How does a state with 6,700 lottery retailers take a more customized approach to servicing them – and in the process generate a $30 million sales lift above goal?
Published November 19, 2024
For lotteries worldwide, the key to growth has always been pinpointing the right opportunities to meet their specific market challenges. Currently in North America, these may include flattening sales and a competitive landscape challenged by legalized sports betting and online casino play. In this environment, lotteries know that retail still represents a significant opportunity to compete and drive growth, yet retailer engagement varies — and not every retailer contributes equally. How can lotteries focus on retailers with the highest potential?
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This was the challenge taken up by New Jersey Lottery operator Northstar New Jersey (NSNJ) in fiscal year (FY) 2024. NSNJ launched a targeted plan that struck a balance between data and human intelligence to identify and focus on high-potential retailers. On the way to achieving a sales lift that was $30 million above the goal, NSNJ restructured its sales team, reshaped territories, and used IGT’s Sales Wizard tool to better serve retailers and grow sales. This approach may be useful for other lotteries to consider.
“As NSNJ evolves the Lottery Sales Representative (LSR) role, we recognized an opportunity to pilot a targeted approach to top performing, highly engaged retailers,” said John Hodor, Vice President of Sales, NSNJ. “There was an enhanced visit schedule combined with specific initiatives around retail execution.”
This new strategy employed 5 key changes:
1. Restructuring Sales Territories
In FY24, NSNJ reorganized its LSRs to create six districts, each managed by a supervisor overseeing 10 LSRs. The restructuring allowed LSRs to manage smaller groups of around 90 retailers each, increasing the frequency and focus of their visits.
2. Prioritization Based on Retailer Performance
Retailers were ranked into 10 groups (deciles) based on total sales (excluding multi-state jackpots), with top-performing retailers in the highest deciles receiving the most attention. This tiered approach allowed LSRs to focus efforts on high-opportunity stores, driving greater engagement and sales growth.
3. Enhanced Visit Frequency for High-Performing Retailers
Each LSR identified 25 high-performing retailers as “target retailers” and initiated weekly visits, allowing for in-depth discussions about business goals and better execution of lottery product sales.
“Due to more frequent visits, LSRs were able to have deeper conversations about retailers’ goals and aspirations,” said Hodor. “With a targeted approach for visit frequency and specific executable initiatives, we have seen encouraging results for the target retailers.”
4. LSR Tactics to Boost Sales
LSRs implemented a range of tactics to boost sales, including double/triple facing of popular games, winner-awareness promotions, and inventory managed to ensure the optimal price-point mix was implemented and the best selection of games was on display. Direct engagement with decision-makers enabled customized sales strategies tailored to each retailer’s goals.
5. Sales Wizard Enhancements
Sales Wizard, IGT’s lottery sales force automation tool, is designed to optimize field sales activities by providing insights into retailer performance. The tool played a pivotal role, allowing LSRs to adjust visit schedules based on dynamic retail conditions, maximizing opportunities by planning visits around events like game launches or specific store needs. This flexible system empowered reps to shift visit frequencies as needed, optimizing sales results in real-time.
Success Stats
The first year of implementation provided valuable insights and highlighted areas for improvement. The initial challenges included an adjustment period for both LSRs and retailers. By the second quarter, the reps and retailers had adapted to the new system.
• Q2 Sales: Exceeded goal by $16 million (4.6% above goal).
• Q3 Sales: Exceeded goal by $11.9 million (3.4% above goal).
• Q4 Sales: Exceeded goal by $3.4 million (1.1% above goal).
Overall Impact: The initiative generated more than $30 million above the sales goals assigned to target retailers in Q2-Q4.
What’s Next?
Starting in FY25, NSNJ plans to expand the weekly visit program to 40 retailers per LSR, incorporating additional retailers from lower deciles, to unlock further growth potential.
For more information, read the full case study here.
