SPAIN: Competition can boost the Lottery
As Spain’s lottery sector proves, Camelot need not be impregnable to competition just because the People’s Lottery has given up the ghost. It may even benefit from the challenge
The decision by Sir Richard Branson and his People’s Lottery consortium not to contest the award of a second seven-year licence to Camelot is understandable, given the effort put into the review process, as well as the fear that further delay and controversy might lead to good causes losing millions of pounds.
Whether or not a rival lottery now appears, the chances of it loosening the grip of Camelot, outside any statutory review process, appear slim, especially given Camelot’s new-found realisation of what it has to do to defend its position. As Sue Slipman, the company’s new external affairs director, said in a recent interview: “Camelot has eight years now and needs to mature as a company. We have examined our entrails and we’ll be a lot more confident going forward.”
It would be wrong, however, to assume that a dominant lottery player cannot be challenged by a rival, or that the emergence of a competitor would merely cannibalise, rather than develop the entire category, as happened in Spain.
Spain’s state-run lottery organisation, ONLAE, enjoyed monopoly status until restrictions on the development of competitive schemes were relaxed in 1977. It took time for a credible rival to emerge, but when one did it quickly captured the imagination of the public.
ONCE, a national charity for the blind, launched into the market in 1984, backed by an aggressive advertising campaign using a slogan still in use today: “La ilusión de todos los dÃas” – roughly translatable as “Excitement on a daily basis”. In addition to its advertising, ONCE introduced novel product features, such as competitive daily ticket prices and the promise of a double payout on Fridays.
Year after year ONCE renewed its proposition, each time backed by a hard-hitting promotional push. Eventually, prompted by the need to take its younger competitor more seriously, ONLAE commissioned research which found that, in the eyes of the Spanish, its association with the state made it seem antiquated and traditional.
But there was an encouraging sign for ONLAE. Within its portfolio of games there was one – the LoterÃa Primitiva – which had the potential to be perceived by the public as offering similar levels of interest to the schemes run by ONCE. ONLAE decided to concentrate its promotional efforts and appoint, for the first time, an advertising agency as a long-term partner rather than simply as a resource for one-off promotions.
Forced into such competitiveness, ONLAE now generates about 1trillion Pta (£3.8bn) a year, compared with ONCE’s 400bn Pta (£1.5bn). The market as a whole is producing advertising of such quality that campaigns from both companies were last year shortlisted for Spain’s prestigious Ampe awards, proving how astute and concerted marketing can bring new impetus to a market occupied by one, apparently dominant, player.
John Shannon is president of Grey International
