Just the ticket

Published on Saturday 21 June 2008 15:19

THE former drinks executive charged with introducing the People's Postcode Lottery to Scotland has his eyes fixed on the country's football stadiums. Mind you, not for the football. He wants to use the venues to transform the way we celebrate his prize-winners, and that means turning them into festival-style events.

In Neil Boyd's world a lottery draw isn't something that gets lost amid the late night television schedules. He wants all the razzmatazz, complete with superstar rock bands and stadiums full of potential winners.

"We're a bit far off that just yet," says the sharp-suited Boyd. "But why not? In Sweden they do it. They have the country's top bands, big outdoor exhibitions and the whole day attracts around 20,000 people.

"Why? Because most people in the town know somebody is going to collect a significant pot and the way the prize money is distributed a lot of other people within the same sector will get significant cheques. You make a town very happy."

It has been less than six months since the People's Postcode Lottery hit the streets of Scotland via STV's show The Postcode Challenge, hosted by Carol Smillie. Since then the local rival to Camelot, which attracts around 60,000 players a week, has donated 450,000 to charity and given away more than 1m in prize money.

For managing director Boyd, who was drafted in from Bacardi in February to grow the concept, the potential for the subscription game is unlimited.

"The attitude of the British public towards gaming is phenomenal," he says. "It is no longer the dirty word that it once was. If you look at the amount spent per head in the UK on gaming compared with other European countries you can see it is three or four times higher.

"We talk in the language of odds in this country. Ascot, the Derby, Cheltenham, Glorious Goodwood – they all trip off the tongue. Walk down any UK high street and you see Ladbrokes, Betfred, William Hill – that just doesn't happen elsewhere. We all know what the odds are on the European football teams; it is embedded in the culture."

That may be, but while the amount staked on gambling more than doubled between 2002 and 2006, growth has stagnated in the 2005-07 period, with the total amount staked hovering around the 65bn-66bn mark. The modernisation of betting shops has had an impact.

Licensed betting shops generated more than 31bn in 2006, up from about 10bn in 2002. But Boyd remains optimistic, arguing that Scotland is well placed to follow the private charity lottery model in Scandinavia.

"If we get to 30% of the population, which is what they have in Holland, then that is 600,000 people playing on a weekly basis. Then there are going to be some significant prizes."

As it stands, players buy a 2 ticket which is entered into a weekly prize draw. Each ticket has the player's postcode as well as a unique three digit code. The top prize of 25,000 is split between ticket-holders in the winning postcode, while a smaller pool of money is split between a larger post code sector.

"A fifth of the money goes to three Scottish charities: Scottish Wildlife Trust, Maggie's Cancer Care Centres and Children 1st. It's small at the moment, but we are only a start-up. If I say to you 'Postcode Lottery', it has a bit of a stigma attached to it in the UK. It is about healthcare funding or poor schools. We need to turn that around.

"When you mention the word 'lottery' people have a natural assumption on how you play. But in six months we have grown to a company with a turnover of 8m. The odds are actually fantastic at the moment, compared with the National Lottery. By the year end they won't be nearly as good, as we want to be selling 120,000 tickets by then."

It's a tall order, given that research from Mintel shows that, compared with other forms of gambling, the popularity of lottery games is falling. Last year Camelot saw sales of its draw-based games fall by 4%, taking total annual sales below the 5bn mark.

It's been 14 years since Saatchi & Saatchi's ad campaign proclaiming "It could be you" burst onto television screens, firing the starting gun for the launch of the UK National Lottery.

Back in 1994, hitting the jackpot on the Saturday night draw was the only route to riches, and 45 million tickets were sold each week. A few months later, scratchcards were launched and sales rose to 90 million.

But the success was short lived as the public, by now wise to the fact that they were not going to scoop the jackpot, lost interest. In a bid to raise sales Camelot introduced a series of games. Now there is a total of five: Thunderball, HotPicks, scratchcards, Daily Play and the original game, now called Lotto, which analysts say accounts for 70% of sales. And then there is EuroMillions, the pan-European lottery offering jackpots of up to 50m.

"We are not Camelot, let's be absolutely clear," says Boyd. "Camelot has been around for 12 years, it is a state-backed lottery, and cheaper than us. It does good work and is well established. We are a private lottery set up to raise money for charities. We are miniscule compared with Camelot.

"But we are very Scottish. All the money spent by the game player stays in Scotland either with the winners or Scottish charities."

Boyd, who has just opened the firm's UK headquarters in Leith, says the long term aim is to drive the concept into England.

"We have started in Scotland but I am absolutely sure we are going to take on the rest of the UK. When we go into England it will probably be a regional lottery-type application there or a TV network deal. If it works in Scotland it can work in England."

It's this type of sales speak that attracted the Dutch company Novamedia BV to Boyd. Having grown up in Scotland he learned his trade in Italy as a sales and marketing executive with a healthcare company before moving to Glenmorangie and finally Bacardi, where he was responsible for growing the Dewar's business. For his last job he commuted to London on a weekly basis. Now that regular trip is to Amsterdam.

"The three Dutch guys that set the firm up all come from a charity background. It's different to working in the drinks industry.

"Certainly the Dutch are very direct, less hierarchical and less process-driven. This means they can be very entrepreneurial and they are very action-orientated.

"They like to get things done and if you look at how quickly they have set this up I think it shows.

"The board at Novamedia have a mission to develop charity lotteries across Europe. They are now on their third country and going from strength to strength."

But it will not be all plain sailing. In Holland, Novamedia was sued by a player for "lottery stress". Helen de Gier, who lived in a winning street, but was not a winner, said the seven who did win, each getting about 9m, flaunted their victory. Although she lost her case, experts agreed the system may cause stress.

Psychologist Dr Mark Griffiths, professor of gambling studies at Nottingham Trent University, said that "it is a human characteristic to compare ourselves with those around us" and it can be "stressful" to be left isolated from others.

Boyd's answer? "Buy a ticket."