Retail Executive Summit Nov. 5, 2013 May Scheve Reardon Executive Director, Missouri Lottery

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It Only Takes One!

PGRI Retail Executive Summit

Lotteries & Retailers Share the Same Goals, Challenges and Opportunities Mutual Goals 1.Build the brand 2.Attract new customers 3.Increase sales 4.Improve the bottom line

Mutual Challenges 1.Aging player base 2.Fewer cash customers 3.Lack of Lottery standardization 4.New distribution channels

Consumer Adoption of Technology Is Accelerating

Lottery Player Base Is Aging & Shrinking

Fewer Customers Carry Cash

There is a Lack of Standardization in the Lottery Business Model

There is a “Perceived Threat” of Alternative Sales Channels

Mutual Opportunities 1.Promote the Lottery brand and loyalty. 2.Introduce new technology and distribution channels. 3.Work to standardize Lottery operations.

Explore New Ways to Promote the Brand and Loyalty CY2012 contribution to education: $681,298 Mr. T’s – Cardwell, Mo. “We are so proud of our store’s sales and the support to education that we’ve generated. We hope to do even better next year.” -Nicole Poynor

Lottery Advertising Has a Positive Impact on “Brand Relevance”

Advertising Impacts Lottery Relevance Cell Phone100 Travel86 Google86 Cable TV85 Facebook 77 Coca-Cola 72 Missouri Lottery 71 McDonald’s 71 NFL 70 Casinos 61 Beer 57 Starbucks Cell Phone100 Cable TV87 Google85 Travel85 Facebook76 Coca Cola71 McDonald's 70 NFL67 Missouri Lottery66 Casinos58 Beer56 Starbucks FY12 FY13 Philanthropic ads Play It Forward has had a significant positive impact on the perception of Lottery relevance.

Retailers Are Changing and Embracing Consumer Demands Self-checkout/self-select and other operational cost reduction initiatives Digital in-store display and endless aisles Multi channel initiatives o Use of mobile in store o Click and pick Bring the store to the shopper

Use New Technology and Distribution Channels to Capture New Customers, Sales & Commissions

Work Together To Improve Standardization Of Lottery Licensing, Distribution and Accounting

Lottery and Retailer Collaboration Has Led to Record Sales and Commissions

How Can We Step Up Collaboration? What’s In Our Future?

Brick-and-Mortar Retail Will Always Be #1 To Lotteries CY2012 contribution to education: $209,273 Hy-Vee #1552 – St. Joseph, Mo. “We are so proud to be able to help sponsor and contribute to education. We measure our success not just on sales and profit, but also on how we improve the communities we are part of.” - Brad McAnally, Store Director

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Thank You!