repared for: Maine Lottery cientific Games Maine Lottery Segmentation Study 6 Segment Solutions – Segment Overviews Prepared by: Simon Jaworski Sr. Vice President, Leger Lance Henik Sr. Account Manager Background and Objectives As with any market research endeavors, actionability is the key to any segmentation approach! To be successfully actionable, a segmentation study must address the following three key criteria:  Who They Are?  What Lottery Players Do?  Why They Do It? To this end, Leger’s objectives for the Maine Lottery Segmentation Study were to: 1. Allow the Lottery to use information attained in the segmentation study for strategic planning, product development, product enhancements, pricing, market positioning and communications. It is anticipated that this data will help the Lottery maximize revenue potential and minimize risk associated with new product introductions and product enhancements. 2. Learn the values, attitudes, motivations and lottery buying behavior of Maine adults which results in a division of the public into categories known as segments. 3. Find segments that could be easily understood yet differentiated from each other. Factors assessed but were not limited to: geographic, demographic, 2 Leverage This Segmentation To Its Fullest Potential! The Leger team believes the Maine Lottery has a tremendous opportunity to maximize the investment made and to leverage the insights garnered from this study. There are two primary considerations with regard to leveraging this segmentation study: o Buy-in  The key to a successful segmentation is internal ‘buy-in’ from as many departments as possible within an organization, on both the front-end and back-end of the segmentation as possible.  Leger’s most recent presentation with the Maine Lottery, which took place in June 2014, ensured this took place with the Lottery Director, along with heads of Marketing, Sales and Research teams, all having attended the initial segmentation session.  The Maine Lottery needs to embrace the results from top to bottom in the organization. o Maximizing Value and Opportunity  The segmentation should also maximize the opportunity for talking to the current (and future) base of Maine Lottery players.  This research offers the chance to talk to a wide ranging audience about potential new products, advertising and communications that are already in the pipeline. 3  This opportunity should not be passed up. Methodology Maine respondents participated in a 40 minute survey between March 5 and March 27, 2014. 1,013 completed the online survey The respondents all had to:  Be older than 18 years of age  Have no moral objections to Maine running a state lottery  Primary (or secondary) resident of Maine  Not work for an advertising agency, market research company, marketing consultant, any type of Lottery or a store that sells lottery tickets Margin of Error – Statistical Sample Accuracy at 90% confidence on n=1,013 completes is ± 2.6% 4 Project Review has based the timeline on a decision being made the week of August 18 th 2014 Approval of Project 2013 Final Decision Made on Segmentatio n Solution July 7th Final Questionnaire design and Questionnaire Programming Initial Segmentation report Delivered July 15th Maine Lottery Approval, PreTest, and Study Launch Segmentation Naming August 2014 Field period March 5th March 27th Data analysis, building of the Segments April Finalize Segmentation Names and Delivery of Final Segmentation Report September 2014 *Review of Segment Options via meeting at Maine Lottery June 3rd Provide the relevant shortform version(s) of the new Maine Lottery segments September 18th 5 Segmentation Specifics (1) o Leger utilizes exhaustive search criteria to surface segments which are more projectable:  Use broad  Add additional  Identify variables for modeling Model Run  Develop composite variables variable classes (attitudinal,  Determine model behavioral, etc.) fit and parsimony in models to examine initial clustering results. Model Run  Evaluate cluster profiling and model statistics as well as alternative numbers of clusters  Compare cluster membership and profiling across the exploratory results (e.g., how Factor/Principle well Component Analysis behaviorallybased clusters align with attitudinallybased clusters). class and evaluate improvement, fit and parsimony Model Run Cont’d  Re-iterate for better fit Discriminating  Variables Discriminating   “Bootstrap L2” – Classes random iterations to re-estimate the  Pull out nonp-value informative variables  Apply known class indicators 6 Segmentation Specifics (2) Leger aimed to surface segments that are: o Commercially significant, by being: o Large enough o Differentially responsive to potential marketing/sales programs and new product launches (such as new Instant Games) o Strategically actionable o Distinct and reproducible – avoiding artifacts of the analytic process o Identifiable and accessible – tactically actionable  Evaluate the refined model  Size and characterize the statistically valid segments  Discrimination Model Run Cont’d +  Use business knowledge to assign unclassified cases -  We use multiple techniques to surface key differentiating characteristics among segments including:  ANOVA  Discriminant analysis  CHAID 7 Segmentation Technical Overview (3) o o o o Considering the research objectives, Leger had the flexibility to recommending several segmentation options. The decision of exercising latent class segmentation or traditional clustering was made after data collection, so that the team could maximize the methodology to surface meaningful segments. Latent class clustering, Convergent Cluster Ensemble Analysis (CCEA), and traditional methods such as K-means clustering were used during the course of analytics. The final solution, however, was based on the CCEA segmentation – which involves a two step process. 1. Develop multiple cluster analyses that vary in terms of the clustering method employed (k-means, Hierarchical clustering using the number of clusters (ranging from 2 to 30) and the measures used. 2. Create ‘clusters’ and then ‘group’ respondents based on the analyses generated in the first step. While different Meta-Clustering Algorithms can be used to cluster respondents, CCEA Convergent Cluster & Ensemble Analysis uses k–means (a distance-based algorithm) to cluster respondents and create a consensus solution. A. This involves iterating from random but strategically chosen starting points; CCEA replicates each analysis ~30 times. B. Each replication is compared to every other to assess its reproducibility, and the most reproducible solution is selected. o The advantages of CCEA include: 1. Allows to combine groupings from alternate and dissimilar sets of variables (e.g., demographics, lifestyle batteries, desired benefits or needs, etc.); 2. Includes a variety of clustering techniques when building the ensemble in the first step (1 ); 3. Incorporates legacy clusters that are based on internal data; 4. Uncovers better, more robust cluster solutions that are less sensitive to sample variations and outliers; and 5. Allows to find solutions that would not have been uncovered using a single approach. References (for additional information): 8 Segmentation Specifics (4) o A Value-based segmentation (“VBS”) can help facilitate the Maine Lottery to create a five stage output, such as the one identified below, that will add value at every level of its business model: “what works with them” in terms of marketing messaging and positioning The Maine Lottery now has the opportunity to sculpt Marketing and Messaging plans by Segment. Lottery can now prioritize segments, based upon strategic goals – expanding player base, increasing purchase frequency, etc. PRIORITIZATION ING T E RK A M Identify segment(s) that demands acquisition, retention, or defection strategy. This is particularly important when managing and addressing competitive forces. ST RA AC TEG TIO IC N   Project segment membership of customers and noncustomers – Critical for future Maine research projects O CTI IDE NT DI PRE IFY Actionable and targetable segments. Leger N selected the optimal segmentation model, to maximize the segments power and precision. Prioritize marketing efforts according to segment potential on top-line. The Maine OUTPUT 9 What’s Next? Leger will provide the Maine Lottery with a post hoc segment classification tool (a.k.a. algorithm) based upon these segmentation results. This tool or algorithm will effectively and with reasonable accuracy reduce the original survey to a manageable subset of survey items permitting the classification of adults into their appropriate segment category in future research or other endeavors. Leger will provide this in two separate ways: 1. An MS-Excel format that Maine Lottery will be able to use to manually, in particular, for qualitative research. a) The excel file is an effective tool for screening respondents who are likely to fall within a specific and targeted segment for the purposes of in-depth qualitative research. 2. Leger can incorporate the short form algorithm into future online studies, including, but not limited to: a) Concept tests, b) Advertising tests, and c) General Attitude & Usage (A&U) Lottery tracking studies, conducted by Leger. a) Both the Colorado Lottery and Kentucky Lottery have had great success implementing their recent segmentation studies into their longitudinal Tracking Research studies. 10 Segment Sketches Faithful Followers – 26% “Heavy Powerball, scratch, but occasional draw game playership. They reinforce their self-respect by being loyal and working hard. They don’t mind taking risks, especially if it means they’ll fit in. A big opportunity segment” Communal Conservatives – 24% “This segment tends to play scratch games and multistate draw games. They are hard working, cautious when dealing with risk and deviating from their routine and patterns of living – yet they enjoy the social setting. A big opportunity segment” Social Spenders – 9% “While they play Scratch games more than anything else, save for Powerball this is the heaviest draw game playership segment. They are social butterflies, wellinformed to get the best deal and the most out of life. A critical, primary segment!” 11 Segment Sketches (2) Safely Silvers – 13% “The lowest playing segment – yet will play the multi-state draw games and scratch games when there is a big jackpot. They are in control, and focus on self-respect to be happy as they prepare for retirement. A challenging segment – one not to be ignored” Jackpot Junkies - 18% “Prefers multi-state draw games to hit the jackpot and scratch games. They are strong-willed with integrity and self respect; their pessimism to the lottery can be contradicted by a controlled spend in the hopes of hitting the jackpot. An important segment” Active Allies – 11% “Heaviest Scratch and Powerball playership segment. Convinced they have to look out for ‘A-#1,’ they work hard, are open to new ideas yet keep matters private as they strive and perhaps dream of financial security for their families. A critical, primary segment” 12 Maine Segmentation: Segmentation Size Overview Maine Lottery: 6 Segment Solution Faithful Followers 11% 18% 13% 26% Communal Conservatives Social Spenders 9% 24% Safely Silvers Jackpot Junkies Active Allies 13 Faithful Followers 26% PROFILE OF RESPONDENTS: PAST YEAR PLAY: 81% PAST MONTH PLAY: 52% SPEND PER MONTH: $27 GAMES PLAYED: Segment Characteristics:  Understands the value of hard work  Likes to give gifts whenever possible  Enjoys being social  Prefers to be busy rather than idle  41% “Spend the same amount on the same Playership indexes higher games”. Scratchdifferent Games.  32%on “Spend amount on different game each week”. 14 “Heavy Powerball, scratch, but occasional draw game playership. They reinforce their self-respect by being loyal and working hard. They don’t mind taking risks, especially if it means they’ll fit in. A big opportunity segment” I dream of winning big, but let’s face it that the dream will never come to pass. I’ll buy tickets at the last minute. I like big top prizes! Sure, the Lottery is honest, fun, and good for Maine. I like to keep busy. I like to have the computer pick my numbers. I work as hard as the next person. Faithfu l Follow ers I like to be entertained. I would buy a Scratch-off Game as a gift for another person. I enjoy being able to provide gifts to others. When necessary, I like to get the facts. I am optimistic. 15  Who are they?   The Middle of the Road  Over index on 18-34; under index on 55+  Average Income, Gender, Ethnicity – Very few characteristics separate this group demographically   What are their thoughts on life? (Sec A) I believe in working hard for what you earn (84%) #2 Before buying something, I like to make sure I am getting the best deal (67%) #2 I like to have plenty of options when I'm deciding what to do in my free time (54%) #2 I'm optimistic about the future (51%) #2 I want others to think of me as a success (47%) #2 I I like taking risks sometimes (30%) #2 I try to fit in with others (22%) #2 I often use credit cards for purchases (39%) #6 I consider myself very conservative when it comes to economic concerns (25%) #6 I always shop at the same stores (25%) #6 Shopping is a chore (13%) #6 I'm always looking for the next 'get rich quick'            Faithful Followers Values (Sec B)  Self-respect  Happiness  Loyalty  Social Status Not ‘Religion’ or ‘Community’ 16 Past - Play Average Spend Month Year Per Play Per Month Powerball 28% 47% $4 $5 Mega Millions 19% 68% $4 $7 Tri-State Megabucks 16% 41% $3 $3 Hot Lotto Sizzler 2% 8% $1 $1 Lucky For Life 6% 22% $1 $1 Gimme 5 2% 8% <$0 $1 Pick 3 3% 10% $1 $1 Pick 4 2% 7% <$0 $1 37% 64% $4 $8 Instant/Scratch Faithful Followers Key Drawing attributes (#1) reasons/differentiators When the jackpot is high (57%) #1 The name of the game (6%) #1 Drawing Game Attitudes (F1)  I use numbers of significance in my life including birthdays and ages of family members to pick my numbers (32%) #2  I enjoy playing in a pool because it gives me more chances to win (16%) #2  I used to play any jackpot amounts but now I only buy tickets when the jackpot amount is very large (23%) #3  I prefer to let the computer pick my numbers (43%) #5  I decide which numbers I will play before I go into the store (14%) #5  I purchase tickets for multiple drawings(7%) #5 17 Ever Played: 94% PAST Past Year: $1 $2 $3 78% % play: 66% Past Month: 45% Rank #5 #1 Faithful Follower YEAR PLAYERSHIP BY TICKET $ $5 $10 $20 73% 40% 42% 14% 5% #2 #2 #4 #3 “FAVORITE SCRATCH GAMES” by $ Faithful Followers Spend per play: $5 Spend per month: $13 Scratch Game Attitudes (G9)  The first thing I notice when I look at a Scratch-off Game is the name of the game (37%) #2  When choosing which Scratch-Off games to play, I check the Lottery website to see how many tickets with top prizes are still available (12%) #2  I would like to be able to buy a Scratch-off ticket on an I-Phone/I-Pad/Tablet (11%) #2  I expect to win more often than when I lose when playing Scratch-off Games (17%) #2  If I don't like the brand name on the Scratch-off ticket (i.e. Wheel of Fortune, Monopoly, etc.), I don't even consider buying that ticket (19%) #5  I have a set budget for Scratch-off Games every time I buy them (25%) #5  I find that some Scratch-Off games are too complicated - it is difficult to figure out if I won (13%) #5  I usually let the clerk pick out my Scratch-off Game tickets (6%) #5 18 “DAYS OF THE WEEK PLAY” % Monday 13% #6 Tuesday 19% #5 Wednesday 30% #5 Thursday 18% #4 Friday 42% #3 Saturday 48% #3 Sunday 12% #2 “DAY Play MOST OFTEN” - % Friday 28% Saturday 26% Wednesday 19% Faithful Followers “Where do they purchase?” Convenience 79% #2 (66% most often) Grocery 35% #6 Liquor 4% #2 Lottery & Gaming Attitudes (C1 & D2)  I would vote for the Lottery if there were an election today (73%) #3  It is important to me that proceeds from the Lottery go to a good cause (68%) #3  The Lottery is fun (49%) #3  When I bet money I want to be entertained, as well as have a chance to win a prize (48%) #3  I like the excitement of betting on games and sports (19%) #3  The Lottery is a form of gambling (68%) #6  Playing the Lottery can lead to compulsive gambling (23%) #5  The Lottery takes advantage of uneducated people (3%) #5  I worry that the Lottery will corrupt our society (2%) #5  Playing the Lottery is one thing I can do to help my family (<1%) #5 19  Media Habits  80% own a Laptop #1  60% own a Smartphone #2  48% own MP3 players #2  49% own a Web-enabled TV #3 53% 52% 49% 34% 33% 18% 10%  Radio – 5 Hours per week      57% Ever #3  11%/12% Past Week/Month #4  48% (T3B) Excellent website Internet Use per week  17 hours personal  8 hours professional  TV – 6 Hours per week 60% Faithful Followers VISIT Maine Lottery website? Local Radio 77% #2 iPod/MP3 33% #1 Pandora 29% #1 I Heart Radio 8% #1 Social Media – 53% use it daily  8.0 Hours Per Week 82% 44% 21% 16% 3% #2 #2 #2 #1 #1 Social Media Product/Brand Promotions  21% interested #3 20 Faithful Followers  Hobbies & Interests  Other Gaming activities Sweepstakes – 69% #2 47% 33% 45% 37% Raffles – 42% #2 Cards for $ – 20% #2 30% 25% 28% 26% Office Pool – 18% #2 Slots – 39% #3 Faithful Followe Blackjack via Internet – 17% #2 21% 19% 19% 20% 20% 21 Communal Conservatives Segment Characteristics: 24% PROFILE OF RESPONDENTS: PAST YEAR PLAY: 77% PAST MONTH PLAY: 48% SPEND PER MONTH: $27 GAMES PLAYED:  Cautiously Optimistic  Works just as hard as the neighbors  “Old school” - set in their ways  59% “Spend the same amount on the same games”. Playership indexes higher  22% “Spend different multi-state draw games amount on different game each week”. 22 “This segment tends to play scratch games and multi-state draw games. They are hard working, cautious when dealing with risk and deviating from their routine and patterns of living – yet they enjoy the social setting. A big opportunity segment” I’m not interested in purchasing instant tickets on my smartphone. It is important to keep an eye on the investments and the economy. Lucky Numbers? I’ll let the computer decide. I don’t disagree with the notion that the playing the Lottery is gambling. You have to be very lucky to win the Lottery. I’m more conservative than a risktaker. I prefer the routine. Communal Conservat ives Sure, I’ll join the company pool. I occasionally buy Scratchoff Games as gifts for others. I consider myself average. If given a choice, I’d prefer to win money over noncash prizes. I like to stick to a budget. 23 Communal Conservatives  Who are they?   Maried, 2nd oldest segment  Over index on 55-64; under index on 18-34  Heaviest female segment  Above average home owners   What are their thoughts on life? (Sec A) I believe you have to work for what you get in the world (79%) #1 I often use credit cards for purchases (45%) #2 Due to the current economy, I spend less on entertainment (43%) #2 Paying for advice from psychics or fortune-tellers is a waste of money (71%) #3 I enjoy giving gifts to others (66%) #6 It's important to me to save as much as I can for my retirement (51%) #6 I like to have plenty of options when I'm deciding what to do in my free time (40%) #6 I like to do things by myself (36%) #6 Investing in the stock market is much riskier than it used to be (34%) #6         Values (Sec B)  Trust  Truth  Responsibility  Emotional Security  Family Not ‘Creativity’ or ‘Persistence’ 24 Communal Conservatives Past - Play Average Spend Month Year Per Play Per Month Powerball 33% 48% $3 $4 Mega Millions 22% 64% $4 $8 Tri-State Megabucks 20% 39% $4 $4 Hot Lotto Sizzler 3% 10% $0 $1 Lucky For Life 7% 18% $1 $2 Gimme 5 2% 7% <$0 $1 Pick 3 1% 4% <$0 <$0 Pick 4 1% 4% <$0 <$0 19% 48% $4 $6 Instant/Scratch Key Drawing attributes (#2) reasons/differentiators It's a weekly ritual (18%) #2 I dream of winning big (44%) #3 Drawing Game Attitudes (F1)  I realize that in a pool group my portion of the jackpot would probably be much lower than the amount I could win if I bought tickets myself (67%) #1  I prefer to let the computer pick my numbers (55%) #1  I buy my tickets at the same retailer every time (23%) #3  I usually play the same numbers all the time (19%) #3  I used to play any jackpot amounts but now I only buy tickets when the jackpot amount is very large (18%) #5  I enjoy playing in a pool because it gives me more chances to win (8%) #5 25 Ever Played: 84% PAST Past Year: $1 $2 $3 63% Past Month: 24% % play: 68% Rank #4 #3 Communal Conservativ YEAR PLAYERSHIP BY TICKET $ $5 $10 $20 67% 21% 37% 16% 3% #5 #4 #2 #5 “FAVORITE SCRATCH GAMES” by $ Communal Conservatives Spend per play: $5 Spend per month: $13 Scratch Game Attitudes (G9)  I prefer Scratch-off Games with a big top prize (34%) #2  The first thing I notice when I look at a Scratch-off Game is the theme of the ticket (34%) #3  I have a set budget for Scratch-off Games every time I buy them (27%) #3  I would like to be able to buy a Scratch-off ticket on an I-Phone/I-Pad/Tablet (7%) #3  If I don't win a prize in the first few Scratch-off Games I buy, I usually stop buying that game (27%) #6  Scratch-off Games with small top prizes generally have more winners (23%) #6  If I don't like the brand name on the Scratch-off ticket (i.e. Wheel of Fortune, Monopoly, etc.), I don't even consider buying that ticket (19%) #6  I'm more likely to buy Scratch-off Games with a seasonal theme (12%) #6 26 Communal Conservatives “DAYS OF THE WEEK PLAY” % Monday 16% #4 Tuesday 24% #2 Wednesday 35% #4 Thursday 18% #5 Friday 37% #4 Saturday 49% #2 Sunday 9% #5 “DAY Play MOST OFTEN” - % Wednesday 29% Saturday 26% Friday 21% “Where do they purchase?” Convenience 76% #5 (64% most often) Grocery 40% #3 Liquor 2% #4 Lottery & Gaming Attitudes (C1 & D2)  It is important to me that proceeds from the Lottery go to a good cause (68%) #2  The Lottery is a form of gambling (71%) #3  Everyone who purchases a ticket to play the Maine Lottery has an equal chance of winning (60%) #3  The Maine Lottery is being run honestly (55%) #3  Having a Maine Lottery means keeping money in Maine that would otherwise have gone to other states (53%) #3  The Maine Lottery is being run in a businesslike manner (52%) #3  The Lottery has been an overall benefit to the state of Maine and its citizens (51%) #3  Playing the Lottery can lead to compulsive gambling (21%) #6  I like to know that my chances of winning something are in my control, and not just luck (17%) #6 27 Communal Conservatives  Media Habits  55% own a Tablet #2  48% own a cellphone #3  53% play online games #5  49% own a desktop computer #6 VISIT Maine Lottery website?  54% Ever #4  13%/13% Past Week/Month #3  54% (T3B) Excellent website  TV – 6 Hours per week Internet Use per week  14 hours personal  8 hours professional 58% 58% 56% 52% 52% 31% 19% 8%  Radio – 6 Hours per week  Local Radio  CDs  Other 73% #4 3% #2 7% #2 Social Media – 38% use it daily  5.0 Hours Per Week 71% #5 21% #1 18% #3 15% #3 None 13% #2 Social Media Product/Brand Promotions  12% interested #5 28 Communal Conservatives  Hobbies & Interests  Other Gaming activities Out of state casino – 23% #2 52% 28% 48% 38% Sweepstakes – 63% #3 Raffles – 58% #3 23% 16% 23% 22% Tribal Casinos– 18% #3 Video Poker– 11% #3 Blackjack in casino – 11% #3 18% 13% 12% 29 Social Spenders Segment Characteristics: 9% PROFILE OF RESPONDENTS: PAST YEAR PLAY: 87% PAST MONTH PLAY: 69% SPEND PER MONTH: $79 GAMES PLAYED:  Living life to the fullest  Leaders - “Movers n Shakers”  Strongest advocates of the Lottery  33% “Spend the same amount on the same games”.  27% “Spend different Playership Over-Indexes amount on different game Every Game! each On week”. 30 “While they play Scratch games more than anything else, save for Powerball this is the heaviest draw game playership segment. They are social butterflies, wellinformed to get the best deal and the most out of life. A critical, primary segment.” When it comes to scratch games, the themes, as well as ability to win small prizes, is important. The rush I get from Lottery games is exciting! “No Risk, No Reward!” I get excited when I gamble or play the Maine Lottery. Livin’ and Lovin’ Life! I enjoy the latest gadgets. Social Spend ers I am a strong advocate for the Maine Lottery. I am extremely brand loyal. I play not only just to win and win big, but to be entertained. I am well informed about the odds of each of the games. I like getting the facts to be wellinformed, so as to give me a competitive edge. Follow me, I’m the leader. 31 Social Spenders  Who are they?  Youngest segment: Over index on 18-34 year olds  Over index on males (Highest % male segment)  Renters  Highest ‘full-time’ employment segment.    What are their thoughts on life? (Sec A) I am always looking for a bargain (76%) #1 Before buying something, I like to make sure I am getting the best deal (74%) #1 I seek out all relevant facts when making decisions (73%) #1 I like to try new products (72%) #1 I'm usually willing to try something that's 'new and different' (72%) #1 I like to make up my mind after thinking carefully (71%) #1 I like to be entertained (71%) #1 I consider myself brand loyal to products I know and like (71%) #1 I believe in working hard for what you earn (77%) #6 Paying for advice from psychics or fortune-          Values (Sec B)  Friendships  Happiness  Sense of humor  Sense of humor  Planning for the future  Optimism Not ‘Ethics’ or ‘Privacy’ 32 Social Spenders Past - Play Average Spend Month Year Per Play Per Month Powerball 40% 59% $7 $14 Mega Millions 37% 63% $5 $12 Tri-State Megabucks 22% 40% $3 $7 Hot Lotto Sizzler 11% 22% $2 $4 Lucky For Life 19% 37% $3 $8 Gimme 5 16% 30% $2 $4 Pick 3 17% 30% $2 $4 Pick 4 11% 19% $1 $3 Instant/Scratch 52% 70% $12 $23 Key Drawing attributes #1 reasons/differentiators Odds of winning (37%) #1 # of ways to win or play (20%) #1 Drawing Game Attitudes (F1)  I use numbers of significance in my life including birthdays and ages of family members to pick my numbers (43%) #1  I buy my tickets on the same day as the drawing (37%) #1  I decide which numbers I will play before I go into the store (36%) #1  I buy my tickets at the same retailer every time (35%) #1  I used to play any jackpot amounts but now I only buy tickets when the jackpot amount is very large (33%) #1  I enjoy playing in a pool because it gives me more chances to win (33%) #1  I prefer to let the computer pick my numbers (39%) #6 33 Ever Played: 92% PAST Past Year: $1 $2 $3 81% % play: 52% Past Month: 60% Rank #6 #5 Social Spender YEAR PLAYERSHIP BY TICKET $ $5 $10 $20 60% 43% 62% 30% 10% #1 #1 #1 #1 “FAVORITE SCRATCH GAMES” by $ Social Spenders Spend per play: $9 Spend per month: $32 Scratch Game Attitudes (G9)  I see Scratch-off Games as a form of entertainment in addition to a chance to win a prize (76%) #1  I would buy a Scratch-off Game as a gift for another person (73%) #1  I give Scratch-Off tickets as Christmas presents (70%) #1  The prizes on Scratch-off Games give me the feeling of a 'winning experience' (60%) #1  The dollar amount of the top prize influences which Scratch-off Games I will buy (59%) #1  I prefer Scratch-off Games with a big top prize (57%) #1  I get an adrenalin rush when I win a prize playing Scratch-off Games (57%) #1  I find that some Scratch-Off games are too complicated - it is difficult to figure out if I won (25%) #1 34 Social Spenders “DAYS OF THE WEEK PLAY” % Monday 25% #1 Tuesday 21% #4 Wednesday 42% #2 Thursday 26% #2 Friday 61% #1 Saturday 47% #4 Sunday 11% #4 “DAY Play MOST OFTEN” - % Wednesday 28% Saturday 28% Friday 21% “Where do they purchase?” Convenience 81% #1 (59% most often) Grocery44% #1 Liquor 8% #1 Lottery & Gaming Attitudes (C1 & D2)  The Maine Lottery is being run in a businesslike manner (73%) #1  When I bet money I want to be entertained, as well as have a chance to win a prize (62%) #1  I like the excitement of betting on games and sports (60%) #1  Advertising for Maine Lottery games is memorable (50%) #1  Gambling is a good way to boost the economy (49%) #1  I like to know that my chances of winning something are in my control, and not just luck (38%) #1  Playing the Lottery is one thing I can do to help my family (31%) #1  The Lottery is a form of gambling (69%) #5  It is important to me that proceeds from the Lottery go to a good cause (59%) #6 35 Social Spenders  Media Habits  70% own a Desktop #1  68% own a smartphone #1  56% own a tablet #1  77% play online games #1  76% read newspapers #1  TV – 7 Hours per week 63% 32% 32% 30% 22% 18% 6%  Radio – 7 Hours per week  Local Radio 79% #1  Pandora 24% #3  I Heart Radio 6% #2 VISIT Maine Lottery website?  78% Ever #1  24%/22% Past Week/Month #2/#3  60% (T3B) Excellent website Internet Use per week  21 hours personal  9 hours professional Social Media – 48% use it daily  12 Hours Per Week 82% 23% 17% 9% 7% #3 #1 #1 #1 #1 Social Media Product/Brand Promotions  30% interested #2 36 Social Spenders  Hobbies & Interests  Other Gaming activities Slots in a casino – 46% #1 32% 22% 28% 23% Bingo – 44% #1 Cards for $ – 33% #1 21% 18% 20% 20% Bet on sporting events – 33% #1 Slot machine via app – 30% #1 Video Poker via app– 30% #1 17% 10% 10% 13% 12% Out of state casino – 28% #1 37 Safely Silvers Segment Characteristics: 13% PROFILE OF RESPONDENTS: PAST YEAR PLAY: 35% PAST MONTH PLAY: 14% SPEND PER MONTH: $3 GAMES PLAYED:  Lowest Playership segment  Socially, they keep to themselves  Values-driven; rather conservative  Concerned about gambling  66% “Spend the same amount on the same games”. Despite past-year  25% under-index “Spend different playership, amount on different game 10%each of this segment play these week”. games! 38 “The lowest playing segment – yet will play the multi-state draw games and scratch games when there is a big jackpot. They are in control, and focus on self-respect to be happy as they prepare for retirement.” A challenging segment – one not to be ignored ” I’ll occasionally purchase Scratch-Off games as gifts. I am a creature of habit. It’s about luck, and I’m rarely lucky. There is nothing exciting about playing the Lottery. Big prizes don’t interest me because I know I’m not going to win. I’m a pessimist. Safely Silvers I play when there is a big jackpot. I don’t play the lottery much…and I don’t care. I worked too hard in my life to risk losing what I have. I am cautious about the economy but know it’s important to I am invest. not worried about my friends, or fitting in for that matter. Lottery = Gambling 39 Safely Silvers  Who are they?  Values (Sec B)  Oldest age group, highest % of 55+ (particularly  Integrity  Truth 65+)  Ethics  Responsibility  Best education index (Post Graduate)  Generosity  Highest number of retirees Not ‘Independence’ or ‘Happiness’  Heavy over-index on being ‘single’   What are their thoughts on life? (Sec A) Paying for advice from psychics or fortune-tellers is a waste of money (82%) #1 I don't care what others think about my social status (61%) #1 It's important to me to save as much as I can for my retirement (57%) #1 Shopping is a chore (31%) #1 There really is no such thing as luck (27%) #1 I like to do things that are relaxing (66%) #6 I am always looking for a bargain (58%) #6 I have to look out for myself because the government won't do it for me (47%) #6 I like to be entertained (38%) #6 I consider myself brand loyal to products I know and like (38%) #6 I'm optimistic about the future (37%) #6           40 Safely Silvers Past - Play Average Spend Month Year Per Play Per Month Powerball 8% 13% $1 <$0 Mega Millions 5% 22% $1 $1 Tri-State Megabucks 2% 11% <$0 $1 Hot Lotto Sizzler 1% 2% $3 <$0 Lucky For Life 1% 1% <$0 <$0 Gimme 5 0% 1% <$0 <$0 Pick 3 0% 2% <$0 <$0 Pick 4 0% 0% $0 $0 Instant/Scratch 4% 15% $0 $1 Key Drawing attributes (#2) reasons/differentiators Cost of ticket (56%) #2 Drawing Game Attitudes (F1)  I prefer to let the computer pick my numbers (53%) #2  I enjoy playing in a pool because it is a social connection with friends, coworkers or family (14%) #2  I purchase tickets for multiple drawings (AP - Advanced Play) (8%) #3  I used to play any jackpot amounts but now I only buy tickets when the jackpot amount is very large (14%) #6  I buy my tickets on the same day as the drawing (11%) #6  I decide which numbers I will play before I go into the store (8%) #6 41 Ever Played: PAST 72% $1 $2 $3 Past Year: % play: 75% 44% Rank #1 #6 Past Month: 11% Safely$ Silvers YEAR PLAYERSHIP BY TICKET $5 $10 $20 45% 10% 20% 10% 0% #6 #6 #5 #6 “FAVORITE SCRATCH GAMES” by $ NA Safely Silvers Spend per play: $2 Spend per month: $4 Scratch Game Attitudes (G9)  I usually let the clerk pick out my Scratch-off Game tickets (25%) #1  Scratch-off Games with small top prizes generally have more winners (45%) #2  I would be likely to purchase a ticket with a geographic theme (e.g., about Maine) (30%) #2  I vary where and how I purchase my Scratch-off tickets to increase my odds of winning (10%) #3  I would buy a Scratch-off Game as a gift for another person (45%) #6  I expect a bigger prize when I buy a higher price point Scratch-off ticket (40%) #6  I like the Scratch-off Games because you know immediately if you have won (40%) #6  I give Scratch-Off tickets as Christmas presents (25%) #6  The dollar amount of the top prize influences which Scratch-off Games I will buy (15%) #6 42 Safely Silvers “DAYS OF THE WEEK PLAY” % Monday 14% #5 Tuesday 13% #6 Wednesday 28% #6 Thursday 11% #6 Friday 31% #6 Saturday 39% #6 Sunday 5% #6 “DAY Play MOST OFTEN” - % Friday 27% Wednesday 20% Saturday 20% “Where do they purchase?” Convenience 72% #6 (64% most often) Grocery 36% #5 Liquor 2% #6 Lottery & Gaming Attitudes (C1 & D2)  Playing the Lottery can lead to compulsive gambling (46%) #1  Most of the people who win a lot of money in the Lottery end up less happy than they were before (29%) #1  The Lottery is a form of gambling (80%) #2  The Lottery takes advantage of the poor (32%) #2  I like to know that my chances of winning something are in my control, and not just luck (31%) #2  The Lottery takes advantage of uneducated people (27%) #2  Mostly suckers play the Lottery (23%) #2  I am concerned about friends or relatives spending too much money on the Lottery (17%) #2  I am a good source of information on lottery games (1%) #6 43  Playing the Lottery is one thing I can do to help my family (3%) #5 Safely Silvers  Media Habits  79% own a Desktop  51% own a cellphone  47% play online games  69% read newspapers  TV – 5 Hours per week 54% 42% #2 #2 #6 #6 Internet Use per week  16 hours personal  7 hours professional 41% 40% 36% 31% 19% 8% Local Radio iPod/MP3 Pandora CDs Social Media – 41% use it daily  5 Hours Per Week 69% 17% None  Radio – 4 Hours per week     VISIT Maine Lottery website?  16% Ever #6  2%/4% Past Week/Month #6  29% (T3B) Excellent website 66% #6 30% #2 28% #2 3% #1 #6 #3 14% #1 Social Media Product/Brand Promotions  8% interested #6 44 Safely Silvers  Hobbies & Interests  Other Gaming activities Raffles – 40% #6 48% 25% 47% 32% Sweepstakes – 36% #6 Slots – 8% #6 24% 22% 24% 23% 20% 17% 13% Cards for $ – 8% #6 45 Jackpot Junkies Segment Characteristics: 18% PROFILE OF RESPONDENTS: PAST YEAR PLAY: 66% PAST MONTH PLAY: 38% SPEND PER MONTH: $17 GAMES PLAYED:  “Middle of the Roaders”  Jackpot chasers – not interested in small prizes  Work hard to enjoy their downtime  45% “Spend the same amount on the same games”.  28% “Spend different Similar to on Safely Silvers,game this amount different segment under-indexes on each week”. most games. 46 “Prefers multi-state draw games to hit the jackpot and scratch games. They are strong-willed with integrity and self respect; their pessimism to the lottery can be contradicted by a controlled spend in the hopes of hitting the jackpot. An important segment” On occasion, I’ll buy some Scratch-Off games as gifts for other people. I’m concerned about online security, let along mobile lottery purchases. Small prizes don’t excite me. I am an infrequent player of lottery games. Bet with your head, not over it. I don’t like to shop. Jackpo t Junkie s You have to be lucky to win. I play to chase a big jackpot – lots of cash! I’m too busy working hard to worry about other people. The lottery is gambling. The lottery takes advantage of the poor; and not good for Maine. I enjoy my downtime. 47 Jackpot Junkies  Who are they?  Highest income (and College Grad) group  Moderate over index on 55+ (under index on 18-34 & 35-54)  Other demographics (Marital status, home ownership, people per household, full time employment) are in line with the average for the state of Maine.    What are their thoughts on life? (Sec A) I often use credit cards for purchases (52%) #1 I believe you have to work for what you get in the world (79%) #2 Paying for advice from psychics or fortune-tellers is a waste of money (76%) #2 I seek out all relevant facts when making decisions (66%) #2 I like to invest my money (38%) #2 Others consider me to be a leader (35%) #2 There really is no such thing as luck (20%) #2 I enjoy giving gifts to others (66%) #5 I don't care what others think about my social status (53%) #5 I consider myself very liberal when it comes to social         Values (Sec B) Self-respect  Emotional Security  Integrity  Ethics  Privacy Not ‘Friendships’ or ‘Social Status’   48 Jackpot Junkies Past - Play Average Spend Month Year Per Play Per Month Powerball 20% 51% $2 $2 Mega Millions 13% 40% $3 $5 Tri-State Megabucks 12% 30% $3 $3 Hot Lotto Sizzler 2% 4% <$0 <$0 Lucky For Life 4% 16% $1 $1 Gimme 5 3% 6% <$0 <$0 Pick 3 2% 3% <$0 $1 Pick 4 3% 5% <$0 $1 20% 41% $2 $4 Instant/Scratch Key Drawing attributes #1 reasons/differentiators When the jackpot is over $100m (40%) #1 Drawing Game Attitudes (F1)  I used to play any jackpot amounts but now I only buy tickets when the jackpot amount is very large (26%) #2  I prefer to let the computer pick my numbers (52%) #3  I use hunches to pick lucky numbers (9%) #3  I use numbers of significance in my life including birthdays and ages of family members to pick my numbers (18%) #6  I buy my tickets at the same retailer every time (8%) #6  I enjoy playing in a pool because it is a social connection with friends, coworkers or family (6%) #6 49 Ever Played: 81% PAST Past Year: $1 $2 $3 62% % play: 69% Past Month: 30% Rank #3 #4 Jackpot Junkie YEAR PLAYERSHIP BY TICKET $ $5 $10 $20 66% 22% 34% 9% 3% #4 #5 #6 #4 “FAVORITE SCRATCH GAMES” by $ Jackpot Junkies Spend per play: $5 Spend per month: $11 Scratch Game Attitudes (G9)  If I don't win a prize in the first few Scratch-off Games I buy, I usually stop buying that game (31%) #2  If I don't like the brand name on the Scratch-off ticket, I don't even consider buying that ticket (26%) #2  I find that some Scratch-Off games are too complicated - it is difficult to figure out if I won (18%) #3  I expect to win more often than when I lose when playing Scratch-off Games (16%) #3  I usually let the clerk pick out my Scratch-off Game tickets (15%) #3  I like the Scratch-off Games because you know immediately if you have won (61%) #4  I have a set budget for Scratch-off Games every time I buy them (24%) #6  The first thing I notice when I look at a Scratch-off Game is the name of the game (15%) #6 50 Jackpot Junkies “DAYS OF THE WEEK PLAY” % Monday 19% #3 Tuesday 23% #3 Wednesday 37% #3 Thursday 21% #3 Friday 36% #5 Saturday 44% #5 Sunday 11 #3 “DAY Play MOST OFTEN” - % Saturday 30% Wednesday 22% Friday 18% “Where do they purchase?” Convenience 77% #4 (48% most often) Grocery 36% #4 Liquor 2% #5 Lottery & Gaming Attitudes (C1 & D2)  The Lottery is a form of gambling (84%) #1  The Lottery takes advantage of the poor (43%) #1  The Lottery takes advantage of uneducated people (42%) #1  Mostly suckers play the Lottery (25%) #1  I am concerned about friends or relatives spending too much money on the Lottery (18%) #1  Playing the Lottery can lead to compulsive gambling (41%) #2  It is important to me that proceeds from the Lottery go to a good cause (65%) #5  Everyone who purchases a ticket to play the Maine Lottery has an equal chance of winning (46%) #5  The Lottery is harmless entertainment (8%) #6  Playing the Lottery is one thing I can do to help my family (0%) #6 51 Jackpot Junkies  Media Habits  57% own a smartphone  54% own a tablet #3  75% read newspapers #3 #2  TV – 5 Hours per week 55% 48% 46% 41% 35% VISIT Maine Lottery website?  44% Ever #5  8%/9% Past Week/Month #5  34% (T3B) Excellent website Internet Use per week  18 hours personal  8 hours professional Social Media – 47% use it daily  6 Hours Per Week 30% 18% 11%  Radio – 4 Hours per week  Local Radio  iPod/MP3  Satellite radio 72% #5 27% #4 16% #1 74% #4 19% #2 35% #4 None 9% #3 Social Media Product/Brand Promotions  15% interested #4 52 Jackpot Junkies  Hobbies & Interests  Other Gaming activities Raffles – 50% #5 49% 35% 46% 39% Sweepstakes – 55% #5 Office Pool – 14% #4 31% 15% 26% 12% 12% 25% Racetrack – 8% #4 53 Active Allies Segment Characteristics: 11% PROFILE OF RESPONDENTS: PAST YEAR PLAY: 92% PAST MONTH PLAY: 79% SPEND PER MONTH: $62 GAMES PLAYED:  Strong Maine Lottery Advocates  Dreams big, loves small wins  Work hard, play hard  Will take a chance and try something new  41% “Spend the same amount on the same games”. P12M Playership vs. Social Spenders  36% “Spend (Heavy Playerdifferent Segment): amountPowerball, on different game Over-Index: Scratch, Tri-State Megabucks each week”. Similar Playership Levels: Mega Millions, Lucky For Life Under-Index: Gimme 5, Pick 3/Pick 4, Hot Lotto 54 “Heaviest Scratch and Powerball playership segment. Convinced they have to look out for ‘A-#1,’ they work hard, are open to new ideas yet keep matters private as they strive and perhaps dream of financial security for their families. A critical, primary segment.” I enjoy the themes, the entertainment I get, and immediacy of winning that ScratchOff games offer. I prefer to pick my own scratch tickets. I’ll buy tickets for games on impulse, or at the last minute. I dream of winning big, and if I get just a small win that is fantastic! I am trying to get the most out of life! I’ll take a chance, once in a while. Sometimes, the stars do align! Active Allies I am fairly competitive, and I work hard for what I earn. I like modern technology like everyone else. I am an advocate for the Maine Lottery. The Main Lottery is harmless…it’s fun! I’m fairly optimistic. 55 Active Allies              Who are they?  Largest ‘family’ segment  Highest number of children  Heavy over index on 35-54 age group. Values (Sec B)  Privacy  Independence  Family Relationships Loyalty  Financial Security  Trust Not ‘Optimism,’ ‘Responsibility,’ or What are their thoughts on life? (Sec A) ‘Generosity’ I believe in working hard for what you earn (85%) #1 I like to do things that are relaxing (81%) #1 I enjoy giving gifts to others (80%) #1 Investing in the stock market is much riskier than it used to be (66%) #1 I have to look out for myself because the government won't do it for me (65%) #1 I am more likely to try a new activity if it requires little effort (32%) #1 Before buying something, I like to make sure I am getting the best deal (63%) #6 I seek out all relevant facts when making decisions (52%) #6 I like to make up my mind after thinking carefully (49%) #6 I like to research all options carefully before making a purchase (48%) #6 Others consider me to be a leader (25%) #6  56 Active Allies Past - Play Average Spend Month Year Per Play Per Month Powerball 45% 58% $3 $8 Mega Millions 35% 82% $4 $9 Tri-State Megabucks 30% 56% $6 $8 5% 12% $0 $1 16% 37% $2 $4 Gimme 5 9% 16% $1 $2 Pick 3 8% 18% $1 $5 Pick 4 7% 12% $1 $3 58% 81% $6 $22 Hot Lotto Sizzler Lucky For Life Instant/Scratch Key Drawing attributes #1 reasons/differentiators Ease of play (38%) #1 It's a weekly ritual (20%) #1 I dream of winning big (47%) #1 I play my lucky numbers (21%) #1 #of prizes available (19%) #1 Cost of ticket (59%) #1 Drawing Game Attitudes (F1)  I usually play the same numbers all the time (24%) #1  I buy my tickets on the same day as the drawing (27%) #2  I buy my tickets at the same retailer every time (25%) #2  I decide which numbers I will play before I go into the store (20%) #2  I realize that in a pool group my portion of the jackpot would probably be much lower than the amount I could win if I bought tickets myself (45%) #6 57 Ever Played: PAST 96% $1 $2 $3 Past Year: % play: 70% 88% Rank #2 #2 Past Month: 62% Active YEAR PLAYERSHIP BY TICKET $ Allies $5 $10 $20 69% 35% 38% 16% 9% #3 #3 #3 #2 “FAVORITE SCRATCH GAMES” by $ Active Allies Spend per play: $5 Spend per month: $27 Scratch Game Attitudes (G9)  I expect a bigger prize when I buy a higher price point Scratch-off ticket (73%) #1  I like the Scratch-off Games because you know immediately if you have won (72%) #1  I would buy a Scratch-off Game as a gift for another person (69%) #2  I see Scratch-off Games as a form of entertainment in addition to a chance to win a prize (60%) #2  I give Scratch-Off tickets as Christmas presents (53%) #2  The first thing I notice when I look at a Scratch-off Game is the top prize (49%) #2  The first thing I notice when I look at a Scratch-off Game is the theme of the ticket (45%) #2  If I don't win a prize in the first few Scratch-off Games I buy, I usually stop buying that game (28%) #5  I usually let the clerk pick out my Scratch-off Game tickets (6%) #6 58 Active Allies “DAYS OF THE WEEK PLAY” % Monday 23% #1 Tuesday 35% #1 Wednesday 46% #1 Thursday 28% #1 Friday 48% #2 Saturday 55% #1 Sunday 19% #1 “DAY Play MOST OFTEN” - % Saturday 31% Friday 27% Wednesday 15% “Where do they purchase?” Convenience 79% #3 (76% most often) Grocery42% #2 Liquor 3% #3 Lottery & Gaming Attitudes (C1 & D2)  I would vote for the Lottery if there were an election today (94%) #1  Having a Maine Lottery means keeping money in Maine that would otherwise have gone to other states (85%) #1  The Lottery has been an overall benefit to the state of Maine and its citizens (83%) #1  The Lottery is fun (83%) #1  Everyone who purchases a ticket to play the Maine Lottery has an equal chance of winning (79%) #1  The Maine Lottery is being run honestly (76%) #1  The Maine Lottery has done a good job raising money for Maine programs (75%) #1  Maine Lottery proceeds go to a good cause (71%) #1  It is important to me that proceeds from the Lottery go to a good cause (70%) #1  The Lottery is harmless entertainment (66%) #1 59 Active Allies  Media Habits  61% own a cellphone #1  57% own a web enabled TV #1  66% Play Online games #2  44% own a smartphone #6  TV – 7 Hours per week 69% 58% Internet Use per week  20 hours personal  10 hours professional 54% 37% 34% VISIT Maine Lottery website?  75% Ever #2  25%/22% Past Week/Month #1/#2  65% (T3B) Excellent website Active Social Media – 54% use it daily Allies  6 Hours Per Week 32% 15%  Radio – 7 Hours per week  Local Radio  iPod/MP3  Satellite radio 76% #3 29% #3 15% #2 84% 45% 26% 16% #1 #1 #1 #2 Social Media Product/Brand Promotions  34% interested #1 60 Active Allies  Hobbies & Interests  Other Gaming activities Sweepstakes – 75% #1 52% 31% 48% 34% Raffles – 62% #1 Slots in Casinos – 40% #2 28% 17% 18% 18% Slots via app – 25% #2 Bingo – 24% #2 Bet on sporting events – 22% #2 16% 12% 61 Appendix Short Form Segmentation Classi?cation Leger Short Form Algorithm Although hundreds of variables were used in the development of the segments in a 40 minute survey, the short-form algorithm provides for the opportunity to classify a respondent within this segmentation in future market research studies (such as focus groups, online tracking, concept testing, etc.) by using only 10 variables (or typically 3-4 minutes) with the following accuracy levels: Faithful Followers 69% Communal Conservatives 55% Social Spenders 83% Safely Silvers90% Jackpot Junkies 64% Active Allies 77% For each statement below, respondents are asked to indicate how much (they) AGREE or DISAGREE with the statement (using the following scale): 1 = Strongly Disagree 2=Disagree 3 = Slightly Disagree 4 = Slightly Agree5 = Agree 6 = Strongly Agree • • • • • • • • • • Playing the Lottery is one thing I can do to help my family I look for lottery games that are entertaining I buy tickets to win money If the Lottery was not currently established in Maine and a vote to legalize Lottery operations was held today, I would vote for the Lottery The Lottery takes advantage of the poor I am a good source of information on lottery games I'm willing to spend more for a lottery ticket if the prize is higher When I buy a lottery ticket I often think I should buy one more because the next ticket may be a winner I am more likely to purchase a lottery ticket if a store clerk suggests it The Maine Lottery is being run honestly 63 Short Form Algorithm (1) – Sample View When opening the Excel file, be sure to allow the file to ‘enable the macro’ when prompted to do so. 64 Short Form Algorithm (2) – Bring in Values From Cases “ID” simply represents the unique case/respondent identification number. 65 Short Form Algorithm (3) – Click on ‘Assign Segments’ After typing or pasting-in data, simply click on the box that reads “Assign Segments” 66 Short Form Algorithm (4) – Macro Will Assign Segments The segment variable code along with the segment label now appears in the sheet. 67 Short Form Algorithm (4) – Macro Will Assign Segments Select “Copy Segments” to copy the results into a new spreadsheet, or “Delete Segments” to reset the sheet. 68