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Online Lotteries: Making the Move
Moving lottery operations online is as loaded with dangers as it is with rewards and benefits. Betware has been an expert in this field for over 15 years…
Betware was founded by Stefan Hrafnkelsson and Ólafur Andri Ragnarsson in 1996 and began its operations by launching the first ever Internet-based gaming solution for state lotteries: the Icelandic Soccer Pools. It has since grown into an international company with a team of over 100 professionals based in Iceland, Denmark, Canada, Poland and Spain, while its headquarters have remained in Reykjavik. In its time Betware has been delivering a global platform to some of the most innovative national and state lotteries in Europe and North America, including Danske Spil, Islensk Getspa, British Columbia Lottery Corporation and Sistemas Tecnicos de Loterias del Estado (the operator of the online systems for the Spanish National Lottery).
“The company’s goal has always been to partner with customers for continuous innovation and market expansion,” says Ragnarsson, Betware founder and Chief Software Architect. “Betware’s fundamental belief is that the future of gaming is online so everything we do reflects this. At the core of Betware’s offering is a very versatile gaming platform that is secure, open and flexible to manage and integrate multiple game zones.”
In December 2010 Betware was awarded the Entrepreneur of the Year 2010 Award by the Icelandic Financial News, Vi∂skiptabla∂i∂. In March 2011 the company was nominated as the Lottery Software Supplier of the Year by eGaming Review Magazine.
LAND AHOY
Betware has become an expert when it comes to helping lottery operations make the move to online, as Ragnarsson explains: “The most difficult part of any operator going online is moving away from land-based thinking. There’s a fundamental difference as for land-based operations the retailer network is THE sales network, delivering 100% of the sales. The introduction of online lottery ticket sales may be seen as a threat to the retailers, so the challenge for any lottery is to make sure online sales do not cannibalize retailer sales but instead support and further increase them. It’s similarly crucial to prepare not only an Internet sales strategy but to coordinate it with all sales channels’ strategies, where each of the channels complements the other and appeals to a different target audience.”
Betware believes one aspect of transition that trips up most operators is the tendency to try and copy land-based business practices over to the online world, and that doesn’t work at all. “What they struggle with the most in the online zone is the fundamental nature of online gaming and what the “new players” in this zone expect or want,” explains Ragnarsson. “There’s a major technological transition that has taken place and the players expect certain elements to be implemented which are not considered in the traditional sales channels. The players expect that the online versions of their favorite games will be fully integrated with social media (Facebook, Twitter, etc.) allowing them to share their experiences with friends. Additionally it’s important to consider other issues such as enhanced responsible gaming, forgotten passwords, filling of wallets, etc.”.
The rapid growth of Internet gaming has left traditional land-based operators in an increasingly competitive environment, cutting down their market share and reducing player retention. Following the modern trends, the games and sales channels are evolving and moving online in search of a wider, younger audience. It’s therefore very important for lotteries to remain competitive by presenting a variety of games to attract players, as well as offering new interactive sales channels such as the Internet and mobile phones. It’s in this sector that Betware operates with unrivalled experience.
KNOWING ME, KNOWING YOU
“The benefits of Internet delivery for lotteries are clear,” says Ragnarsson. “The Internet provides an opportunity to tap into new sources of revenue other than those reached using traditional terminals. Addressing this interactive sales channel makes it possible to target younger groups of players, successfully compete with private market operators, increase revenues, and establish a solid market share. Betware´s technology offers not only new sales opportunities, but provides a completely new operator/player relationship.”
“Operators online have the opportunity to learn about players’ preferences and gaming behavior, and create products that capitalize on this full understanding of the target group and consumer trends. Being able to reach the player in action while they’re purchasing a ticket is a powerful marketing tool, allowing for direct communication and a variety of cross-promotions that are never possible with traditional sales channels.”
Betware also has the ability to introduce and conduct responsible gaming policies by limiting player losses, how often they play, and so on. This constant “dialogue” between the operator and player – which is not readily available for operators present only offline – helps to create more compelling products and therefore influences conversion and retention rates. To further enrich operators’ capabilities towards its players, Betware offers an eMarketing Toolkit which enables operators to create personalized marketing campaigns towards their players.
“The traditional approach of a land-based provider making its first steps towards an online solution is to offer a very limited platform built around one game or one game idea,” explains Ragnarsson. “A very simple platform that focuses on transactions and making sure that the money flows in right paths. These “platforms” are simple silos and are not expected to be enhanced by adding new types of games or features. They don’t have the potential to grow along with the lotteries needs and any customization is very expensive and time consuming. A classic example of such “simple platforms” is lottery subscriptions. These are available online as an extension to traditional central systems but can only handle subscriptions of a lottery game. These are not “live” systems but just a webpage front of a traditional central system.”
The market trends show that players are becoming more and more demanding; they expect to be able to buy their lotto tickets and play their favorite games at their own convenience. Players nowadays are “living their lives” online; becoming more aware of their options and demanding the products that fit their online presence. The younger generation is used to having the possibility to buy most of its services via the Internet, and with the expansion of Smart phones this will keep on growing.
STARTING UP
Betware’s platform allows operators to start their online presence no matter what the legal restrictions in their country are. Where online gaming is still not allowed it can be a ground to start building the players’ community by offering skill and casual gaming, game subscriptions or cross promotions. With the gaming market liberalization it allows on effortless transition of products into their online version opening up the new sales channel. From this foundation of a robust and secure yet flexible platform that has been tried and tested by multiple jurisdictions in the world, Betware develops games with a totally different view. Ragnarsson explains: “The traditional games may be thousands of years old but they are not reaching the younger audience nowadays. Betware focuses on delivering games in a new format with the values and expectations of the younger online player appealing to his/hers online and mobile needs, being always available, fast-paced and entertaining.”
