2016 Industry Days: You Don’t Need a Digital Strategy – You Need a Business Strategy for the Digital Age
Hansjörg Höltkemeier, Chief Executive Officer, Deutsche Klassenlotterie, Berlin, President, European Lotteries Association (EL) thanks everyone for their service to the EL, to the sector, and for participating in Industry Days. Mr. Höltkemeier clarifies and emphasizes the theme of this event. It isn’t about digital, but about Retail. We are focused on the way in which digital supports and enhances Lottery’s Retail strategies. It is about applying digital technologies to the retail environment and using technology to augment and enhance the relationship with the consumer at retail. After all, our sector will continue to derive the vast majority of its sales from land-based retailers.
Younès El Mechrafi, General Director, La Marocaine des Jeux et des Sports (MDJS), General Secretary of the African Lotteries Association, welcomes us to the magnificent city of Marrakech and to Industry Days! Relates a wonderful parable about a man walking along the road and he sees another man cutting and breaking rocks and asks “What are you doing?” The man replies “I’m breaking stones.” He walks further along, sees another man breaking rocks and asks the same question. “I am making a living.” Further along, the third person is asked why he is breaking and cutting the rocks and he says “I am building a cathedral”. Who are we, what is our purpose – Are we cutting rocks, or are we building a cathedral? Let’s embrace our mission with the passion, meaning, and vision of one who is building a cathedral.
Ray Bates, Honorary President of the EL and Moderator Extraordinaire, introduces us to the format of Industry Days and what makes this a very different and special program. It is the successful collaboration between government-lottery operators and their commercial partners that makes this sector work. Industry Days is the platform to showcase the fruits of this partnership, to build the foundation for long-term growth and sustainability of the government-gaming sector.
Andy Duncan and Matt Godfrey describe the meaning and import of the EL Innovation Group. The Mission of the EL Innovation Group (ELIG) is to inspire and share innovation across the community of Lottery operators. By helping Lotteries to work together, the ELIG works to create the foundation for action and innovation-driven progress. It is a methodology workshop approach based on design thinking with the goal of giving participants practical tools to unlock the power of innovation. Follow the events section of European-lotteries.org to see the time, place, and agenda of the upcoming Innovation Group Seminars. Or e-mail email@example.com or firstname.lastname@example.org with questions, feedback or to register.
The underlying thesis of Industry Days: You don’t need a digital strategy. You need a business strategy for the digital age.
EL Partners IGT, INTRALOT, Scientific Games, Kambi, NOVOMATIC Lottery Solutions, and Playtech shared their vision for how Lottery is positioning itself for a prosperous and sustainable future.
In 1981, Bill Gates of all people is the one who said “640K ought to be enough for anybody”. Movies now stream into our iPhones at a rate that is literally 8,000 times faster than 640K, and we are not happy with anything less than that! As a sector, what are Lottery’s opportunities to invest in innovation that may not have a direct line from launch to ROI, but represent the wave of the future?
Change at Retail is evolutionary, but it is being driven by digital technology and consumer trends which are revolutionary. 94% of global consumer purchases continue to be at retail. The physical retail shopping experience is and will continue to appeal to the consumer. Technology is revolutionizing the consumer shopping experience by making it more entertaining, more engaging, and more convenient.
The beauty of the Lottery product is that it is much more intrinsically entertaining than the vast majority of CPG products. Lottery is entertaining, it’s fun. Why couldn’t that unique attribute be better leveraged to help our retail partners accomplish their goal to deliver a more entertaining shopping experience? Wouldn’t that enable Lottery to carve out a more relevant role for itself in the universe of land-based retailers? Further, Lottery strategies are already integrating internet, digital, and the physical in ways that are much more intrinsic to the product itself. Lottery could recast itself as the technology leader in the digital transformation of retail into an entertainment and consumer-engagement venue. Lottery can collaborate with major CPG brands to gamify the consumer experience. As we bring these ideas to life, the vision for how consumer behavior is changing the retail landscape can be turned into a reality that drives Lottery sales.
Omni-Experience to replace Omni-Channel.
“Channel” implies a separation that is being connected by a bridge. The millennials experience directly, valuing transparency, invisibility to the relationship between the tool and the experience. Our needs are being met by an on-demand, technology-enabled, and sharing economy. For the digital native, Off-line + Online = No-Line. There is no divide. For example, the distinction between the smart-phone that is used to order the Uber pick-up, the little dot that shows us where our driver is, and the actual riding experience becomes immaterial, all of it collapsing into one experience which is getting from here to there. There is only the fluid, integrated experience of connectivity and engagement across all media and channels.
SCALE is everything in sport-betting: Sport betting operators are merging to gain scale and reach and derive economies of scale and reach. Three companies will soon control 90% of the land-based market. Mergers are creating the scale that will become more and more formidable and make it more and more difficult for smaller operators to compete.
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