TLC Says Sales Are Down!And This Is My Opinion As To Why!Links to all other pages regarding the proposal
Revised 3-16-00 |
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IntroductionOn Tuesday, March 14 at 8:30 AM, there was a Commissioners meeting at Lottery Headquarters in Austin. Rumor had it that Linda Cloud was going to suggest changing Lotto Texas again because sales were down. (This is no longer a rumor - she absolutely suggested adding 4 balls to Lotto Texas which will make it very difficult to win. They want to ensure fewer winners so the jackpots can grow. What a disgrace.) Since my intention is to spell out clearly what I think the problem is with the Lottery's sales, I feel you need to know my qualifications in speaking my mind on this subject. I own the Lotto Report - I am the founder, publisher, accountant, saleswoman, writer, secretary, statistician, webmaster, delivery person and janitor. As you can see, I wear many hats. Because the Lotto Report sells in retail outlets, I am in these stores daily so I see what's going on out in the field. As many people can attest, my greatest gift is that of sales. Prior to publishing the Lotto Report, I published Unexaggerated Homes of Dallas for 18 years. And I was the top sales person for 18 years. A Brief History of The Texas Lottery's Games & SalesFirst, let's establish the history of the Texas Lottery and its success. The state started selling scratch off tickets on May 29, 1992. They had roughly 5000 retailers. When they started selling scratch off tickets, every clerk would ask if you wanted to buy a scratch off ticket. Huge success. More so than you realize. Then, in Nov. 1992, they kicked off Lotto Texas with approximately 10,000 retailers. Retail outlets grew by 5000 stores by the time the Lotto began. Of course, retailers were already signed up - they were just waiting to be set up with their machines. When the Lotto began, it was a huge success too. Minimum jackpots started at $2 million with drawings twice a week. Every clerk in every store would ask every customer, "Have you got your Lotto tickets?" Come on ya'll, you remember this don't you? The excitement was everywhere and boy did Texas ever have a great sales staff. On October 25, 1993, the Pick3 was introduced. It was to be played 6 nights a week and was designed to attract the players who wanted to win hundreds - those were players who didn't necessarily believe they could win millions. The theory was, we need a game to fit everybody. Like Las Vegas. Within one year and 2 months, in January 1994, the minimum jackpot for Lotto Texas was raised to $3 million. Now what's important to note here, retailers had grown to approx. 13,000. Still, clerks were always asking customers, "Have you got your lotto ticket?" The Pick3 was a success. They had their own group of players. Not all Lotto players played Pick3 and it was a tough game to educate players on. Still is. One year later, January 1995, the minimum jackpot was raised to $4 million. By then, the Texas Lottery Commission had increased their retailers to approximately 15,000. By October 13, 1995, things were going so well that the Texas Lottery wanted to please the group of players that said they wanted less than millions but more than hundreds. So came Cash 5 twice a week. It was a game that would pay from hundreds to thousands to hundreds of thousands. This game was a really big hit. In fact, it was so great that on November 25, 1996, one year and one month later, the Texas Lottery decided to play it 4 times a week. But this was the straw that began to break the camels back! For players, this was entirely too much. Players wanted to always play their numbers but couldn't afford it 4 times a week. Many got mad and just quit while others simply cut back their expenses all the way around. By Nov. 1996, the retailers had grown to somewhere between 17,000 to 18,000. The Texas Lottery had a tremendous sales force at this time. Just a few months later, beginning in 1997, sales begin to drop on all games. The Texas Lottery began to search for reasons. Retailers were coming and going. For each retailer they lost, another one signed up. They managed to stay even. With sales still slumping, on May 29, 1998, they introduced Texas Million. The Texas Lottery had heard that players wanted an opportunity to win "One Million Dollars" so they came up with a game to suffice. This game was to be played every Friday night. They promoted the game heavily and sold tickets for several weeks before the first drawing. Just so you know how obvious it was this game was BAD, let me list the total sales for the first 7 games: $6,142,592 And sales have continued to drop .... From $2.9 million to $2 million from 7-10-98 Through 9-18-98 Question ... when there is a million dollar winner, how do they pay without "co-mingling funds" so to speak? What if there were lots of winners? Is this a good business plan for any business based on these sales? With my check book paying out more than I take in is disastrous. March 2000 - Sales are still declining. The TLC did nothing that was suggested in 1999 by their Players. Instead they got special permission to try again to add 4 balls instead of fixing the obvious problems. So, its time for us to bear all to HALT this plan of theirs. Sales Down - What Does That Generally Mean To A Company?One of two things. Either the product is no longer in demand OR there is a problem with sales personnel. In the case of the Lotto Texas, with the given facts as they stand, the answer, in my opinion, is clearly a problem with sales personnel. Retailers - Managements Attitudes Changed - Why?First, let me define what I refer to when I use the term "Retailers" - mostly I refer to convenience stores and/or service stations. Like 7-Eleven, Diamond Shamrock, Stop N Go, Racetrac, Exxon, Chevron, Circle K, etc. Also, I am referring to the management side in this section of my writing. Retailers are extremely competitive. An example - If a station on one corner offers gas at $1.34, then the station across the street will offer gas at $1.34 too or less. But the same owner may sell gas for $1.60 three intersections away. If one sells slurpee's, the other one will have slushes. Get the picture. But one common factor found with most of them is their golden rule - "Do not keep our customers waiting. PERIOD!" When Texas came out with a Lottery, many retailers simply refused to carry it. They had had sour experiences in other states and had hoped they could get away without offering it here. But customer demands WILL and DID change many corporate minds. If a corporate chain feels they lose business because they don't sell something, then they will ultimately carry it. But they won't necessarily tell the world about it! On the other hand, many retailers were excited to carry the Lottery. They instructed their employees to promote it heavy. They bought signs, had banners, and placed the Lotto stands where it was the first thing you saw when you entered the store. So why are so many retailers pulling Lotto signs and not pushing Lottery sales like they did in the beginning? The reasons are plentiful but they are fixable. I'll name a few reasons for you - maybe it will help you understand what's happened. 2. Retailers never bargained on it being so difficult for players to get drawing results. They thought the drawings would be aired on TV. As a result of television stations ceasing the airing of the drawings, this put an extra burden on the retailers. (I might mention here that the Texas Lottery lost most of its free drawing TV coverage when they began the Texas Million game. You see, they changed the order of the drawings which made it more difficult for the stations to edit the tape. The stations only had one minute to edit and get the information they wanted to air.) 3. Inconsiderate players throw their tickets on the grounds which store personnel have to pick up. Most retailers have sufficient trash cans for customers to use. But - some people can't/won't find them. 4. Retailers make considerably more money selling gas, oil, candy, cokes, cigarettes, chips, donuts, milk, bread, eggs than they do selling lotto tickets. And these sales are much quicker than with an undecided lottery player trying to figure out which ticket they want to buy. Then let's not forget about those players that ask 10,000 questions and hold up the lines. 5. When the jackpots are large, Retailers need more help to take care of customers. Yet the income does not justify their added expense. However, I've been told that 10 cents on the dollar would be enough to satisfy them. Remember, minimum wages have gone up and income from Lotto sales have gone down. 6. Many players will purchase scratch off tickets and stand right there at the counter and scratch it off leaving that stuff all over the counter. They don't think to move out of the way for other customers nor do they consider the mess they are leaving that someone else has to clean up. As you can see, a combination of these things over a period of time could rub anybody the wrong way! And I realize that I'm coming down on the players. But this is what the store manager, upper management and clerks deal with daily. How would your attitude be about selling Lotto if this is what you went through everyday? There are other factors but for the purpose of QUICKLY turning sales around to keep our games in tact, this will do. The Clerks - The Forgotten Ones Yet The Most ImportantHow long do you think 7-Eleven or Diamond Shamrock or any chain could stay in business if they had no clerks to wait on the customers? Not very long. Do you think the managers or supervisors would step right in and fill their shoes? Not for a long term. Who leaves the lasting impression on the customers? The sales clerks do. Did you notice that I called them "sales" clerks? So, OK, lets have a look at these people. As a general rule, clerks are students putting themselves through school, are retired people looking for extra income, are people hoping to move up the corporate latter and are just getting started ... No matter what the case, they all have one thing in common. They are working at an hourly wage and could all use extra money. They work hard. They stand on their feet for 8 hours a day taking care of people's needs. And they have the most important job of all - They REPRESENT the convenience store. They are the only folks who come face to face with the customers on a regular basis. These are THE people who have the golden opportunity to say, "Have you bought your lotto tickets." When the Lotto began, these ARE the people who really sold Lotto tickets. Clerks were excited because they thought about the dream of winning or knowing a winner. They thought that somehow they would get something out of it if they sold a winning ticket. It took years, but they finally realized that, in reality, they wouldn't get anything after all. It's been proven over and over to them. So their attitude today is - "It means a lot of extra work for me if I sell a lotto ticket so why bother. I'll get absolutely nothing out of it. I just don't care if they sell." I hear this daily. Every sales person knows that you have to ask for the sale. A salesman that doesn't ask for the sale will probably starve to death. And this is precisely what is happening to the Texas Lottery. Can the Texas Lottery Increase Their SalesYES. Absolutely. There is nothing wrong with the game. This is what I think they should consider. 1. Give an incentive - pay the person who sells the winning ticket a bonus of $25,000. Hold a Press Conference in his home town so that the newspapers will pick up and run the "human interest" story. The end results will be that every clerk in the state will be selling Lotto tickets like crazy in hopes of selling a winning ticket too. Lotto sales WILL climb. In ConclusionSo, here we are today - March 2000. Sales are still declining daily so the TLC wants to add 4 balls instead of fixing the obvious sales problem. They know that jackpots will grow as a result of higher odds and they are banking on players being suckered in because of large jackpots. What bait. Just click here to see how |
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