Risky Business – Time for Insurance?

Historically, state-sponsored lotteries have relied on the sheer volume of transactions, achieved through their monopoly status, to make the risk of paying big prizes reasonable. However, these advantages may be absent when a new game is started.  Other businesses have developed risk-sharing mechanisms, including insurance against specific risks.  ‘Synthetic’ lotteries like Lottoland have shown these can work in gaming. There maybe something to learn here, as I discuss in NASPL Insights August 2018.

Why Keno?

Keno, a traditional game with origins in Asia,  is a busy game: from a huge cast of characters (numbers 1 through 80) it scrambles 20 across the stage every drawing. It looks complicated for the player, with several different types of bet available. And yet, it thrives better than most draw games in settings where there is an opportunity to play every few minutes. Why? The math of the game supports the hopeful intuitions of players, as I show in NASPL Insights April 2018.

KenoLinka, the New and Better Keno

The most important innovation in draw games in decades goes by the name “Link2Win”. These game refreshingly simple and visually appealing in appearance, but beauty is more than skin-deep in this case: the mathematical properties of these games provide advantages unlike anything else I have seen. For a glance, look here; for a more thorough discussion check out my article in Gaming Intelligence, March 23, 2018.

The Age of Lotto

Are classic lottery games like Lotto evergreen– that is, will they continue to thrive indefinitely? This depends on whether the player population can be sustained into the future.There are two schools of thought about this: 1) Lotto play is something a player ages into; young people coming up will sustain it, and 2) Lotto play is a thing of the past; young people will not join. Looking at historical data from Washington, I show that age groups that now account for a significant share of spending played a lot less years ago.  However, the low level of engagement of the youngest age classes is unprecedented. The analysis supports hope but certainly not complacency for the future of these games.  NASPL Insights February 2018 

 

Outlook for the Big Games in 2018

In December, as I have done for several years now, I review what happened in Powerball and Mega Millions in the past year, and use math models to make some predictions about future behavior. The games became more similar in October 2017, when Mega Millions raised its price and changed its matrix. My outlook for 2018 is based on players responding much as they did when Powerball made similar changes in 2012. A key point from simulations is how broad is the range of “likely” outcomes- give or take half a billion in profit is about right!NASPL Insights December 2017

 

Engineering Instant Game Prize Structures: Results from Washington State

In lottery games repeat play is very important, and the prizes people actually win are particularly important in maintaining play of instant games. The cost of prizes is our greatest single cost, and tends to be challenged by auditors. Using quantitative visualization techniques described in NASPL Insights December 2013, the Washington Lottery redesigned its entire instant game portfolio and started fielding new-plan games in FY2016. Prize expense was reduced in key categories, yet the winning experience delivered to most players was improved. The financial and operational results were very positive through FY16 and FY17, as I describe in NASPL Insights Oct 2017

Testing Lottery Advertising: Both Wins and Draws Count

How is grand-scale research on lottery advertising like grand-scale research in agriculture? No one does it, who must thrive or fail according to the outcome. With my friend Jade I discuss tests of smaller scale, and we agree that there is usually something to be learned from a well-constructed test of advertising, even if the results are not what everyone wanted. After all, don’t we want to know what not to do? NASPL Insights August 2017

 

Daily Fantasy Sports: Entertainment, Information, and Gambling

European lotteries have had sports betting for some time, and have had to deal with the predictable problem of match-fixing. Daily Fantasy Sports is a US invention that caught fire in 2016, and that seems to avoid this hazard. The World Lottery Association asked me to write an explanation of Daily Fantasy Sports for a non-US audience. I was fascinated by how the sports-as-entertainment industry and the penetration of the Web changed how people talk about TV sports.This appeared as WLA Fantasy Sports summer 2017. 

Shouldn’t there be a measurement for that?

A lottery sales representative, Otto the Beer Guy, explained his view of the business to me. Since some Scratch tickets sell better than others, and it’s a good idea to make the most popular ones easiest to find. To help Otto, I developed a metric that compares games on their current popularity, making it easier for people to see which games may need more space. The metric is based on the retail standard of turn rate. NASPL Insights June 2017