Playing the right game during and beyond a crisis: The Lott
- 24 June, 2021 10:17
Balancing flexibility and routine, community contribution and the consumer’s desire for optimism proved instrumental for The Lott’s marketing team over the last 15 months. And they’re the keys to getting through this next normal, too.
The Lott was quick to activate its business continuity plan as Covid-19 struck in terms of logistics, supply chain, retailers and operations. However, head of brand, Ben Johnson, is the first to admit such finely tuned scenario planning couldn’t fully prepare brands for how customers were going to respond in a global pandemic.
“With such a big association of lottery alliances across the globe, we were keeping an eye on what was developing internationally, and refining our plans based on scenarios,” he told CMO. “For example, we were seeing New Zealand impacted a bit earlier, and shut down the entire retail lotteries business, while Malaysia was completely closed. We were hoping for the best and planning for the worst.”
Three main business objectives drove The Lott’s Covid-19 response: Deliver optimism to customers, maintain a strong and sustainable retail network, and continue generating state lottery taxes governments would need to fuel a recovery.
“But a gap we noticed early on was what customers expected of us,” Johnson said. “Until you’re faced with this environment, I don’t think that it’s something you can really plan for. Our view was one of the first questions to answer was whether we should continue advertising and it if was the right thing to do.”
Finding optimism in a crisis
The brand teams lent on research agency partner, Kantar, for insight, and found lotteries were more relevant than ever because of their role in fuelling optimism. The business owns several brands including Powerball, Lotto, Instant Scratch-Its and Oz Lotto.
“People wanted the freedom to dream about life’s possibilities,” Johnson said. “We also learnt they expected us to be business as usual. The insight was that in an increasingly uncertain world, consumers could rely on the routine of lotteries. Despite these things turning on their head, consumers wanted us to keep advertising so that they saw some things remained the same.”
Another driving force was the desire to keep supporting business and community. As Johnson pointed out, lotteries were created to generate revenues for community works. But even as feedback showed consumers expected The Lott to continue advertising, there was a renewed sense of responsibility, Johnson said. One way The Lott responded was to uplift brand advertising.
“Every state was dealing with its own restrictions... We also put that community standards lens on our advertising,” Johnson said. For example, in its campaign celebrating Mother’s Day, people coming to visit family physically were switched out to a video call. “The campaign fared really well for us,” he said.
Media messaging adapted state by state, metro versus regional, with agency partner, Carat, taking into account whole state lockdowns as well as localised areas and rapid changes in consumption. Investment shifted from out-of-home and radio and into screens and back again, decisions were made down to the individual panel and material was changing hour by hour.
Johnson said the team applied a “common sense check” to cope. “It was cost prohibitive to shoot different material for different markets and we knew it could be OK one week, but inappropriate the next,” he said.
“We urged on the side of caution and did what was safest. And where we needed to, we put statements into messaging saying this was filmed before Covid.”
Another position taken by The Lott was to support governments in each state’s health regulations messaging and programs. With 3000 retail points of presence, The Lott boasts of significant reach and Johnson said the organisation felt a responsibility to amplify those government messages as a result.
In addition, standalone community programs generated more than $6.6 million above and beyond state lottery taxes, a record level of support for The Lott in 2020. This was divvied up across heartland causes, health and education, as well as $1m donation to the University of Queensland’s vaccine research.
Measures of success
Through all of this, Johnson said brand tracking remained a key measure of success. The emphasis was on perceptions and attributes people were taking away from brands.
“The upweighting might not be as material as you think. For instance, if we were advertising a $10 million jackpot, instead of having 90 per cent of spots focused on the jackpot activity, it might have been 30 per cent brand, 70 per cent jackpot,” he explained. “It was important to keep messages going throughout rather than just be about the big jackpot event.”
Combined efforts saw The Lott grow sales revenue through 2020. “We know customers were seeking that optimism and daily moments of joy. That increase in relevance led to an increase in play frequency and increases in revenue through that period,” Johnson said.
A notable case was Instant Scratch-Its as people sought take-home entertainment. “At the same time, newsagents were reporting increases in puzzle books and crosswords, so this tied into that timeout conversation,” Johnson said.
Current state of play
As consumers started venturing out and returning to normal activities, sentiment has changed. Johnson pointed to digital and physical retail sales as a way of understanding the new norm.
The Lott saw growth in digital but also across its retail business. To ensure retailers benefit from digital growth, the company introduced an ‘omnichannel program’ a couple of years ago and revenue sharing commission model for eligible retailers meeting different milestones.
Again, increased weighting on all advertising channels was undertaken to ensure customers felt comfortable purchasing where they wanted to purchase, Johnson said. As Victoria opened up last year, The Lott further supported retail business with a ‘Shop local’ campaign, leveraging work done by the Australian Lotteries Association and the Small Business Council of Australia. The campaign encouraged people to get back into retail.
“We did see some retail outlets temporarily close and there was a natural move to digital, but we are seeing a bit of resurgence in the retail business,” Johnson said. “Digital is important but it’s about giving customers choice. We need to support all channels and make sure customers can buy in their preferred way.”
Other lessons for Johnson from the past 15 months are similarly customer and community oriented.
“If anything, it’s reminded us to remain true to the core purpose of lotteries. That’s to support the community and inspire Australians to dream,” he said. “One thing we have learnt through this period was this inherent entertainment factor to lotteries we haven’t necessarily taken to market. Because it is more about that anticipation and uplifting. That’s an interesting insight perhaps to explore.”
Another learning is the importance of that “daily moment of joy”. “People are taking the time to think about their dreams, what they want to achieve and life’s possibilities. That was a nice benefit of the time in those lockdown periods,” Johnson said.
“The other big thing was that growing sense of community and connection. We know from customers they have reacquainted themselves with the value of family and social networks.”
The Lott’s marketers will continue to be informed by customer insights as well as a need to adapt quickly, Johnson said. “We are lucky with our three agency partners including VML, that we can work quickly as speed to market was very important,” he continued.
“This time has made us realise how much we rely on each other and how our three key agencies partner with us. We use them to soundboard ideas, sense check and make sure we were doing the right thing.”
Johnson believed the days of “lobbing the brief to the agency and doing a big ta-da” are over.
“It’s about iterative processes, checking territories, tissue sessions and working on it together – it saves a lot of time in the creative process,” he said. “When we go into production, we want to use local businesses that don’t have all the layers and can deliver quickly for us.
“We have also upskilled our internal capability to help roll out things to market more quickly. So the role of agency is more around brand strategy, creative concepts and masters and then rolling out internally.”
With a brand refresh of The Lott Masterbrand timed to hit the market as the Tokyo Olympics commences, and Covid restrictions still very much part of our lives, Johnson and his team continue to learn from the last 15 months.
“A lot of it is refining and optimising what we are doing and continuing to position beautiful brands in market that inspire dreams while continuing to match media to consumption,” he said.
“It’s really consolidating the learnings from the last little while and understanding what still applies. We have just completed our FY22 planning process and you can see a lot of the lessons learnt from last year are still relevant - needing flexibility, the community and optimism aspects.”