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The Local Lottery Investor Pack

cfagan
October 01, 2013

The Local Lottery Investor Pack

A snapshot of the business case, benefits and challenges/risks

cfagan

October 01, 2013
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  1. CONTENTS CONTENTS 3. MISSION STATEMENT 4. HOW IT WORKS 5.

    THE MARKET 6. THE GOOD 7. THE CHALLENGES 8. THE PLAYER(s) 9. THE MARKETING 10. THE ONE-MAN TEAM 11. WORK/ASSETS SO FAR 12. INVESTMENT & TIMELINE
  2. The Local Lottery is a new Australian online micro-lottery that

    provides punters with a greater chance of winning the major cash prize
  3. HOW IT WORKS 8 12 35 Each 3-number combination has

    a 1 in 59,280 chance of winning the weekly drawn lottery. EXPECTED CASH PRIZE: $5k-$50k Customer chooses (or generates) three different numbers between 1 and 40 using the website... The Local Lottery pays out 80% of the total pool evenly to the customers who have bought tickets with the 3 winning numbers. FOR EXAMPLE: - 10,000 customers buy an average of 24 lines/games per lottery. - Total pool size: $120,000 - 5 people win with the winning numbers - 80% of the pool ($96,000) is split between the 5 customers at $19,200 per customer.
  4. THE GOOD Huge market currently operated in Australia by one

    company. Profit from online ticket sales for Tattersalls reached $18.6m in 2013. Tattersalls are a slow moving beast when it comes to online - it is unlikely they will either take their online presence seriously or have the skill to execute their campaigns and product online to attract new customers in the younger demographic (18-30). Lower prize amounts mean a much greater chance to promote winners and how they spend the money - to attract further customers in the 18-30 age bracket. An all-online approach greatly minimises barrier of entry to market and sets up opportunities to control the burgeoning online space.
  5. THE CHALLENGES Legal Australia’s laws make it hard to setup

    and advertise a gambling-related business. The legal answer is to operate off-shore and Norfolk Island is a prime location for such a business. Marketing - Overcoming perception Lotteries are a common source of fraudelent online schemes. People are wary of lotteries and will need to be carefully managed through the online process through design, positive reinforcement, company transparency and a careful attention to online security detail. Marketing - Appealing to a new demographic 8% of Tattersalls lottery ticket sales are online. That number has grown in recent years but the majority of customers are still offline. This has a strong relationship with demographic and as new customers enter the 18-30 age bracket, more and more will look online to buy tickets.
  6. THE PLAYERS...or PLAYER Tattersalls Combined lotteries revenue 12/13 $2.01b Percentage

    lottery sales from online channels 8.2% Net profit from lotteries $227m Net profit from online lottery ticket sales $18.6m The year (12’-13’) saw us recruit and install a new CEO who not only brings new experience from the online industry, but who also represents generational change to better address the tech-savvy customers of the future. HARRY BOON Tattersalls CEO, Sep 2013 “”
  7. THE MARKETING Goodle AdWords Targeting common keywords and specifically Tattersalls-related

    keywords such as: - “buy powerball tickets” - “powerball results” - “ozlotto results” Facebook Facebook advertising allows TLL great demographic filtering options to target to our preferred audience. In general, most people will be targeted. Facebook will provide a comprehensive demographic cross-section quickly and we will be able to quickly tailor our website landing pages to increase conversion based on this knowledge. Partnership with Jumbo Interactive www.jumbointeractive.com Jumbo Interactive are an Australian-based publicly listed company that on-sells lottery tickets for lotteries around the world but began in Australia (with the majority of its business being Australian-related) It is the goal of TLL to partner with Jumbo Interactive to help promote alternatives to Tattersalls lotteries.
  8. THE ONE-MAN TEAM Christian Fagan MELBOURNE, AUSTRALIA Art director, marketer,

    copywriter, animator and front-end developer. With 10 years experience, I am an expert web designer and front-end developer. Currently a Senior UX Designer at a renowned Australian design agency, I have had experience working with some of Australia’s biggest brands, including: Holden (part of General Motors), Australian Defence Force, Fosters, Heinz, Medibank Private, Fairfax Digital, Red Cross Blood Service and 99designs. A passionate web enthusiast, I am looking forward to creating a world-class platform and being disruptive.
  9. WORK/ASSETS TO DATE “The Local Lottery Pty Ltd” registered in

    Tasmania with head office in Hobart. Domains registered: - thelocallottery.com - thelocallottery.com.au - thelocallottery.net - thelocallottery.net.au Bank account with Bankwest Branding (logo and colour scheme) Preliminary legal advice (to the value of $2k) Design for desktop website Front-end desktop website build
  10. INVESTMENT TIMELINE $175k for 15%. Simple as that. 0-2 months

    Website build 2-4 months Application and submission to Norfolk Island gaming commission for testing 4-10 months Lottery website is operational. Online advertising is on-going. Initial costs (first 6 months): $30k Development of website and gaming logic $20k Initial legal advice $15k Norfolk Island Gaming License Application $6k-$30k Norfolk Island Gaming License testing $20k $151k-$175k TOTAL Guaranteed $10k cash prize for first two lotteries $70k Google and Facebook advertising