2014 69

Sales By Product - 2012 VS 2013

Jurisdiction Lotto Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona $10.38 $9.20 $7.97 $8.74 $7.79 $8.00 $7.24 $7.80 Arkansas California $106.38 $99.67 $98.79 $83.90 $95.97 $77.84 $95.83 $83.12 Colorado $7.60 $7.60 $10.10 $8.50 $7.50 $7.60 $8.90 $8.50 Connecticut $6.63 $5.65 $5.48 $5.33 $5.59 $6.08 $5.58 $5.37 Delaware District of Columbia Florida $97.16 $87.97 $94.28 $89.15 $86.74 $95.12 $88.52 $89.33 Georgia Idaho $0.60 $0.70 Illinois $28.71 $23.71 $25.30 $22.54 $24.27 $24.97 $25.95 Indiana $15.60 $10.69 $12.05 $11.20 $11.28 $12.70 $10.98 $10.23 Iowa Kansas Kentucky $1.79 $1.54 $1.62 $1.54 $1.56 $1.48 $1.50 $1.43 Louisiana $7.20 $6.28 $7.57 $6.47 $6.39 $7.70 $6.43 $6.67 Maine $3.88 $3.18 $4.12 $3.25 $4.01 $3.06 $3.66 $3.27 Maryland $7.76 $6.16 $7.47 $6.98 $7.99 $6.91 $7.59 $6.95 Massachusetts $6.80 $5.00 $5.54 $6.02 $5.70 $4.90 $5.34 $5.33 Michigan $12.55 $11.40 $11.87 $14.60 $10.73 $16.08 $10.26 $9.81 Minnesota Missouri $5.98 $5.17 $5.43 $5.24 $5.47 $6.66 $6.33 $5.93 Montana Nebraska $2.88 $2.88 $2.68 $2.88 $2.58 $2.69 $2.67 $2.72 New Hampshire $2.35 $1.90 $2.24 $1.91 $2.41 $2.00 $2.79 $1.95 New Jersey $19.07 $14.63 $28.05 $18.11 $16.53 $16.95 $16.06 $19.34 New Mexico New York $28.87 $28.48 $28.34 $26.06 $27.00 $23.41 $26.22 $22.15 North Carolina North Dakota Ohio $8.24 $10.41 $9.20 $11.85 $9.20 $10.04 $13.29 Oklahoma Oregon $9.64 $10.48 $6.60 $12.70 $7.07 $7.72 $7.81 $7.48 Pennsylvania $21.30 $22.28 $22.98 $21.36 $23.22 $39.18 $23.92 $28.91 Puerto Rico $23.38 $35.60 Rhode Island South Carolina $3.26 $0.52 South Dakota $0.55 $0.50 $0.58 $0.52 $0.60 $0.54 Tennessee Texas $43.24 $35.21 $41.58 $37.80 $39.14 $39.16 $40.06 $37.61 Vermont $1.34 $1.08 $1.43 $1.08 $1.50 $1.55 $1.22 $1.04 Virginia Washington $15.25 $10.22 $15.97 $12.58 $9.87 $10.28 $11.13 $11.80 West Virginia Wisconsin $4.30 $3.75 $4.12 $3.34 $4.50 $3.03 $3.36 $4.08 Total(USD) $475.45 $425.04 $436.06 $426.41 $422.88 $451.55 $429.01 $456.88

Atlantic British Columbia $13.29 $12.59 $13.03 $13.05 $12.14 $11.80 $13.24 $10.57 Loto-Quebec $45.63 $49.13 $47.00 $48.00 $45.98 $47.08 $54.50 $43.32 Ontario $20.39 $21.07 $19.65 $24.36 $22.65 $24.07 $19.56 $19.88 Western Canada Total(CAD) $79.31 $82.79 $79.68 $85.41 $80.77 $82.95 $87.30 $73.77 70 INSIGHTS March/April 2014

Sales By Product - 2012 VS 2013

Jurisdiction Spiel/Kicker Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Idaho Illinois Indiana $2.95 $2.12 Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Missouri Montana Nebraska New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio $1.25 $1.39 $1.21 $1.45 $1.23 $1.47 Oklahoma Oregon Pennsylvania Puerto Rico Rhode Island South Carolina South Dakota Tennessee Texas Vermont Virginia Washington West Virginia Wisconsin Total(USD) $0.00 $1.25 $0.00 $1.39 $1.21 $4.40 $1.23 $3.59

Atlantic $13.64 $12.00 $14.16 $13.07 $13.69 $12.39 $15.23 $15.05 British Columbia $12.84 $11.81 $13.94 $13.60 $12.98 $11.49 $15.36 $16.01 Loto-Quebec $36.28 $30.75 $32.00 $31.00 $35.29 $31.86 $39.20 $34.40 Ontario $46.66 $42.57 $48.96 $47.52 $46.52 $42.07 $51.77 $51.69 Western Canada $28.50 $27.82 $29.97 $31.60 $28.28 $33.71 $34.82 Total(CAD) $137.92 $124.95 $139.03 $136.79 $136.76 $97.81 $155.27 $151.97 INSIGHTS March/April 2014 71

Sales By Product - 2012 VS 2013

Jurisdiction Cash Lotto Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona $3.72 $3.90 $5.68 $4.11 $3.76 $4.82 $3.98 $4.05 Arkansas $0.99 $1.72 $2.00 $1.70 California $41.84 $43.72 $41.00 $38.65 $40.48 $38.40 $43.71 $35.74 Colorado $4.90 $5.50 $4.90 $5.30 $5.20 $4.80 $5.40 $4.70 Connecticut $8.47 $7.88 $8.46 $8.29 $8.21 $8.13 $8.18 $8.18 Delaware $1.15 $1.07 $1.08 $1.07 $1.06 $0.99 $1.05 $1.01 District of Columbia Florida $24.28 $22.84 $22.05 $21.75 $21.33 $19.19 $23.59 $20.82 Georgia $28.14 $23.04 $26.51 $29.59 $24.85 $26.49 $21.76 $24.92 Idaho $0.75 $0.63 $0.52 $0.51 $0.65 $0.75 $2.50 $2.50 Illinois $33.46 $32.08 $32.90 $36.08 $36.28 $33.69 $33.77 Indiana $2.23 Iowa $1.12 $1.10 $1.14 $1.14 $1.14 $1.11 $1.15 $1.11 Kansas $3.83 $3.22 $3.17 $2.80 $4.30 $3.60 $2.97 $4.31 Kentucky $2.63 $2.61 $2.59 $2.62 $2.57 $2.56 $2.64 $2.54 Louisiana Maine $1.16 $1.80 $1.88 $2.00 $1.66 $2.07 $1.60 $1.77 Maryland $5.25 $5.35 $5.65 $5.24 $5.43 $4.97 $5.06 $5.50 Massachusetts $6.90 $9.60 $11.30 $8.20 $9.92 $8.33 Michigan $13.89 $12.30 $12.72 $13.74 $13.13 $12.45 $14.79 $13.87 Minnesota $8.31 $8.73 $7.70 $8.31 $7.30 $7.50 $6.73 $6.13 Missouri Montana $0.95 $0.86 $0.95 $0.82 $0.77 $0.85 $0.91 $0.87 Nebraska $0.45 $0.42 $0.43 $0.43 $0.42 $0.42 $0.43 $0.42 New Hampshire $1.55 $1.93 $0.42 $2.41 $2.36 New Jersey $34.73 $36.41 $34.78 $41.04 $31.41 $35.43 $35.53 $38.42 New Mexico New York $81.35 $72.46 $79.97 $76.65 $73.82 $71.83 $74.84 $70.74 North Carolina North Dakota Ohio $16.40 $13.69 $16.14 $14.77 $13.99 $15.00 $18.72 $15.86 Oklahoma $1.77 $2.00 $1.69 $2.41 $1.57 $2.13 $2.33 $1.77 Oregon $1.34 $1.18 $1.30 $1.20 $1.22 $1.19 $1.22 $1.11 Pennsylvania $38.15 $42.93 $41.81 $38.32 $46.43 $39.88 $39.82 $35.80 Puerto Rico Rhode Island $1.09 $0.84 $1.05 $0.91 $0.97 $1.53 $0.87 $1.24 South Carolina $3.62 South Dakota $0.54 $0.44 Tennessee $4.40 $6.30 $5.40 $8.90 $5.09 $4.38 $4.59 $5.35 Texas $16.93 $13.86 $16.47 $13.81 $15.39 $13.75 $14.27 $13.34 Vermont $0.26 $0.79 $0.72 $0.69 $0.25 $0.66 $0.72 Virginia Washington West Virginia $1.39 $1.31 $1.36 $1.34 $1.29 $1.32 $1.30 $1.31 Wisconsin $6.38 $6.54 $6.30 $6.36 $6.14 $6.23 $6.31 $6.13 Total(USD) $396.94 $386.10 $353.49 $389.74 $388.64 $380.63 $395.29 $376.83

Atlantic British Columbia Loto-Quebec Ontario Western Canada $12.84 $21.57 $12.80 $28.55 $12.43 $23.93 $12.89 $22.95 Total(CAD) $12.84 $21.57 $12.80 $28.55 $12.43 $23.93 $12.89 $22.95 72 INSIGHTS March/April 2014

Sales By Product - 2012 VS 2013

Jurisdiction Multi-Jurisdiction (other than PB or MM) Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona Arkansas $1.20 $0.60 $1.10 $0.70 $0.92 $0.62 $0.70 $0.60 California Colorado Connecticut $7.04 $8.48 $7.00 Delaware $0.61 $0.71 $0.60 $0.99 $0.62 $0.77 $0.88 $0.61 District of Columbia $0.65 $0.75 $0.97 $0.62 $0.78 $0.90 $0.63 Florida Georgia $6.76 $5.74 $7.18 $5.67 $6.28 $5.46 $6.31 $5.20 Idaho $1.13 $1.27 $0.65 $0.94 $1.18 $1.38 $1.34 $1.21 Illinois Indiana Iowa $2.58 $2.53 $2.36 $3.44 $2.36 $2.72 $3.08 $2.22 Kansas $2.23 $2.31 $2.15 $2.70 $1.90 $2.30 $2.67 $2.05 Kentucky Louisiana Maine $0.57 $0.46 $0.50 $0.59 $0.46 $0.49 $0.53 $0.43 Maryland Massachusetts $12.71 $9.02 Michigan Minnesota $2.23 $2.70 $2.33 $4.44 $2.10 $3.29 $3.73 $2.38 Missouri Montana $1.21 $1.30 $1.17 $1.39 $1.19 $1.30 $1.30 $1.20 Nebraska $0.51 $0.56 $0.49 $0.50 $0.46 $0.48 $0.50 $0.47 New Hampshire $0.75 $0.72 $2.43 $2.74 $0.66 $0.82 $1.75 $0.67 New Jersey $1.23 New Mexico $1.24 $1.38 $1.21 $1.71 $1.15 $1.37 $1.69 $1.14 New York North Carolina North Dakota $1.95 $2.05 $1.92 $2.16 $1.79 $2.11 $2.16 $1.91 Ohio $0.70 Oklahoma Oregon Pennsylvania Puerto Rico Rhode Island $0.95 $1.95 $2.82 $1.95 $2.58 $1.90 $2.24 $1.79 South Carolina South Dakota $1.27 $1.50 $1.34 $1.51 $1.25 $1.39 $2.10 $1.31 Tennessee $2.40 $3.45 $2.64 Texas Vermont $0.73 $0.90 $0.27 $0.28 $0.21 $0.25 $0.26 $0.20 Virginia $7.93 $7.08 $8.32 $7.26 $7.51 $6.95 $7.34 $6.66 Washington West Virginia $1.13 $1.21 $1.14 $1.50 $1.03 $1.37 $1.32 $1.13 Wisconsin Total(USD) $35.63 $42.76 $50.69 $52.86 $42.75 $46.20 $40.80 $36.38

Atlantic $45.89 $41.33 $49.86 $46.58 $47.57 $43.46 $54.55 $57.39 British Columbia $88.38 $75.35 $97.38 $90.45 $88.30 $73.80 $111.23 $111.45 Loto-Quebec $178.12 $139.34 $160.00 $147.00 $175.57 $148.11 $200.50 $185.00 Ontario $357.70 $308.67 $417.72 $401.24 $376.21 $340.20 $441.32 $445.02 Western Canada $165.15 $141.84 $188.62 $176.44 $171.95 $143.87 $217.60 $204.21 Total(CAD) $835.24 $706.53 $913.58 $861.71 $859.60 $749.44 $1,025.20 $1,003.07 INSIGHTS March/April 2014 73

Sales By Product - 2012 VS 2013

Jurisdiction Powerball Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona $32.61 $34.20 $24.72 $42.56 $29.98 $39.07 $44.47 $23.90 Arkansas $11.60 $10.70 $9.10 $13.20 $10.30 $12.77 $13.20 $7.20 California $183.56 $177.24 $93.76 Colorado $24.70 $25.30 $19.70 $31.10 $25.00 $29.80 $35.40 $17.60 Connecticut $22.66 $23.56 $19.09 $29.98 $24.00 $29.74 $29.84 $16.96 Delaware $7.04 $7.37 $6.40 $9.28 $8.02 $9.91 $9.49 $5.43 District of Columbia $4.69 $4.19 $5.42 $4.62 $5.12 $5.89 $3.01 Florida $152.01 $148.46 $137.00 $174.94 $149.86 $158.53 $180.99 $103.95 Georgia $37.23 $38.47 $28.45 $49.97 $36.92 $48.07 $52.38 $27.69 Idaho $10.23 $9.78 $8.41 $12.40 $10.58 $12.23 $12.74 $7.88 Illinois $49.74 $54.20 $63.50 $50.48 $63.47 $69.76 $31.08 Indiana $30.44 $32.29 $24.62 $37.06 $30.23 $37.72 $42.44 $23.00 Iowa $16.95 $17.95 $14.38 $21.28 $14.38 $21.13 $24.09 $12.82 Kansas $10.98 $11.23 $9.41 $14.50 $11.10 $13.90 $15.20 $8.87 Kentucky $24.31 $23.92 $20.10 $27.89 $24.31 $27.26 $28.83 $17.55 Louisiana $29.98 $29.37 $23.83 $36.40 $27.81 $35.62 $36.36 $22.05 Maine $6.17 $5.73 $5.40 $7.85 $5.90 $7.33 $7.83 $5.08 Maryland $25.26 $28.37 $22.30 $37.20 $27.83 $37.19 $37.94 $20.87 Massachusetts $25.40 $33.50 $20.26 $40.50 $27.80 $41.50 $45.85 $20.61 Michigan $31.73 $38.60 $26.84 $47.30 $36.17 $49.11 $51.75 $24.99 Minnesota $23.21 $22.52 $19.19 $28.76 $24.69 $28.81 $31.16 $16.40 Missouri $28.61 $27.86 $23.47 $35.64 $27.28 $35.63 $36.45 $20.67 Montana $4.60 $4.24 $3.99 $5.51 $4.57 $5.08 $5.90 $3.50 Nebraska $10.88 $10.96 $9.32 $13.07 $11.19 $13.21 $14.35 $8.85 New Hampshire $9.96 $10.52 $7.62 $12.13 $9.97 $12.69 $12.35 $7.30 New Jersey $55.94 $68.17 $47.42 $85.03 $67.88 $93.88 $79.29 $43.82 New Mexico $10.23 $10.27 $8.16 $12.86 $9.98 $11.80 $13.62 $6.96 New York $97.29 $122.82 $84.03 $143.49 $117.01 $154.39 $144.55 $74.44 North Carolina $45.57 $42.32 $36.67 $53.50 $44.64 $52.22 $56.50 $32.20 North Dakota $3.50 $3.29 $2.88 $4.47 $3.59 $4.22 $5.00 $2.69 Ohio $32.98 $35.96 $26.95 $46.69 $33.83 $46.15 $50.09 $23.65 Oklahoma $17.13 $17.16 $13.43 $20.35 $16.05 $20.89 $22.49 $12.34 Oregon $11.20 $12.40 $9.68 $16.40 $12.20 $16.19 $17.20 $8.66 Pennsylvania $83.70 $89.67 $69.96 $107.99 $90.85 $113.28 $112.35 $57.94 Puerto Rico Rhode Island $9.70 $9.28 $7.95 $10.88 $9.35 $10.91 $11.43 $6.88 South Carolina $28.04 $26.46 $22.72 $31.18 $26.70 $30.75 $33.28 $20.77 South Dakota $4.82 $4.40 $3.56 $5.54 $4.88 $5.64 $6.20 $3.50 Tennessee $31.00 $29.00 $24.80 $36.20 $28.97 $34.41 $39.08 $21.22 Texas $56.85 $64.14 $47.88 $90.99 $59.86 $93.15 $96.45 $50.14 Vermont $2.86 $2.67 $2.29 $3.19 $2.69 $3.21 $3.50 $2.11 Virginia $26.84 $30.87 $22.79 $42.34 $29.90 $35.87 $42.58 $22.81 Washington $12.95 $16.85 $10.90 $21.76 $14.31 $20.86 $23.00 $10.83 West Virginia $11.19 $11.13 $9.26 $13.34 $10.79 $13.13 $13.44 $8.44 Wisconsin $23.99 $24.64 $20.29 $31.23 $24.03 $31.69 $33.88 $17.91 Total(USD) $1,196.77 $1,274.79 $955.22 $1,758.43 $1,240.50 $1,744.77 $1,648.59 $978.33

Atlantic British Columbia Loto-Quebec Ontario Western Canada Total(CAD) $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 74 INSIGHTS March/April 2014

Sales By Product - 2012 VS 2013

Jurisdiction Mega Millions Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona $27.58 $7.10 $9.47 $9.43 $8.47 $8.05 $7.36 $23.91 Arkansas $11.70 $3.10 $4.70 $4.00 $3.80 $3.47 $3.00 $8.00 California $358.60 $87.74 $112.65 $96.96 $103.41 $77.72 $88.59 $157.22 Colorado $19.20 $5.00 $6.20 $6.90 $6.10 $5.80 $5.20 $15.30 Connecticut $19.62 $4.99 $7.18 $6.97 $6.47 $6.05 $5.29 $15.41 Delaware $2.91 $1.59 $4.93 $2.33 $1.99 $2.07 $1.68 $4.90 District of Columbia $4.92 $1.36 $1.84 $1.73 $1.57 $1.44 $3.46 Florida $16.70 $26.04 $64.52 Georgia $71.24 $20.49 $27.62 $27.37 $24.44 $23.47 $21.05 $49.95 Idaho $7.15 $1.93 $2.81 $2.56 $2.65 $2.28 $2.10 $5.07 Illinois $82.98 $23.28 $31.50 $29.66 $26.23 $24.61 $59.31 Indiana $21.99 $5.67 $8.31 $7.73 $7.52 $6.66 $6.24 $20.50 Iowa $10.53 $2.86 $4.02 $3.84 $4.02 $3.30 $3.03 $9.39 Kansas $7.23 $2.23 $3.15 $2.90 $2.80 $2.60 $2.35 $6.83 Kentucky $17.30 $5.98 $7.86 $7.78 $7.22 $7.06 $6.09 $15.29 Louisiana $18.32 $6.14 $9.83 $7.70 $7.72 $6.75 $6.67 $14.82 Maine $3.66 $0.95 $1.45 $1.17 $1.28 $1.05 $1.07 $2.89 Maryland $46.89 $15.86 $21.31 $20.67 $18.46 $17.55 $16.00 $38.22 Massachusetts $43.80 $11.20 $15.26 $15.40 $13.60 $13.00 $12.88 $33.13 Michigan $72.94 $22.00 $29.76 $29.87 $27.70 $25.82 $23.90 $53.13 Minnesota $13.70 $3.09 $4.62 $4.51 $4.20 $3.94 $3.32 $12.20 Missouri $20.39 $5.35 $7.77 $7.46 $7.48 $6.64 $5.79 $17.40 Montana $2.71 $0.77 $1.09 $0.95 $0.99 $0.86 $0.83 $2.00 Nebraska $5.82 $2.04 $2.78 $2.49 $2.53 $2.39 $2.20 $5.27 New Hampshire $7.19 $1.82 $2.59 $2.41 $2.36 $2.21 $1.84 $5.54 New Jersey $106.85 $28.41 $39.04 $43.13 $36.78 $36.86 $28.52 $81.50 New Mexico $7.18 $7.76 $2.41 $2.30 $2.18 $1.99 $1.85 $5.84 New York $211.78 $53.23 $76.66 $80.70 $69.49 $66.89 $55.04 $151.02 North Carolina $37.91 $11.73 $16.35 $15.13 $14.44 $13.30 $12.40 $29.60 North Dakota $3.21 $0.68 $1.05 $0.93 $0.88 $0.83 $0.83 $2.66 Ohio $77.36 $22.08 $31.86 $29.17 $28.08 $24.67 $23.44 $51.52 Oklahoma $13.67 $3.58 $4.94 $4.62 $4.35 $4.13 $3.56 $11.81 Oregon $11.30 $2.47 $3.84 $3.44 $3.31 $3.28 $2.58 $9.18 Pennsylvania $77.19 $17.14 $24.82 $27.44 $21.66 $22.99 $17.55 $60.10 Puerto Rico Rhode Island $6.37 $1.67 $2.61 $2.35 $2.15 $1.96 $1.79 $4.96 South Carolina $23.58 $7.46 $10.14 $8.97 $8.75 $8.12 $7.53 $20.55 South Dakota $2.21 $0.67 $0.78 $0.90 $0.82 $0.78 $0.72 $2.00 Tennessee $25.30 $7.10 $10.00 $8.90 $8.60 $7.60 $7.37 $19.17 Texas $120.50 $30.33 $41.74 $42.08 $37.39 $37.29 $31.44 $90.52 Vermont $2.13 $0.62 $0.87 $0.75 $0.78 $0.70 $0.65 $1.56 Virginia $58.04 $20.10 $25.71 $25.50 $23.33 $27.33 $20.57 $43.69 Washington $28.05 $7.61 $9.27 $10.87 $9.06 $9.16 $7.93 $21.59 West Virginia $6.98 $2.04 $2.99 $2.61 $2.54 $2.23 $2.08 $5.83 Wisconsin $18.69 $4.63 $6.73 $6.27 $5.78 $5.47 $5.00 $14.36 Total(USD) $1,736.67 $471.85 $607.17 $637.50 $576.97 $558.16 $483.38 $1,271.12

Atlantic British Columbia Loto-Quebec Ontario Western Canada Total(CAD) $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 INSIGHTS March/April 2014 75

Sales By Product - 2012 VS 2013

Jurisdiction Keno Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona Arkansas California $34.23 $42.10 $33.04 $44.27 $31.84 $45.24 $36.18 $45.28 Colorado Connecticut Delaware $1.12 $1.35 $1.17 District of Columbia $2.95 $3.39 $3.08 $3.07 $2.73 $2.60 $2.52 Florida Georgia $46.82 $50.70 $46.26 $49.68 $43.10 $44.19 $46.14 $46.47 Idaho Illinois Indiana Iowa Kansas $5.93 $5.32 $5.50 $4.90 $5.10 $4.60 $5.12 $4.81 Kentucky $5.72 Louisiana Maine Maryland $97.26 $88.12 $96.52 $81.28 $85.60 $76.19 $89.80 $76.58 Massachusetts $202.70 $203.10 $205.14 $205.76 $192.70 $194.70 $205.11 $200.73 Michigan $140.01 $141.20 $134.86 $134.30 $130.92 $131.92 $138.07 $140.10 Minnesota Missouri $17.03 $17.32 $15.40 $15.77 $15.10 $14.93 $17.22 $15.50 Montana Nebraska New Hampshire New Jersey New Mexico New York $135.12 $162.95 $136.34 $168.24 $136.84 $156.93 $143.81 $166.45 North Carolina North Dakota Ohio $55.08 $64.61 $60.18 $64.75 $58.97 $64.00 $61.35 $73.97 Oklahoma Oregon $23.80 $23.55 $24.03 $23.05 $22.45 $21.92 $22.56 $23.40 Pennsylvania Puerto Rico Rhode Island $21.31 $20.00 $21.24 $19.93 $19.59 $19.05 $19.44 $19.85 South Carolina South Dakota Tennessee Texas Vermont Virginia Washington $1.43 $1.43 $1.43 $1.45 $1.35 $1.43 $1.41 $1.46 West Virginia $1.74 $1.48 $1.53 $1.35 $1.40 $1.26 $1.45 $1.24 Wisconsin Total(USD) $785.41 $826.39 $781.47 $819.16 $748.03 $779.09 $790.26 $825.25

Atlantic $2.97 $2.93 $2.89 $3.08 $2.97 $3.09 $3.08 $2.96 British Columbia $57.10 $53.92 $59.21 $57.90 $53.88 $55.25 $56.40 $57.83 Loto-Quebec $36.92 $34.62 $32.00 $33.00 $34.03 $37.98 $37.30 $34.20 Ontario $20.31 $21.01 $20.32 $20.64 $21.09 $20.73 $21.01 $20.58 Western Canada $2.22 $2.18 Total(CAD) $119.52 $114.66 $114.42 $114.62 $111.97 $117.05 $117.79 $115.57

76 INSIGHTS March/April 2014 Sales By Product - 2012 VS 2013

Jurisdiction VLT Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona Arkansas California Colorado Connecticut Delaware $127.10 $100.32 $116.80 $98.82 $102.90 $92.02 $92.97 $82.84 District of Columbia Florida Georgia Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland $44.34 $148.67 $70.45 $148.08 $135.56 $419.88 $127.96 $135.82 Massachusetts Michigan Minnesota Missouri Montana Nebraska New Hampshire New Jersey New Mexico New York $449.74 $472.90 $461.30 $504.65 $466.52 $493.77 $424.64 $454.24 North Carolina North Dakota Ohio $33.75 $3.71 $63.57 $12.80 $35.01 $9.76 $28.21 Oklahoma Oregon $188.70 $187.32 $186.70 $189.00 $177.50 $183.63 $183.50 $182.20 Pennsylvania Puerto Rico Rhode Island $136.41 $130.30 $136.03 $134.93 $132.29 $132.47 $122.23 $119.05 South Carolina South Dakota $144.77 $149.79 $138.92 $144.79 $138.10 $142.25 $146.30 $147.50 Tennessee Texas Vermont Virginia Washington West Virginia $310.68 $265.56 $294.07 $265.44 $277.00 $251.00 $251.65 $237.66 Wisconsin Total(USD) $1,401.74 $1,488.61 $1,407.98 $1,549.28 $1,442.67 $1,750.03 $1,359.01 $1,387.52

Atlantic $99.13 $91.39 $97.92 $96.03 $97.82 $96.10 $94.44 $92.91 British Columbia Loto-Quebec $251.90 $230.49 $233.00 $225.00 $248.29 $260.34 $261.30 $230.60 Ontario Western Canada Total(CAD) $351.03 $321.88 $330.92 $321.03 $346.11 $356.44 $355.74 $323.51 INSIGHTS March/April 2014 77 Sales By Product - 2012 VS 2013

Jurisdiction Other Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona $1.85 $3.24 $1.46 $2.71 $1.59 $2.42 $4.03 $2.34 Arkansas $0.40 $2.70 $0.70 $3.80 $1.54 $2.78 $0.60 $3.70 California $3.54 $3.33 Colorado $2.30 $0.10 $2.20 $1.80 Connecticut $6.62 $0.64 $11.14 $8.77 $0.55 $0.67 $10.53 $9.02 Delaware $20.19 $17.08 $18.25 $14.16 $17.84 $13.61 $16.32 $13.21 District of Columbia $3.03 $4.10 $5.01 $3.55 $4.86 $4.02 $4.05 Florida $4.22 $2.33 $3.32 $1.15 $2.65 $15.33 Georgia $1.31 $1.30 Idaho $0.72 $0.85 $0.22 $0.00 $0.12 Illinois $10.00 $10.00 $6.60 $5.76 $9.26 $19.30 Indiana $7.53 $6.98 $7.38 $10.70 $7.26 $8.69 $7.09 $11.23 Iowa $0.24 Kansas $0.88 $0.79 $0.79 $0.97 $0.70 $0.70 $3.75 $4.19 Kentucky $6.32 $2.62 $5.37 $2.68 $3.30 $2.29 $2.78 $2.02 Louisiana $3.29 $2.73 $3.04 $3.10 $2.94 $2.96 $2.84 $2.72 Maine Maryland $35.41 $41.83 $36.73 $47.10 $35.42 $41.19 $38.85 $39.99 Massachusetts $6.00 $6.50 $6.14 $5.52 $1.85 $1.35 Michigan $1.37 $3.80 $0.00 $1.30 $0.00 $0.85 $0.00 $17.88 Minnesota $1.47 $2.18 $2.77 $4.93 $1.52 $1.80 $7.75 $8.91 Missouri $0.87 $1.19 $0.88 $0.98 $1.10 $0.80 $1.02 $0.81 Montana $1.17 $1.20 $1.26 $1.23 $1.08 $1.01 $3.80 $3.80 Nebraska New Hampshire $0.31 $0.41 $0.27 $0.37 $0.23 $0.33 $0.37 $0.36 New Jersey New Mexico $0.06 $0.06 $0.39 $0.20 $0.17 $0.18 $0.22 $0.16 New York $7.79 $7.47 $7.74 $7.61 $7.45 $7.23 $7.43 $7.36 North Carolina North Dakota Ohio $13.75 $22.51 $12.60 $23.84 $10.90 $21.23 $19.07 $21.55 Oklahoma $0.24 Oregon $0.46 $0.42 $0.44 $0.50 $0.45 $0.40 $0.46 $0.50 Pennsylvania $7.43 $7.83 $2.57 $2.17 $10.00 $10.00 Puerto Rico $0.51 $0.46 Rhode Island $0.40 $1.88 $0.33 $21.37 South Carolina South Dakota Tennessee Texas $18.64 $12.65 $7.45 $5.02 $23.93 $11.35 Vermont $0.25 $0.57 $0.23 $0.54 $0.22 $0.54 $0.47 $0.72 Virginia $9.98 $11.44 $3.23 $5.65 $3.14 $4.83 $3.29 $4.69 Washington $1.21 $0.00 West Virginia $21.12 $19.04 $19.89 $15.97 $19.32 $14.50 $18.78 $13.30 Wisconsin $0.99 $0.85 $0.83 $0.45 $0.87 $0.88 Total(USD) $166.64 $190.97 $155.36 $199.45 $137.64 $151.33 $219.03 $239.12

Atlantic $14.13 $13.39 $14.49 $14.66 $16.52 $16.59 $14.28 $15.02 British Columbia $9.38 $7.79 $8.78 $7.78 $7.58 $7.09 $8.48 $8.71 Loto-Quebec $58.19 $60.37 $12.00 $13.00 $15.23 $17.92 $14.40 $14.20 Ontario $41.92 $44.54 $37.94 $43.15 $38.85 $40.26 $55.03 $55.82 Western Canada $2.15 $2.17 $2.14 $2.28 $2.06 $2.08 Total(CAD) $123.62 $126.09 $75.36 $80.76 $80.32 $84.14 $94.25 $95.83 78 INSIGHTS March/April 2014 Sales By Product - 2012 VS 2013

Jurisdiction Sports Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona Arkansas California $4.38 $5.31 $2.46 $3.25 $2.62 $6.92 Colorado Connecticut Delaware $2.39 $1.96 $5.17 $7.00 $18.29 $21.84 District of Columbia Florida Georgia Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Missouri Montana $0.03 $0.03 $0.03 $0.03 $0.04 $0.03 $0.09 $0.10 Nebraska New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Puerto Rico Rhode Island South Carolina South Dakota Tennessee Texas Vermont Virginia Washington West Virginia Wisconsin Total(USD) $6.80 $7.30 $2.49 $3.28 $5.21 $7.03 $21.00 $28.86

Atlantic $9.37 $10.48 $6.48 $7.43 $6.40 $6.57 $10.84 $12.68 British Columbia $13.20 $12.29 $10.77 $10.23 $8.54 $8.37 $13.44 $15.09 Loto-Quebec $16.29 $16.45 $11.00 $13.00 $8.82 $10.19 $13.80 $19.10 Ontario $70.64 $69.81 $38.61 $47.75 $49.86 $55.59 $98.59 $116.30 Western Canada $28.38 $30.31 $14.71 $17.17 $15.78 $16.39 $33.51 $40.75 Total(CAD) $137.88 $139.34 $81.57 $95.58 $89.40 $97.11 $170.18 $203.92 INSIGHTS March/April 2014 79 Sales By Product - 2012 VS 2013

Jurisdiction Bingo Q1-2012 Q1-2013 Q2-2012 Q2-2013 Q3-2012 Q3-2013 Q4-2012 Q4-2013

Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Missouri Montana Nebraska New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Puerto Rico Rhode Island $0.32 $0.27 $0.66 $0.28 South Carolina South Dakota Tennessee Texas Vermont Virginia Washington West Virginia Wisconsin Total(USD) $0.00 $0.00 $0.00 $0.32 $0.00 $0.27 $0.66 $0.28

Atlantic British Columbia $74.94 $72.99 Loto-Quebec $8.60 $9.38 $8.00 $9.00 $9.94 $10.59 $9.90 $8.70 Ontario $5.53 $8.41 $5.32 $8.97 $17.93 $10.11 $6.26 $10.93 Western Canada Total(CAD) $14.13 $17.79 $88.26 $17.97 $100.86 $20.70 $16.16 $19.63 80 INSIGHTS March/April 2014 Sales By Product - 2012 VS 2013

Jurisdiction Total Q1-2012 Q1-2013 Q2-2012 Q2-2013

Arizona $190.85 $181.09 $161.98 $187.40 Arkansas $135.60 $121.20 $110.70 $112.30 California $1,359.50 $1,102.18 $1,040.67 $1,292.09 Colorado $152.80 $139.20 $133.70 $147.60 Connecticut $286.95 $273.13 $274.85 $299.10 Delaware $184.74 $155.82 $171.41 $151.92 District of Columbia $65.91 $59.67 $0.00 $64.44 Florida $1,212.78 $1,292.00 $1,161.08 $1,339.11 Georgia $1,111.67 $1,018.01 $962.53 $1,023.07 Idaho $46.99 $47.02 $45.00 $51.39 Illinois $783.98 $732.10 $0.00 $732.00 Indiana $244.79 $223.86 $211.60 $254.61 Iowa $88.99 $89.08 $76.35 $88.05 Kansas $68.87 $64.25 $59.67 $64.17 Kentucky $226.25 $214.72 $210.45 $215.87 Louisiana $124.50 $112.13 $105.38 $119.93 Maine $58.31 $52.94 $57.34 $59.20 Maryland $526.55 $584.96 $523.55 $596.87 Massachusetts $1,230.43 $1,211.48 $1,206.04 $1,251.24 Michigan $651.73 $602.20 $592.50 $637.11 Minnesota $153.23 $136.10 $135.76 $144.41 Missouri $297.08 $280.90 $273.58 $292.21 Montana $15.00 $12.98 $12.76 $13.93 Nebraska $44.74 $40.72 $37.10 $42.11 New Hampshire $71.41 $67.11 $62.78 $70.57 New Jersey $763.61 $710.05 $694.82 $755.46 New Mexico $39.76 $40.43 $31.11 $37.25 New York $2,368.71 $2,254.07 $2,268.31 $2,420.87 North Carolina $445.01 $434.40 $403.10 $463.64 North Dakota $8.66 $6.02 $5.85 $7.56 Ohio $747.86 $696.86 $675.01 $744.75 Oklahoma $62.19 $49.30 $46.64 $50.89 Oregon $276.89 $267.74 $262.76 $274.12 Pennsylvania $934.88 $909.42 $871.95 $963.20 Puerto Rico $0.16 $0.00 $0.00 $0.00 Rhode Island $204.12 $191.33 $199.32 $200.89 South Carolina $324.07 $307.86 $281.05 $320.73 South Dakota $159.74 $163.40 $150.01 $159.30 Tennessee $374.00 $350.20 $328.80 $372.90 Texas $1,181.79 $1,125.92 $1,048.56 $1,123.09 Vermont $28.27 $25.88 $24.59 $25.44 Virginia $449.68 $426.34 $400.46 $450.96 Washington $153.00 $140.76 $131.59 $152.11 West Virginia $388.12 $332.82 $363.55 $331.13 Wisconsin $150.62 $136.66 $137.77 $148.64 Total(USD) $18,394.79 $17,384.31 $15,952.03 $18,253.63

Atlantic $258.35 $246.76 $264.30 $266.43 British Columbia $248.13 $230.71 $337.61 $258.86 Loto-Quebec $759.87 $693.61 $655.00 $656.00 Ontario $803.63 $752.39 $825.77 $844.03 Western Canada $305.04 $298.15 $312.15 $315.82 Total(CAD) $2,375.02 $2,221.62 $2,394.83 $2,341.14 INSIGHTS March/April 2014 81 Sales By Product - 2012 VS 2013

Jurisdiction Total Total Q3-2012 Q3-2013 Q4-2012 Q4-2013 Q1-Q4 2012 Q1-Q4 2013

Arizona $151.55 $171.69 $172.83 $177.86 $677.21 $718.04 Arkansas $99.43 $99.26 $107.40 $99.80 $453.13 $432.56 California $1,008.37 $1,162.17 $1,043.07 $1,287.86 $4,451.61 $4,844.30 Colorado $130.00 $137.20 $149.50 $140.00 $566.00 $564.00 Connecticut $263.63 $280.52 $286.85 $281.97 $1,112.28 $1,134.72 Delaware $159.55 $149.40 $163.51 $155.09 $679.21 $612.23 District of Columbia $59.99 $59.03 $59.64 $54.92 $185.54 $238.06 Florida $1,107.23 $1,264.12 $1,274.66 $1,332.78 $4,755.75 $5,228.01 Georgia $917.14 $947.34 $953.94 $982.83 $3,945.28 $3,971.25 Idaho $46.54 $50.72 $52.66 $53.36 $191.19 $202.49 Illinois $667.04 $691.73 $709.72 $709.15 $2,160.74 $2,864.98 Indiana $212.01 $256.00 $243.49 $251.20 $911.89 $985.67 Iowa $76.35 $79.76 $86.54 $78.48 $328.23 $335.37 Kansas $59.40 $61.40 $67.15 $66.78 $255.09 $256.60 Kentucky $202.88 $204.57 $210.83 $211.76 $850.41 $846.92 Louisiana $102.15 $115.99 $113.26 $112.85 $445.29 $460.90 Maine $55.72 $59.12 $59.58 $58.91 $230.95 $230.17 Maryland $562.83 $839.76 $574.90 $571.39 $2,187.83 $2,592.98 Massachusetts $1,133.13 $1,143.46 $1,218.06 $1,195.88 $4,787.66 $4,802.06 Michigan $572.30 $621.42 $615.62 $659.70 $2,432.15 $2,520.43 Minnesota $133.95 $138.14 $145.93 $136.70 $568.87 $555.35 Missouri $263.85 $280.63 $304.24 $298.01 $1,138.75 $1,151.75 Montana $12.83 $13.03 $17.33 $15.57 $57.92 $55.51 Nebraska $36.85 $40.16 $41.21 $39.10 $159.90 $162.09 New Hampshire $65.85 $69.01 $66.74 $69.19 $266.78 $275.88 New Jersey $672.08 $720.11 $683.84 $738.75 $2,814.35 $2,924.37 New Mexico $32.59 $34.46 $37.29 $35.06 $140.75 $147.20 New York $2,217.25 $2,275.77 $2,192.97 $2,281.12 $9,047.24 $9,231.83 North Carolina $383.77 $446.57 $407.97 $456.04 $1,639.85 $1,800.65 North Dakota $6.26 $7.16 $7.99 $7.26 $28.76 $28.00 Ohio $652.95 $660.94 $720.56 $725.77 $2,796.38 $2,828.32 Oklahoma $45.73 $50.01 $54.30 $49.69 $208.86 $199.89 Oregon $252.63 $260.67 $267.52 $263.19 $1,059.80 $1,065.72 Pennsylvania $872.04 $936.61 $955.00 $984.45 $3,633.87 $3,793.68 Puerto Rico $0.00 $111.08 $0.00 $122.26 $0.16 $233.34 Rhode Island $193.83 $194.13 $187.35 $202.99 $784.62 $789.34 South Carolina $277.42 $304.90 $293.15 $315.50 $1,175.69 $1,248.99 South Dakota $151.40 $157.31 $162.26 $160.95 $623.41 $640.96 Tennessee $311.54 $338.45 $333.01 $352.69 $1,347.35 $1,414.24 Texas $1,002.76 $1,062.69 $1,088.50 $1,116.23 $4,321.61 $4,427.93 Vermont $24.84 $24.84 $25.94 $26.17 $103.64 $102.33 Virginia $384.54 $431.48 $427.34 $460.65 $1,662.02 $1,769.43 Washington $131.00 $145.49 $145.61 $153.68 $561.20 $592.04 West Virginia $343.52 $315.86 $320.94 $296.73 $1,416.13 $1,276.54 Wisconsin $131.59 $142.51 $148.50 $140.86 $568.48 $568.67 Total(USD) $16,188.31 $17,556.67 $17,198.70 $17,931.18 $67,733.83 $71,125.79

Atlantic $262.39 $262.35 $274.27 $279.00 $1,059.31 $1,054.54 British Columbia $309.29 $230.95 $289.85 $290.45 $1,184.88 $1,010.97 Loto-Quebec $694.75 $705.11 $759.53 $691.67 $2,869.15 $2,746.39 Ontario $809.42 $775.91 $952.15 $977.76 $3,390.97 $3,350.09 Western Canada $289.49 $248.00 $374.12 $378.43 $1,280.80 $1,240.40 Total(CAD) $2,365.34 $2,222.32 $2,649.92 $2,617.31 $9,785.11 $9,402.39 82 INSIGHTS September/October 2013 Save the Dates!

September 30 - October 3, 2014 NASPL ‘14 Hosted by New Jersey Lottery Atlantic City, New Jersey

NASPL EVENTS OTHER EVENTS

May 18 - 21, 2014 June 1 - 4, 2014 November 16 - 19, 2014 La Fleur’s 2014 Lottery La Fleur’s 2014 Lottery NASPL iLottery Game Symposium & Retailing Summit Conclave & Interactive Summit Developers Conference NEW! Grand Hyatt – Washington, DC Intercontinental Hotel Cleveland, Ohio Austin, Texas Co-Hosted by The Texas Lottery June 6 -8, 2014 NCLGS 2014 Summer Meeting June 17 - 20, 2014 The Hyatt Regency La Jolla June 7 - 11, 2015 NASPL ’14 Spring Directors Meeting & Dialogue San Diego, California European Lotteries (EL) Wentworth by the Sea Marriott Hotel 2015 EL Congress Portsmouth, New Hampshire Oslo, Norway Hosted by the New Hampshire Lottery July 11 - 12, 2014 National Council on Problem Gambling (NCPG) 28th National Conference July 21 - 25, 2014 on Problem Gambling NASPL ’14 Professional Development Seminar Orlando, Florida Sheraton Myrtle Beach Convention Center Hotel Myrtle Beach, South Carolina Hosted by South Carolina Education Lottery August 19 - 22, 2014 National Conference of State Legislatures NCSL Legislative Summit September 30 - October 3, 2014 Minneapolis, Minnesota NASPL ’14 Atlantic City, New Jersey Hosted by New Jersey Lottery November 2 - 5, 2014 World Lottery Summit 2014 World Lottery Association (WLA) and European Lotteries (EL) Rome, Italy Cavalier Convention Hotel INSIGHTS March/April 2014 83

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